Optimizing Your Ecommerce Fulfillment Strategy During a Pandemic
August 18, 2020
The COVID-19 pandemic has had a significant impact on ecommerce fulfillment. Retailers are dealing with manufacturing delays, product shortages, warehouses being shut down and various other shipping bottlenecks.
On top of that, there’s been a significant increase in consumer spending during this period. In the early days of the pandemic, we’ve seen people making panic purchases and stockpiling items like hand sanitizer, toilet paper, food and other necessities.
A few months later, we’re seeing consumers starting to spend more on apparel, electronics, health and beauty products. Even collectibles.
Both big and small retailers are struggling to keep up with consumer demand, as well as deal with fulfillment bottlenecks.
If they want to come out ahead, retailers need to adapt quickly and find a way to meet consumer demand while providing a relatively high level of customer service.
4 Ways to Stay on Top of Your Ecommerce Fulfillment Strategy
First, let’s face it — consumers’ high expectations won’t level off anytime soon. They might be more understanding about delays, depending on the product and their need for it, but only within reason.
In this post, we’ll go over how you can optimize your ecommerce fulfillment strategy during the pandemic to make your customers happy while maintaining a healthy bottom line. We’ll cover ways to future-proof your store, too.
1. Communicate with Suppliers
The first thing you should do is talk to your suppliers. This is a crucial step in optimizing your fulfillment strategy during the pandemic, and it needs to be done even if you’re currently not experiencing any fulfillment bottlenecks.
Contact your suppliers or manufacturers and ask them to inform you of how the pandemic might impact supply. Try to get as much information out of your suppliers as possible, and request that they keep you updated regularly.
2. Let Customers Know About Any Potential Delays
It’s hard for everyone right now. If you’re struggling to meet customer demand or fulfill orders at your usual pace, you need to let customers know about it.
Be honest with them and let them know about any potential delays in shipping or delivering their order. Provide all the information customers might want to know about shopping with your business during the pandemic in an easy-to-access location.
Consider creating a dedicated page containing answers to frequently asked questions about making purchases during the pandemic. You can then link to this page in your emails and social media posts to make sure all your customers see it.
3. Use Advanced Picking Strategies
If you’re fulfilling orders from your own warehouse, you should consider using advanced picking strategies to have an easier time handling the increased demand for your products.
We suggest using one of the following four strategies:
Instead of picking one item at a time, your workers can pick items for multiple orders during a single picking trip. This can reduce order picking travel distance and increase warehouse productivity, allowing you to ship more orders while using fewer resources.
Voice picking involves equipping warehouse workers with headsets through which they receive automated instructions that tell them where they need to go and which item they need to pick.
A voice-picking system can automatically optimize the pick path, making sure that the worker takes the most efficient route when picking an item.
This type of picking solution frees workers from having to look at their screens, allowing them to focus on the items they need to pick. It improves both accuracy and productivity, as well as allows you to onboard new employees faster.
Voice picking also comes with the following benefits:
Improved accuracy: Voice picking helps improve picking accuracy by reducing the number of distractions that could occupy employees’ attention and providing simple instructions that everyone can understand.
Shorter employee onboarding: It can take days (or even weeks) to train someone how to do traditional picking properly. Voice picking is a lot easier to learn because employees don’t need to do complicated data entry, paperwork or labeling.
Increased safety: With fewer distractions, there will be a lower chance of workers injuring themselves, resulting in greater workplace safety.
Improved employee satisfaction: Voice picking makes it easier for warehouse workers to do their job, which, in turn, improves overall employee satisfaction.
With zone picking, stock-keeping units (SKUs) are divided into different zones, with workers being assigned a zone each. When picking items, each worker picks items from their zone and then passes them to the next worker.
This method of picking is especially useful for retailers whose warehouses stock a large number of different SKUs because it allows them to group slower and faster-moving SKUs together. This, in turn, helps to increase picker productivity and cut travel time.
Zone picking also helps:
Reduce warehouse congestion: By allocating workers to specific zones, you’ll be able to control how many people are walking through a particular area. This will allow you to avoid having crowded areas in the warehouse where employees could procrastinate or get in each other’s way.
Train specialized workers: By assigning workers to specific zones, you’ll help them get specialized with a particular category of SKUs. This, in turn, will enable them to have an easier time identifying products and help improve their overall picking efficiency.
Most warehouses have high-density pick zones for fast-moving SKUs, while slower-moving ones are dispersed over a large area. This makes picking slower-moving SKUs highly inefficient, which results in higher labor costs per unit.
Retailers can address this by implementing two-stage picking, which involves separating slow-moving SKUs into a dedicated zone and pre-picking them for multiple orders in a single batch. These SKUs are then placed near the picking area for fast-moving SKUs, with a picker who has completed picking fast-moving SKUs for an order directed to pick the pre-picked items next (stage two).
This helps to significantly reduce travel time and improve worker productivity.
4. Consider Transitioning to Third-Party Fulfillment
Third-party fulfillment is a highly scalable fulfillment solution that can provide your business with flexibility, as well as help you reduce risk by allowing you to store your inventory in multiple locations.
Additionally, by being a company that specializes in fulfillment, a third-party fulfillment provider will be best equipped to comply with regulations and guidelines and ensure your fulfillment process is as optimized as possible. Using third-party fulfillment will frequently result in a reduced cost per order and faster delivery times. This is especially true for smaller businesses that use less advanced fulfillment processes.
When looking for a new third-party fulfillment partner, you’ll want to consider the following:
Location: Identify where the majority of your orders come from and prioritize providers that have warehouses in those areas. You’ll also want to look for providers that have warehouses in multiple areas so you’ll be able to offer faster delivery times to your customers.
Shipping rates: While getting good shipping rates should be on your list of requirements when looking for a third-party fulfillment provider, it shouldn’t be a deciding factor. Most providers offer similar rates, so you’ll want to look for something more than that.
Integrations: Your new third-party provider should integrate effortlessly with your existing systems, such as your ERP and order management system.
Return process: When considering a particular provider, you should inquire about the way they handle returns and make sure that they have an efficient process in place that will reduce delays and make your customers happy.
Customer support: Finally, make sure your new provider offers excellent customer support and that you’ll be able to get your questions answered and your issues resolved as quickly as possible.
Prepare for the Next Supply Chain Disruption
Once the pandemic is over, you shouldn’t go back to doing things the old way. Instead, put in the resources to prepare for a potential supply chain disruption that might occur in the future.
This will ensure your business is ready to weather any sort of crisis that could affect your supply chain.
Follow these steps:
Create an Emergency Plan
The first step to preparing your business for a potential supply chain disruption includes creating an emergency plan. Put some thought into what kind of events could disrupt your business’ supply chain in the future and then plan how you should adapt in order to prevent a catastrophe.
Test Your Emergency Plan
It’s not enough to have an emergency plan that looks good on paper — you need to test and continuously update your emergency plan to make sure it’s still viable. You should test your emergency plan at least once every year while making sure to note and fix any issues you encounter.
Build Up Your Inventory
You’ll also want to build up your inventory to prevent product shortages and eliminate the possibility of losing sales and revenue because you don’t have enough products in stock to meet increased demand.
Perform a Supply Chain Audit
If you’re not doing this already, you should periodically perform a supply chain audit to identify potential weak spots in your supply chain. This will allow you to improve parts of your supply chain before they cause more issues for your business.
When conducting a supply chain audit, you’ll want to examine your strategy, organization structure, supply processes and the technology you use to support your supply chain. Then, you should come up with an action plan for improving your supply chain and determine what resources you need to execute it.
Find Backup Suppliers
Having backup suppliers is crucial for being able to successfully handle a supply chain disruption. It’s best that you find backup suppliers before you actually need them to make sure that they’ll be able to step in when your regular suppliers aren’t able to provide you with the products you need.
The pandemic has significantly impacted ecommerce fulfillment during the past few months. On top of increased demand, retailers are also having to deal with product shortages, manufacturing delays and a host of other issues.
During this time, it’s crucial for retailers to communicate with their suppliers, as well as let customers know about any potential delays. It's also a good time to reflect on overall practices to see what, if anything, needs to be improved.
COVID-19 taught us some hard lessons: Now's the time to focus on improving what you can and future-proofing your store.
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Boris Mustapic is a writer and content marketing specialist with a decade of experience in the digital marketing industry. Having built his own successful ecommerce business, he likes to share his knowledge with ecommerce enthusiasts. Apart from writing about marketing and ecommerce, Boris also enjoys a good book and a glass of red wine.