Streamlining eCommerce order fulfillment can be a complicated process, but getting it right helps companies improve margins and customer satisfaction while reducing costs. It can be a valuable part of your growth strategy by making it easier to offer reliable, fast shipping to improve customer conversion and reorder rates.
If you’re looking to capitalize on the eCommerce growth projected for 2021 and want to keep the competition at bay, spend time getting your warehouse and fulfillment operations right. We’ve put together 12 specific best practices to assist your efforts, focused on your customers, business processes, products, and business strategies.
3 customer-focused tactics to improve operations
1. Automate delivery of tracking numbers and shipping updates
Streamlining eCommerce fulfillment efforts are all about reducing friction and work. One central pain point for an eCommerce company — and friction for your customers — is having service reps manage emails or chats asking for a tracking number or order status. Your best move is to link your order management and fulfillment services together so that customers get an automated email as soon as a tracking number is available.
If you have a longer process, such as how FreshHoods sews garments only after a customer orders, send multiple emails with clear updates such as the image above. It keeps customers excited while minimizing their need to reach out to customer service for updates.
2. Integrate CRM with your order management
Behind-the-scenes, you’ll want to link your order management and fulfillment tools with your customer relationship management (CRM) solutions if they’re separate. The integration will speed up any customer service request and proactively notify customers about issues as you track carrier fulfillment.
A linked CRM gives customer service agents faster access to customer and order data when a problem occurs. They won’t need to put someone on hold or make them hunt for an order number in their email. Your team can also provide more direct relief, such as adding discounts or coupons to the user’s account, to avoid losing that customer.
One final benefit of this integration is that your agents can update the customer information to avoid future issues. So, if someone leaves their apartment number off an order, customer service agents can fix it for that immediate order and update the customer profile to prevent it from happening again.
3. Match customer and warehouse locations
You can speed up and streamline eCommerce fulfillment while you make it more affordable by sending products from the warehouse closest to the customer. If you or your fulfillment partner operate multiple facilities, use location data to determine which fulfills a given order. Not only are you able to reduce expenses by shipping across fewer zones, but sometimes you can reduce costs further by avoiding expedited options and still meeting your promised delivery date.
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4. Introduce multiple scans and checks
It may feel a little counterintuitive to add steps to your fulfillment process when trying to streamline it. Still, adding scans and order checks minimizes mis-picks and errors that cause significant supply chain headaches. Getting the order right the first time as it heads out your door can reduce fulfillment costs and labor while improving the customer experience and team morale.
Your best option usually is to provide mobile barcode scanners so pickers can scan each item as they go. It’ll double-check their work and verify that an order is complete before they bring it to packers. Give the packing station its own scanning requirements to verify goods before they start packing to ensure accuracy. This is part of the Red Stag Fulfillment process that helps us achieve an accuracy rate of 99.98% — and we also make customers whole when impacted by that 0.02% error rate.
5. Automate carrier criteria and selection
Carriers are a core part of streamlining eCommerce fulfillment. That means one of the best manual tasks to eliminate is carrier and shipping service selection for each order. If your eCommerce or fulfillment software supports it, create rules to govern how to handle your orders. By setting time and cost requirements, you’ll always select the most affordable option that still meets the speed the customer expects (and paid for) for their goods.
One important note is to ensure that you’re comparing costs based on product weight and dimensional (DIM) weight. Take DIM weight measurements and calculate those rates to get the most affordable rate and avoid any carrier charges and fees for paying improper postage.
6. Standardize reorders and inbound shipping
Your eCommerce fulfillment can grind to a halt when you can’t fill an order completely. Replenishment should be a focus for your warehouse leadership so you can avoid overstocking as well as going out of stock. Set minimum thresholds so that you know when to restock. Thankfully, many eCommerce and inventory management tools can either send your team alerts or automate reorders so that you don’t run dry.
Review your replenishment guidelines regularly to match fill levels with demand. That’ll help you keep the right amount on hand and not need to pay for expensive, expedited freight. Make this part of your overall warehouse planning so that leaders allocate the right amount of space for your goods and maintain adequate safety stock.
Monitoring replenishment can also help you track the capabilities and reliability of your vendors. You not only need to make replenishment orders at the right time, but your partners need to deliver. Customers suffer when either side of that equation is disrupted.
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7. Match products with promises
Fulfillment can become a burden when you’re constantly stressing to meet promises you make to customers, such as a blanket promise of free or two-day shipping on every order. Not every product can support those claims. Heavy items, for example, might cut into your margins too much if you don’t charge the customer for shipping.
So, streamline fulfillment by ensuring your offers make sense for each product and creating rules specific to those goods. Rules should include when you offer free shipping or what can meet a two-day demand. Apply those to eCommerce shopping carts to avoid customer confusion or someone trying to purchase expedited shipping when that’s not available for items in their cart. Standardizing rules on your website also leads to regular practices in your warehouse, streamlining the work pickers and packers do, as well as helping your team spot issues.
The best eCommerce option is to manage expectations and try to outperform. Promise what you can reasonably deliver to avoid customers asking for refunds on shipping or their entire order.
8. Keep a space between similar goods
Many eCommerce goods can look alike, which makes them harder to pick accurately. This could be something as simple as selling multiple sizes of shirts, two kinds of red sweaters, or goods that come in packages of three 12-oz bottles and four 8-oz bottles. When a picker is in a hurry or is new to your company, they can easily mistake one for the other when filling an order.
We’ve already discussed introducing scanners in your picking workflow, but a simple tactic to streamline eCommerce fulfillment and avoid mis-picks is to add physical space between bins and picking locations. Your shirts may all be on the same aisle, but the small sizes for every design are located at one end while larges are at the other.
Pair this with more extensive and better labeling of aisle and bin locations, and you’re empowering your team to succeed.
9. Organize your warehouse to improve flow
You can apply an organizational structure to your warehouse and SKU locations for specific purposes. Some standard techniques, such as moving high-volume sales SKUs closer to packing stations, can help you make immediate gains. However, you can take this further if you have a robust inventory or warehouse management system.
Use your tools to review warehouse layout and minimize the walking distance pickers take for each order. Suggestions will be based on your goods and average orders but may include placing goods with low turnover at the back of your warehouse or establishing one-way aisles. Place goods that require forklifts aisles where people only pick from one side to minimize the chance that products will be damaged. Even in custom settings, such as cold storage, your tools may provide layout suggestions that make FIFO easier and avoid spoilage.
3 things to consider for streamlining tomorrow’s eCommerce fulfillment
10. Identify service gaps
Getting your warehouse and fulfillment operations ready for your next phase of growth can be tricky. But, streamlining eCommerce order fulfillment does pay off regularly. So, start your planning by reviewing current capabilities and asking how you can improve. Think about your people, equipment, processes, and customer demands. That reflection should bring up questions like these:
- What manual processes remain in my warehouse, and which can be automated?
- What information aren’t my partners giving me that I need?
- Where are the current bottlenecks for outbound and inbound fulfillment?
- If my orders doubled, could I handle it? What if orders cut in half?
- What’s missing that would allow me to solve the most impactful customer complaints?
11. Create room to grow
All of the work you do to streamline fulfillment can disappear in a flash if you outgrow your space. Unfortunately, this can happen either because you need to store larger quantities of products or because you need to create more office and administrative space to keep up with sales, service, and other demands.
Every eCommerce company needs room to grow. If your current facilities lack space, it’s time to start planning on a new location or partner. You may need to expand your facility by building another warehouse or break ground in an entirely new location.
Many eCommerce companies face warehousing and space issues as they jump from startup to an established household name. It’s not always economical to lease new space or expand your location. Those are significant capital expenditures, and your business might not be ready. If that’s the case, consider outsourcing eCommerce fulfillment to help you control costs while still meeting increased customer demand. You can ease into this by mixing fulfillment between a partner and your existing warehouse — that’s a perfect opportunity to matching customer order and fulfillment locations mentioned in #3.
12. Keep team goals achievable
As most eCommerce companies work to streamline fulfillment, they create new goals and KPI targets. While leadership may want to generate a cost savings of 10% or increase efficiency by 15%, these goals must be achievable by your team or 3PL partner. Remember that warehouse jobs are physically demanding, so significant speed increases may not be a reasonable request. You don’t want to have a warehouse that makes the news for poor labor conditions or worker mistreatment.
So, create goals that are realistic and give yourself room to grow into them. You might need to hire additional pickers or install another packing station to meet your speed goals. Accuracy improvements often require new equipment as well as process updates. If you can’t afford the people or systems needed to meet your new targets, turn them into long-term goals or seek out partners who can help you take your fulfillment to the next level.
Struggling? Consider new partners
When you started looking for ways to streamline your eCommerce order fulfillment, you likely had expectations for what you could achieve. That might have been specific savings, help scaling, or ways to put products into customer’s hands faster. There are many paths to reach those goals, but it can be confusing and time-consuming to determine which is right for you. A new partner might be necessary for your success.
If you’re unsure of what steps to take next or don’t know if your team can achieve streamlining goals, reach out to Red Stag Fulfillment. We’ve worked with many eCommerce companies to improve their fulfillment and generate more recurring revenue from satisfied customers. We’ve also helped people find the right software or partner that met their specific needs. Let’s have a conversation about what and who might be your best past to improving fulfillment savings, speed, and reliability.