Most companies have heard about the high-level benefits of having accurate weights and measures (cubic dimensions) for each SKU in their warehouse management systems, but many operations still aren’t utilizing them. Without this information, companies will struggle to provide the basic data to do slotting, better capacity planning, and if necessary full truck or LTL planning. As a result, they may be paying more in accessorial charges and other freight charges – this includes the small parcel side as well.

By dimensioning SKU inventory, we mean the accurate cubic and weight measurements via technology rather than manual measurements or estimates. Dimensioning is an important building block to managing your operations.

Related: 

In order to dimension SKU inventory, companies acquire a cubing and weighing system (also called dimensioning systems). These systems are available in a variety of models such as a mobile units on a cart, or a large bed scanner in line with conveyors.

The basic systems scan the product to determine dimensions; weighs the item; records and sends to your warehousing or enterprise shipping system. Updating the product master file can either be batch or online, real time.

When you consider the total cost of an order – management, direct and indirect labor, benefits, facilities, packing costs excluding shipping costs – more than 50% of the cost per order is labor related. Given this, do you measure productivity by department and individual? Looking at the e-commerce fulfillment operations we’ve done operational assessments for, more than half do not have accurate and consistent standards for productivity and measurements.

Warehouse Management Systems (WMS) have become more affordable even for small to moderate sized e-commerce businesses because of subscription, cloud or Software as a Service models. That’s exciting because of their potential!

Read "Is a WMS Right For Your Business?"

However, you still need to use a methodology to select the right system for your business with your budget. Short cut the process and you may select the wrong warehouse management system or it may cost you more than you think. Here are 13 things to consider to successfully select the best WMS system.

The omnichannel industry has spent massive efforts to manage and fill customer orders from multiple shipping points - order on Internet and pick up at store; or ship from store or distribution center; etc. Whether you have multiple shipping points or not, many companies can benefit from making inventory management a strategic objective with the intended outcome to optimize inventory levels to maximize sales, profits and customer service.

If you’re not in stock when the customer orders, or can’t get it to them on their time table, you’ve lost the sale. And here’s the real rub, maybe you lose the customer forever along with their lifetime value.

This blog identifies six considerations that are essential to strategically managing inventory to produce higher sales, profits and customer service.

There are many advantages to using third party logistics (3PL) for order fulfillment, system support and customer service for omnichannel businesses. Companies can achieve competitive costs; avoid capital expenses for facilities, automation and systems; and concentrate on marketing and merchandising rather than managing fulfillment. (Read 10 Ways A 3PL Can Help Multichannel Companies Operate Profitably for more information.)

Using 3PL services is not for every company. The relationship you’re seeking is not just a service but more importantly, a partnership. In our consulting, we have clients that are long term users of 3PL as well as firms that are 3PL providers.

This blog discusses 11 key indicators of service. Use these 11 items when you negotiate your 3PL contracts -- include them as Service Level Agreements (SLAs) that show contract performance goals that are reported and discussed on a regular basis. And of course, when problems are severe, the first course of action is to resolve the issues before deciding to leave the 3PL.

Some companies spend huge amounts of money on new websites every couple years. However, the backend operations are running the same way as they were years ago, with conventional, manual processes and systems.

With e-commerce’s small orders, companies need to be extremely efficient so that profits are not eroded by operational costs that don’t improve on a cost per order basis as order volumes increase.

As we consult with omnichannel companies, sometimes we see companies wanting to know what benefits there will be from automation, but they don’t have solid warehouse processes and systems as a foundation. Warehouse Management Systems (WMS) and automation are not an “either/or” decision. There are dozens of benefits to WMS and automation when considered separately. To get the highest benefits you need to consider the synergy of the two together. This blog illustrates the primary synergy and discusses a plan for evaluating for your business.

In a recent client project, we were tasked with finding a warehouse facility to replace a 40 year old, 100,000 sq. ft. building. The client is based in Virginia and did not want to leave the Commonwealth. In the entire state, there were no available existing facilities of their current size, and there were no facilities large enough to provide the expansion capabilities they required. They had no choice but to pursue a Build to Suit plan which will take more than two years -- the typical time frame.

In our benchmarking studies with omnichannel and e-commerce businesses, we find the cost of shipping is by far the #1 fulfillment expense. In most companies, shipping expense exceeds the sum of all other fulfillment costs including direct and indirect payroll, benefits, facilities, utilities and packing supplies.

Parcel shipping growth will continue to rise at a rate of 17%-28% each year between 2017 and 2021, and by 2020, same-day delivery will drive up logistics costs as a percentage of revenue by 50%, according to recent analysis by Gartner.

By now, you have the peak season planning for Fall/Holiday 2018 well underway.  If you are behind schedule, there is still time to implement improvements, but you need to be prudent to not overcommit.  Here is a list of 14 critical considerations for improving peak season readiness:

Offering merchandise from drop ship vendors has greatly extended the assortment of many e-commerce and omnichannel brands. Many e-commerce businesses do not have internal fulfillment and drop ship 100% of their assortment. The challenge for the retailer is to maintain high customer service standards and vendor compliance with the drop ship partner.

Two Mystery Shopping Experiences

Recently, we mystery-shopped two of America’s largest merchants, each of which have tens of thousands of SKUs. This experience illustrates key customer service criteria you should assess in your business.