In today’s digital age, customers are now more likely to order something online, rather than run to a store to make a purchase. Companies are finding that in order to compete, they must invest in omnichannel ecommerce. As a result, Third party logistic operations (3PL’s) need to upgrade their offerings and become Omni-channel operations with automated order fulfillment services that support not only full pallet and mixed case pallets orders, but also seamlessly handle e-commerce pick, pack, and ship operations.
The Growth in ecommerce fulfillment has created a paradigm shift. For 3PLs to remain successful they need to be able to process single SKU carton shipments direct to consumers. E-commerce is a much more complex beast, and typically generates a lower cost per fulfillment charge, while still requiring same day delivery.
As e-commerce continues to rapidly grow, a 3PL requires a highly efficient blend of automation technologies to control picking, packing, and shipping costs. Right now, unemployment is so low that hiring and retaining reliable labor to run distribution operations is much more challenging and costly than investing in automation.
In addition to labor challenges, a major requirement brought on by the growth in omnichannel ecommerce is Dimensional Weight capture. Dimensional Weight capture is now a required component of manifesting in order to obtain the lowest cost parcel shipment rates. All the major parcel shippers: FedEx, UPS and USPS rely on dimensional weight, and utilize a formula to calculate billable charges based on a package’s Length X Width X Height divided by the carrier DIM factor. For FedEx and UPS, that DIM factor is approximately 166 and can be negotiated based on a 3PL’s shipment volume. When it comes to parcel shipping, size matters, because an extra inch impacts shipping costs, especially when the order is an air shipment.
Key E-commerce automation technologies that streamlines and lower a 3PL’s operational costs:
- Cartonization coupled with highly efficient picking technology that eliminates the reliance on an operator guessing the correct carton size during the picking or packing operation. When carton size selection must rely on guesswork, companies waste money shipping boxes that are unnecessarily large, or waste labor repacking an order.
- In-line Dimensional Weight Capture technology combines an in-motion scale with a 3-D Camera dimensioner to accurately measure each parcel so actual dimensional weight is used for carrier selection and manifesting.
- Print and Apply Labeling automates the application of the parcel shipping labels, packing slips, UCC Compliance labels, ASN labels, and other order documentation requirements. Print and apply operates at 500% – 1000% the rate of a manual manifesting workstation.
Omnichannel Ecommerce Automation Technologies Lower Operational Costs
Cartonization software calculates each order’s optimal carton size using the item master to obtain SKU dimensions and weight data. Best practice cartonization software selects the smallest available carton size that an order will fit into. Cartonization adds several benefits besides lowering the impact of DIM. It also enables pick and pack directly to the right size carton or padded bag during the picking process.
Selecting the right order carton size in an E-commerce operation at the start of order release provides the opportunity to use a lean, single touch pick and pack process directly to the shipping carton. It eliminates the operator selecting an over-sized carton, reduces void usage, and the cost of shipping air.
Pick by Voice is a technology well suited to the demands of omnichannel ecommerce order fulfillment, especially latest generation multi-modal voice picking systems. Pick by voice blends the operator’s voice directed instructions with hands-free barcode scanning to perform pick and pack with item level validation. Voice picking is rapidly advancing, and the latest speaker independent voice engines entirely eliminate the need to train/record each operator’s voice.
It is the technology of choice for 3PLs because it reduces employee training time so that even a temporary employee is productive in minutes. The latest generation voice picking systems also support off the shelf hardware, including a wide variety of wireless wearable computers as well as Blue Patriot’s low-cost 450 headset/speaker microphone which can be paired with hands free Honeywell or Zebra 2-D wireless barcode scanners, providing even more hardware options.
Voice picking verifies item pick location, and SKU and lot capture in a single step. Voice directed Picking drives the much faster performance picking process with significantly higher accuracy rates compared to paper, RF terminals, and tablets. It is a high value investment a 3PL can deploy quickly to lower labor costs by 30% or more in E-commerce pick and pack, while achieving order fill accuracy rates of 99.99%. Tier 1 voice suppliers include pre-developed software modules for order release optimization, cartonization, cart build, efficient batch cart picking of 12 or more orders, as well as pick and pass conveyor zone picking processes. All split case picking applications should be combined with Cartonization logic to support single touch pick to carton applications.
Pack Automation streamlines and eliminates low value work tasks that drain profitability in a 3PL operation. Single SKU orders that can ship in a padded bag or small carton should be batch picked to a tote at a workstation designed to process “Speed Picks” along a powered conveyor line. With the proper pack design, operators can pack 3-4 orders a minute and place the conveyable carton on to the powered conveyor.
Orders picked directly to the shipping carton are placed directly on the conveyor from the batch pick cart, transport to the in-line void and semi-automatic taper. One or more operators positioned at the void and taper with an optional auto pack sheet print-fold-inserter can process 10-15 cartons per minute, at least a 500%-600% increase in packing productivity compared to manual pack and manifest stations.
Auto Scan-Weigh-Dim Consider the advantages 3PL logistics have when promoting their services with a potential new e-commerce client. They can demonstrate that every parcel shipment is automatically inspected using an in-line scan-weigh dimensioning system! Adding measurement technologies to “close the pick, pack, and ship loop” like dimensional weight capture provides the tool needed to validate the actual order content weight, and ensure the lowest parcel shipment costs. Vision audit systems for image records of carton contents can be added for further verification.
Print and apply Pair the in-line dimensional weight measurement system with an auto print and apply labeling system to dramatically increase throughput rate and shipping accuracy across the entire parcel manifesting and shipping operation. Print and Apply Label applicators are low cost robots that automate the mundane low value manual work of hand applying shipping labels, packing slip/carton content labels, UCC compliance labels, ASN labels and other order shipment labeling requirements. The labeling system integrates to the WMS and/or to a shipping manifest system for multi-carrier rate shopping software, which ensures that the lowest cost carrier is selected. For the highest return on investment 3PLs capture dimensional weight inline, auto apply the shipping label, and scan verify the carrier tracking number immediately after the print and apply labeling system.
3PL Logistics operations need to add the right blend of automation technologies to compete in the E-commerce marketplace. The investment will provide a rapid ROI and allow the firm to gain a competitive advantage for retaining existing customers, as well as attracting new high value customers. The right order fulfillment automation platform contains all the components outlined and provides a lean, voice directed pick, pack, and ship operation that reduces touches, lowers labor costs, and will increase a 3PL’s profitability.
For more information on E-commerce distribution automation and Numina Group’s Real-time- Distribution Software, RDS Tier 1 Voice Directed Order Fulfillment and Warehouse Execution and Control System, WES-WCS, contact an engineer. If you would like to speak with an application engineer or discuss how our technologies can boost productivity at your operations call 630-343-2600.
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