Studies of major direct to consumer companies show a high percent of customers (80% in one study) say ease of returning product is important to their purchasing decision. Studies also show a high percentage of customers are more likely to shop with an online merchant if the merchant offers “free returns”.
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Many of the warehouse assessments that F. Curtis Barry & Company performs are initiated because a client perceives that its warehouse is out of space for receiving and storing product or creating more pick locations, thus limiting the growth of the business. Our approach to interacting with the client is to provide an experienced, fresh set of eyes to view the current layout and to envision potential revisions with the intent of gaining two to five more years in the existing facility.
Here are the top 15 elements we review when assessing a current warehouse layout.
1. Thoroughly understand the flow and utilization of the current layout, including rack configuration, slotting/pick philosophy, receiving, putaway, replenishment, inventory management, and packing and shipping. Include peak seasonal trends and a thorough volume analysis of inbound and outbound product flow.
Look at all the advertising and promotional materials produced by multichannel companies during the recent holiday season, and there’s one phrase they have in common: FREE SHIPPING. It’s the one thing on which everybody seems to agree—yet it’s also something about which virtually everybody disagrees.
A catalog executive suffers from no shortage of metrics to watch for: from average order value to email inquiry turnaround times to indirect labor costs to number of calls answered in 20 seconds or less. The real questions, though, are how to use the numbers, and if the metrics even are appropriate to track for your operations. Comparing operations solely on numbers can be misleading. Is it better to establish a set of best practices and then hold your staff accountable to them?
Having managed a call center, I have always been a proponent of in-house call centers, but times are tough and they are changing. Every company today is looking for ways to save money without hurting sales and customer service. As the pressure on businesses to dramatically reduce costs intensifies, you need to look at domestic or off-shore outsourcing of some or all call center and data entry functions as a way to improve your bottom line. Companies are also outsourcing these functions more because they can avoid using capital for new order management and telephone systems.
Read More >In many areas of the country, the labor costs for CSRs are increasing quickly, and these rates are not going to decrease. Additionally, the quality of the labor pool to draw from is not ideal due to low unemployment rates in many markets. And the direct-to-customer industry is in competition for CSRs with other sectors such as financial services.
The direct industry has a difficult balancing act to perform. On the one hand, we want to provide a high level of customer service—and that's getting tougher each year. On the other hand, the cost of direct labor per hour has increased from less than $7 to more than $11 per hour during the last five years. In some markets rates are well over that, as high as $14 an hour. Benefit costs have also increased, and now average 15% to 20% of pay.
Inventory is the largest balance sheet asset in your business. It’s obvious: If your margin is 50 percent, that means your cost of goods is 50 percent; in other words, 50 percent of your net sales are spent on inventory and inbound freight. But if it’s obvious that inventory is so important, why aren’t we more aggressive in dealing with it? Why don’t we do more to liquidate aging inventory? Why don’t we look at how to achieve the optimal balance point between high order fill rate and increased inventory? Owners and senior management need to take a fresh look at their financial approach to measuring and managing inventory. Let me give you a few examples:
Inventory is most likely the largest balance sheet asset in your company. How well you plan, purchase, and manage your inventory largely determines your level of customer service and profits.
A formal compliance program can help reduce costs
Nonprofit organizations that rely on catalogs and other retail vehicles to boost donations and further their missions can take some lessons from the for-profit world.
