Successful order fulfillment involves much more than shelves of neatly stacked products. There is an art and a science to pick and pack methods. Good inventory management and the right pick and pack software will help you ship orders with maximum speed and accuracy.
Fulfillment experts like us at Red Stag Fulfillment specialize in pick and pack services, but if you are looking to do it yourself, here is your ultimate pick and pack guide.
We first published this article on April 30, 2019. We have updated it to reflect current trends in pick and pack, plus the acquisitions of both Skubana and Stitch Labs.
What is pick and pack?
The standard pick and pack process is the same and has four primary steps. That’s true if you use a 3PL like us for pick and pack services or run fulfillment yourself. The steps are:
- Order receiving. Your eCommerce sales channels should integrate with your warehouse systems. When one of your customers places an order, the software at your fulfillment warehouse generates a packing slip. Slips can be physical printouts or digital order information.
- Order picking. A warehouse worker takes the packing slip and picks the items for the order from the warehouse shelves. This action is the core of the pick and pack service. Your inventory storage strategy and your pick and pack methods are key here. They will determine the efficiency of this step of the process. Different methods will work best for different businesses, depending on sales volume.
- Order packing. The order goes to a packing station, where your team packs it securely, seals it, and labels it for shipping.
- Order shipping. Your team should then sort orders by carrier on the loading dock. They are ready for pickup by your carrier or carriers at the end of the day.
Shipping your orders may seem simple. However, there is a complex science behind the efficient pick and pack methods. Knowledge of these methods and strategies can help you run your business better. This is true whether you are a mom-and-pop eCommerce shop or a million-dollar online store.
Picking and packing methods
When you begin to pick, pack, and ship your products, you start with methods you use in your life. You might organize your inventory the way you organize your closet. That is, put all the pants together and all the shirts together, organized by color. You might also pack your orders the way you would assemble a package to send to a friend. That is, gather the items for each order and pack them one at a time.
At first, this may work for your eCommerce business. As your business grows, however, you will need to adopt different strategies. Even if you work out of your garage, better pick and pack methods can reduce mistakes and returns. You’ll save money, and your customers will be happier.
The pick and pack methods that work well for your business will depend on your business size and products. You might change the way you pick, pack, and ship as your business grows. Here are some standard pick and pack methods that many eCommerce companies use for fulfillment.
In piece picking, you take the packing slip for a single order. You move around the warehouse, picking the items for the order off the shelves. Once you have everything you need, you take the order to the packing station for packing. If your business is small, you might have only a few orders a day. In this case, piece picking may be the easiest pick and pack method to use.
Batch picking works well if you have enough orders to organize them into batches. Each batch of orders is for items that are in the same area of the warehouse. The goal of batch picking is to give pickers the most efficient path through the warehouse. If you need one SKU for several orders, it makes sense to pick those orders together. That will save time walking back and forth. Your orders will go out faster.
You can employ batch picking even if your business is small. Consider picking all your orders at one time each day. This method will be more efficient than picking and packing each order as you receive it. When you pick your orders all at once, you can batch them. Pick and pack software can help you batch orders for efficient picking.
Zone picking is a good technique for larger fulfillment warehouses. Pickers stay in a warehouse zone and pick the products located in their zone for each order. Then they pass off the order to a worker in the next zone. After an order moves through all the zones where items on the packing slip are stored, it goes to the packing station.
Zone picking requires complex coordination in your fulfillment warehouse. You’ll definitely need warehouse management software to help you manage zone picking.
Wave picking is a combination of batch and zone picking. Workers pick items within a zone for a batch of orders rather than a single order. Then they pass the batch to the next zone for picking.
Pick and pack warehouse setup
Many aspects of your eCommerce business may feel intuitive to you. You may have an excellent head for business. You might be skilled at organizing your workflow. When it comes to managing your inventory, however, throw intuition out the window. Chaos is your friend.
If you started small, you probably initially stored your inventory “like with like.” Say you sold blue dresses and yellow dresses. You probably lined up the blue with small, medium, and large on one shelf. Then, you did the same with yellow dresses on the next shelf.
This organizational method makes sense to us. It’s a logical way to organize our closets and drawers. Imagine putting some of your socks in your sweater drawer and one sweater with your t-shirts. It would take you forever to find your clothes and get dressed in the morning.
But your pick and pack methods will work better when you’ve organized your warehouse differently. When you line up all the yellow dress sizes together, you might grab a medium when you need a large. If you catch your mistake, you must return the wrong size to the shelf and pick the order twice. If you don’t catch it, you’ll have an unhappy customer.
To accurately pick, pack, and ship using the “like with like” inventory management system, you must move slowly. Slow picking will eat up your time and your profits. To move fast, you need to introduce chaos into your warehouse setup.
Chaotic inventory management
In chaotic inventory management systems, you place your products randomly on the shelves. A product will never be next to a similar product. The small-size yellow dresses will live next to the brown sandals, size 6. The large blue dresses go next to a beach umbrella, and so on. When you need to pick a large blue dress, you arrive at the shelf with blue dresses next to beach umbrellas. The only blue dress you can pick is the right size. You won’t mistake a beach umbrella for a dress. Your error rate will go way down.
To make chaotic inventory storage work, you need inventory management software. The software maps the products in your warehouse. When you print a packing slip, each item will have a location. Some software can also map the most efficient route through your warehouse so you can pick orders more quickly.
Volume and class-based inventory management
There are two more types of inventory storage. You can combine each with a chaotic approach to inventory management. The volume inventory storage method places the SKUs with the highest turnover closest to the packing station. Products that sell the slowest are stored in the farthest location. This minimizes the steps that pickers take during the day as they pick orders.
Another inventory storage system is class-based. Items are grouped together into classes based on a shared trait. Turnover rate is one way to classify products. Another class option is how items are packed. You could group large items that don’t require an overbox together. You could also group products by whether they get packed with kraft paper or bubble wrap.
Mobile shelf-based order pick systems
One innovation in pick and pack methods is mobile shelf-based order pick systems or MSOP. In this system, robots bring shelves to the picker and then return them to the warehouse floor. The picker stays stationary while the robots shuttle shelves of products back and forth.
Order packing best practices
There are several things to think about when you get to the packing part of pick and pack methods. You need enough infill in the box to protect the products during shipping. But you also want to ship the products in the smallest box possible to reduce DIM weight charges.
If you follow a few best practices during your packing process, you can reduce errors, returns, and shipping charges.
- Re-scan the products for each order to make sure the items on the packing slip are the ones you’re putting in the box.
- Don’t make packers guess the correct box size. Use pick and pack software to calculate the size of the box needed for each order.
- Include infill instructions for each order to improve your pick and pack methods. This allows the packer to reach for the proper packing materials for each order quickly.
After your orders are packed, they will go to the loading dock. They can be sorted for pickup by carriers such as FedEx, UPS, and USPS.
Pick and pack software
Pick and pack software can help you with the steps to create efficient and accurate pick, pack, and ship systems. Order fulfillment software can generate barcodes, batch orders, and perform inventory management tasks.
There are many choices for pick and pack software. You may want to use multiple apps that work together. These tools allow you to create a warehouse management software package that has precisely the features you need.
Navigating your pick and pack software choices can be confusing. We asked two highly-rated order and inventory management software makers for their advice. Here are recommendations for choosing the right software package for your eCommerce business from Stitch Labs and Skubana.
Stitch Labs designs software solutions for eCommerce businesses. The company’s software can help you manage inventory, logistics, fulfillment, and pick and pack services. We previously asked Stitch Labs spokesperson Emma Miller-Crimm for her pick and pack software advice for eCommerce businesses.
Note: Stitch Labs was acquired by Square in July 2020. The service is still available for existing customers, but not for new clients. Miller-Crimm’s insights are still very relevant and useful for companies trying to manage their own fulfillment.
You don’t have to spend a lot on software to get a significant value. “Because small eCommerce businesses are typically lean teams with limited resources, you need a system that will save you time and allow your business to focus on growth rather than the nitty-gritty,” Miller-Crimm told us via email. “Knowing your inventory and its value can make or break brands. Inventory management should be one of the first things brands think of when starting up — along with their eCommerce platform. This is because inventory are your assets, and you don’t want to mess around with the lifeblood of your business.”
Flexibility and ease of use are two key characteristics of pick-and-pack software. “ECommerce businesses should look for inventory management software that allows for agility and experimentation in their operations,” Miller-Crimm noted. “This means features that make purchasing easier, and a setup that allows for visibility into what inventory you have at any given time, and where it’s located at any given time.”
Miller-Crimm suggests that many apps are often better than an all-in-one solution. “We always recommend a best-in-class solution. This means combining the best software from each category to create a tech stack that suits your brand’s needs. This allows brands to remain agile and add or remove parts of their tech stack as they see fit,” according to Miller-Crimm. “All-in-one solutions inhibit brand growth because they are rigid in their operational choices.”
Skubana offers software to help eCommerce businesses manage orders, inventory, and analytics. The company’s Co-Founder Chad Rubin shared his wisdom on finding the best pick and pack software solution for your business.
Note: 3PL Central acquired it in April 2021. It continues to operate and offer services under the software brand.
Rubin advises being clear on what you need your inventory software to do first. Then start researching solutions. “You should understand what you want improved in your current inventory management process, as well as the different existing systems and applications that will need to function alongside the new software,” he said in an emailed response.
Rubin outlined the key features he thinks are most important, starting with multichannel integration. “The software you choose should be capable of integrating with major marketplaces like Shopify, BigCommerce, or Amazon. It should also have the flexibility to connect to the shipping providers and fulfillment sources (in-house, 3PLs, and drop-shippers) that comprise your operations,” he noted. You want a unified view of inventory and order fulfillment, “allowing you to marry your data better and generate accurate analytics to track performance.”
Another critical feature that Rubin highlighted is automation: “Inventory management software must automate key aspects of your business operations, from order fulfillment to product purchasing, so you can efficiently resource personnel and decrease the time spent on low-level, repetitive tasks. This includes capabilities to triage orders based on predefined filters or generate purchase orders based on cross-channel sales velocity and available inventory.”
Other key features of pick and pack software are an open API and cloud software. “An open API allows you to take the software beyond its native features, providing a level of customization to accommodate any operations structure or existing workflows,” Rubin noted.
Finale Inventory’s software helps eCommerce businesses manage orders, inventory, and warehouse operations. The company’s Co-Founder, Chinh Nguyen, has worked with eCommerce businesses for nearly a decade and shared his insight on finding the best pick and pack software solution.
Nguyen advises being clear on what your inventory management needs are for today and foreseeing what your inventory management needs will be in the future as your company grows and scales. Depending on your growth rate, think about two to five years into the future.
“As a result, you want to find a flexible, scalable, and customizable solution for your inventory management needs. Migrating software for a growing operation with an increasing number of SKUs, employees, and order volume is challenging, so you want to ensure the inventory management software can meet your needs today and tomorrow.”
“Asking questions about the limits of the software will assist you with the determination. How many users can the software support? How many orders per month can the software support? How many SKUs can the software support before it slows to a halt? It is a good sign to see larger customers in the same industry within their customer base.”
Your pick and pack operations may also need to change as the company operations grow.
“With smaller order volumes, piece packing or picking orders one-by-one may be sufficient. However, as your order volume increases, other packing methods will probably make sense, such as batch picking and wave picking. That, paired with a mobile barcode scanner, will increase your warehouse efficiency. It’s best to identify inventory software that can support multiple pick and pack operations.”
After labor costs, inventory is typically the highest cost for an eCommerce company. “Having an inventory system that will automate the most important business operations will allow you to sleep better at night. You want a solution that answers questions such as (1) What are the current stock level and the inventory valuation of the inventory (2) Where is product X located within the warehouse, and (3) When do I need to reorder product X based on sales trends and supplier lead times?”
Another important requirement is finding a system that integrates with the best-in-class software, such as Shopify for shopping cart software, QuickBooks Online for accounting, and ShipStation for shipping.
“Integrating the current market leaders may meet your needs for today, but you may expand to selling channels to increase your reach in the future. Identifying software with an open API will allow flexibility if you want to connect another 3rd party tool that software will support natively.”
Be cautious of single solutions
If you’re thinking of going it alone or managing your inventory in a spreadsheet, you’re missing out on a crucial business tool. “A good inventory management and fulfillment software can give a small managed business the platform to scale at an unprecedented rate,” Rubin said. “It makes it easier to process orders and returns, manage multi-warehouse inventory, complete vendor and purchase order workflows, and mitigate human error.”
Rubin sees some pitfalls in stacking multiple pick and pack apps. “There are so many pointed apps that specialize in specific services targeted to small managed businesses that it can become difficult to manage all of the integrations,” he pointed out. “This can lead to duplicative services, unstable hacks or workaround, and bad data, all of which ultimately result in wasted investments.
“This becomes a roadblock to growing into a multichannel business. More channels mean more data, and if you don’t have the infrastructure to easily bring that data together, it can result in significant time invested trying to splice it together using Excel documents and formulas.”
Is it time to outsource your pick and pack operations?
If your eCommerce business has grown beyond your fulfillment capacity, there is another solution. You can outsource your pick and pack services to a 3PL provider.
When you use a fulfillment warehouse, you get the benefit of a professional team. Your order fulfillment will benefit from the latest pick and pack methods. You can increase order accuracy and reduce shipping costs.
Here are just a few of the steps we take at Red Stag to make sure our pick and pack methods are perfect:
- Implement custom warehouse management software and update it continuously. This is the best way to offer the latest and greatest fulfillment solutions.
- Use barcoding to scan each order and each product multiple times. Build checks into the system. Verification prevents pickers from grabbing the wrong product. It’s also helpful to recheck each order during packing.
- Calculate exact box dimensions for each order. Feed this data into a custom box machine so your orders ship in perfectly sized boxes.
If your business is in a rapid growth phase, outsourcing could save you future headaches. If your need for pick and pack services outstrips your ability to ship orders, this could slow your expansion. A third-party fulfillment warehouse can free up your space and capital resources. This gives your business more room to grow.
Which pick and pack methods are best for your eCommerce business?
Most eCommerce businesses start small. It makes sense, at first, to run pick and pack operations in-house. As you grow, pick and pack software can help you scale your capacity while staying lean. In addition, handling your fulfillment has the benefit of teaching you about pick and pack methods. This knowledge will put you in a better position to find the right pick and pack services provider for you. When you’re ready to outsource your fulfillment, you can choose with confidence.
The right pick and pack services solution for your business depends on your business’s size and growth trajectory. Red Stag’s questionnaire can help you determine what 3PL services your business needs. If you still have questions, feel free to call Red Stag. We’re here to help you find your best pick, pack, and ship option, no matter what size your business is.
More about pick and pack fulfillment:
- Pick List Guide: Definition, Options, Best Practices
- Floor Loaded vs. Palletized Shipping Containers
- Cubic Storage Model: The New Industry Standard