Many ecommerce and retail businesses achieve 60% to 70% of their profits in the last quarter of the year. Peak weeks order processing may be 10 to 15 times higher than an average week. For multichannel businesses and wholesalers, their peaks start months earlier to supply other businesses. Take the time after each peak to analyze your fulfillment’s successes and failures and develop a plan to make improvements using a multi-faceted approach.
What were the strengths and weaknesses of your fulfillment in the holiday season? Start with asking your key managers. Front line managers can often identify the symptoms. For instance, a manager may identify absenteeism as a problem, which meant a significant percentage of orders were carried over to the following day. A deeper dive into this insight will help you determine the whys.
Use data to validate everyone’s impressions and figure out how you can improve processes, layout and material handling throughout the fulfillment center. We recommend taking these six steps when analyzing your company’s peak season performance during your warehouse assessment:
In order to fully understand your customer service and total fulfillment costs, you need to assess your supply chain and its efficiency. Here are 8 supply chain strategies that will help you, regardless of fulfillment center size or the markets you serve.
We are not saying every company can and should employ these strategies. Which will give you the greatest benefits for the effort and investment?
What internal metrics give you the most accurate picture of your fulfillment performance? Consider these:
Shipping is the number-one cost of order fulfillment. Were your shipping costs in line with the budget? Did carriers meet your objectives for dropping a trailer daily and meeting cutoffs? Analyze cost of shipping versus shipping and handling income to focus on this major expense.
How can processes be improved? Seasonal employees that don’t know your operations or are unfamiliar with fulfillment center work in general are probably best suited for simpler tasks. How can processes be simplified or broken into multiple steps to make functions easier?
Where are your labor dollars spent? What can you do to make processes more efficient in these departments? At the heart of making operational changes should be creating flow diagrams of all processes.
Armed with details and options, develop a plan for improvement. What low hanging fruit is there which should be evaluated and implemented immediately? Chances are you can’t do everything. Set priorities in terms of where you can realize the greatest payback. Some of these findings can be held for re-evaluation and use later.
As you look at your company’s business plans and how well your ecommerce fulfillment performed, develop strategies for improving performance.
Other recommendations may require capital investment and budgeting. Going through a rigorous process of review and analysis after the big rush is over will pay dividends as you get into the new year and look ahead to planning for the next holiday rush.
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peak season performance?