Order picking in the fulfillment warehouse: process optimization

The efficiency of warehouse operations is a crucial factor determining the success of e-commerce companies in the market. Fulfillment warehouses, the heart of e-commerce logistics, play an essential role in ensuring the smoothness and speed of deliveries. The central feature of these operations is order picking in the fulfillment warehouse, which directly affects customer satisfaction and the company’s cost efficiency.

According to data published by MWPVL International, costs related to the picking process in fulfillment warehouses can constitute up to 55% of the total operational warehousing costs. In such a context, even minor improvements in space organization and picking methods can result in significant savings and efficiency improvements. Additionally, the “Future of Fulfillment Vision Study” report conducted by Zebra Technologies indicates that 78% of logistics companies have implemented modern technologies by 2023 to meet the growing market expectations in terms of speed and accuracy of deliveries.

Faced with this data, more and more e-commerce companies and logistics operators are looking for effective ways to optimize their warehouse processes. This article aims to present the latest trends and methods in the organization of warehouse space, which contribute to effective order picking in a fulfillment warehouse. We invite you to read it, a guide to the best practices in warehouse space management aimed at developing a competitive advantage in the e-commerce market.

 

Basics of organizing warehouse space

The fundamental principles of effective space organization in a fulfillment warehouse focus on several areas that help increase efficiency and customer satisfaction and reduce operating costs.

First, in the e-commerce business, the customer is the most important, so focusing on him allows you to introduce methods that will satisfy him at the end of the goods delivery path. Therefore, the fulfillment operator faces the challenge of optimizing order fulfillment processes and ensuring timely deliveries with shipments that meet the standards and expectations of end customers. This allows you to deliver the selected goods reliably, positively impacts the development of business relationships, and increases customer loyalty to the e-commerce store.

In the same aspect, attention should be paid to the design process in cooperation with a fulfillment service provider. When dealing with a multifaceted design process, it is important to ensure regular consultation with contractors, managers, operators, equipment suppliers, builders, and architects with whom key design options can be agreed upon. At the same time, they must be assessed against achieving objectives through quantitative and qualitative analysis to ensure that the options are well-considered and cost-effective​​.

Order picking in a fulfillment warehouse – warehouse strategies

Thus, let us smoothly move on to warehouse strategies, which are equally crucial for successfully organizing space for a well-functioning picking process.

These strategies include those related to storage. We can distinguish activities such as cross-docking, where incoming goods are directly transferred from incoming vehicles to outgoing vehicles, bypassing long-term storage. This is important for reducing inventory maintenance costs and speeding up order fulfillment.

Using the right warehouse inventory storage system is, in turn, the key to optimizing picking, packing, and shipping processes, which ensures order accuracy, efficiency, and speed​​.

Inventory management is essential to determining the amount of inventory, the storage space needed, and the best warehouse plan for your needs​​.

Another strategy is related to order picking. Effective picking strategies such as zone picking, where the warehouse is divided into different zones, and each picker is assigned to a specific zone, can improve efficiency by shortening picking times and reducing the distances between the locations of individual items.

However, training warehouse staff is equally important. You need to ensure that those managing your warehouse are satisfied with their job and well-informed about expectations and how they can be successful in their roles. Introducing a new warehouse layout requires creating a training procedure so that every warehouse employee knows the flow and how to maintain smooth movement on the floor plan​​.

In this process, applying and implementing the 5S methodology in the warehouse is useful. An experienced logistics specialist knows that it can significantly increase productivity, reduce waste, improve safety, and increase the satisfaction of employees and, consequently, customers.

Finally, it is also worth mentioning the strategy of minimizing manual handling. One of the main goals of warehouse layout optimization is to reduce the manual handling of goods to 3-5 touches while they are in stock because more touches mean higher costs​​.

FIND OUT MORE ABOUT WAREHOUSE MANAGEMENT: https://oexfulfilio.com/en/an-innovative-approach-to-fulfillment-in-e-commerce-how-to-reduce-costs-and-improve-efficiency/

Modern picking methods in the fulfillment warehouse

When discussing modern picking methods used in fulfillment warehouses, it is worth paying attention to modern technologies such as light-based picking (pick-to-light), voice picking, and picking using robots and automation. Each of these methods offers benefits that contribute to increasing the efficiency of the picking process, reducing errors, and improving work ergonomics.

Light-based picking (pick-to-light) in the fulfillment warehouse

This method involves using light indicators that direct warehouse workers to the correct locations with goods, significantly increasing the accuracy of picking. For example, in the case of a pick-to-light system, the average order-picking accuracy can reach 99.4%, which means that out of a million orders, only 6,000 would be incorrectly picked. This highlights the importance of implementing such technologies to maximize order accuracy​​.

Voice picking in the fulfillment warehouse

Voice picking uses speech recognition technology to direct employees to product locations and confirm completed actions using voice commands. This allows for a more natural and ergonomic approach to the picking process.

Automation and picking robots in the fulfillment warehouse

Automation and robots supporting picking processes are changing the face of fulfillment warehouses, offering not only improved speed and accuracy but also reduced operating costs and better work ergonomics. It may include a variety of technologies, from simple transport systems to advanced mobile robots that support or completely replace human work in the picking process.

OEX Fulfilio, as a company adapting its solutions to the constantly developing needs of e-commerce customers, can use the methods mentioned above to meet market expectations and ensure quick and error-free order execution. The implementation of such modern technologies allows not only the optimization of warehouse processes but also the increase of customer satisfaction through faster and more accurate order fulfillment. The goals related to picking processes are also followed by key business goals, such as increasing efficiency, reducing errors, improving work ergonomics, and consequently – increasing competitiveness in the e-commerce market.

LEARN MORE ABOUT THE ORGANIZATION OF SPACE IN THE FULFILLMENT WAREHOUSE: https://oexfulfilio.com/en/optimizing-space-in-fulfillment-warehouses-for-efficient-picking/

Order picking in the fulfillment warehouse – technological support

Technological support for the picking process, including warehouse management systems (WMS) and classification systems, plays a vital role in the efficiency of warehouse operations. WMS, as software designed to supervise and optimize various processes in a warehouse or distribution center, supports the reduction of error margins while minimizing operational costs. As is widely known, the primary business benefit of using WMS systems is increasing overall productivity by automating routine tasks such as inventory tracking and order picking.

Other benefits of implementing WMS in logistics operations are:

Real-time Inventory Tracking and Control

WMS provides unprecedented visibility in the warehouse, eliminating situations where inventory becomes forgotten, lost, or improperly placed​​.

Improved Order Fulfillment and Accuracy

Intelligent WMS algorithms optimize order-picking routes, reducing picking time and minimizing the likelihood of errors, enabling companies to offer same-day or next-day delivery options​​.

Efficient Space Optimization

WMS transforms warehouses from simple storage facilities into dynamic, highly efficient spaces, ensuring that every square centimeter is used efficiently, which translates into reducing the need for unnecessary expansions or rented warehouse facilities​​.

Additionally, WMSs improve the efficiency of inventory management by monitoring inventory levels, increasing the efficiency of picking processes, and improving order fulfillment processes. By automating various inventory management processes, WMSs provide all the necessary information to run warehouse operations smoothly without having to spend valuable time searching for data.

A WMS also plays a key role in the supply chain, managing order fulfillment processes from receiving raw materials to shipping finished goods. It ensures that the entire operation is kept in order, that goods are stored and sorted correctly, and that they are shipped and tracked accurately​​.

Choosing a logistics partner that uses a modern WMS system is crucial for your company’s scalability. As your business grows, managing your warehouse and inventory will become even more complex. Therefore, it is important to invest in cooperation with a logistics company that will grow with your company, even if you do not use all WMS functions at the beginning.

Order picking in a fulfillment warehouse – benefits from process optimization

Optimizing the picking process brings significant benefits for e-commerce companies, which can translate into an increase in the speed of order fulfillment, reduction of operational costs, and improved customer satisfaction. Automation of the picking process eliminates the need for manual data entry and optimizes warehouse management for better inventory management, increasing delivery speeds​​.

For example, systems like Shopify Fulfillment Network allow you to automate various aspects of order processing and shipping, from inventory management to selecting the most cost-effective shipping options. By centralizing these functions, real-time tracking and faster execution are possible, making the entire picking process more efficient​​.

At OEX Fulfilio, it is a practice to integrate with client-side systems, which is why real-time tracking is one of the benefits that allows for 24/7 tracking not only of the shipment routes but also care of returns and complaints.

Applying optimization and automation to the e-commerce picking process, as indicated on Data4eCom, can include integration with order management systems (OMS). This provides visibility at every stage of the order, from inventory to order status, enabling faster and more efficient order processing​​ .

One of the key benefits of picking optimization, as shown by the Material Handling Institute (MHI) study, is a potential cost reduction of up to 40%, including savings on labor costs, reduced warehousing expenses, and optimization of transportation routes​​.

In addition to operational improvements, optimizing your picking process can also increase the scalability of your retail business by adapting to growing order volumes and expanding product catalogs, providing the necessary scalability to support business growth​​.

Implementing advanced warehouse management and picking optimization systems can give e-commerce companies a significant competitive advantage by offering faster, more accurate, and more cost-effective services compared to competitors, improving overall customer satisfaction and loyalty.

Order picking in a fulfillment warehouse – challenges and problems

During the picking process, fulfillment warehouses encounter various challenges that may affect efficiency and customer satisfaction. One such problem is packaging errors, which can lead to goods being damaged during transportation, increasing the number of returns and negatively affecting the company’s image. To avoid these mistakes, companies can optimize packaging materials and methods and comply with carrier regulations regarding packaging and labeling​​.

Partnership with courier companies

Another challenge is delivery delays and shipment damage, which can negatively impact the customer experience. Partnering with reputable carriers and investing in high-quality packaging materials can help reduce the risk of delays and damage​​. OEX Fulfilio cooperates with the largest courier companies that ensure the policy of delivering parcels without damage.

Order picking warehouse management

Warehouse management is another area where problems can arise, such as inefficient order picking routes or poor staff management, leading to delays and errors. Implementing warehouse layout optimization and warehouse management systems (WMS) can significantly improve the efficiency of the picking process​​.

Scalability of fulfillment solutions for order picking

Scalability challenges are especially acute during seasonal order peaks, when companies need to quickly and efficiently increase their processing capacity without significantly increasing costs. Investing in scalable fulfillment solutions, such as flexible warehouse management systems and advanced automation technologies, can help companies manage changing demand​​.

Omnichannel fulfillment

The comprehensiveness of omnichannel fulfillment, including the management of multiple sales channels, is another challenge. Investing in omnichannel fulfillment platforms and integrating order and inventory data across all sales channels can help manage these complexities​​. Recently, OEX Fulfilio has strengthened cooperation with the SellerSwitch agency, which supports the implementation of sales on popular marketplaces in Poland and abroad.

Managing seasonal sales peaks

During seasonal peaks, such as the holiday season, businesses may face challenges in managing increased order volumes and inventory. Partnering with trusted 3PL logistics providers, leveraging modern technologies to manage volume fluctuations, and ensuring a flexible workforce can help manage these challenges​​.

By understanding these challenges and applying appropriate strategies and technologies, companies can significantly improve the efficiency of the picking process, reduce costs, and increase customer satisfaction and loyalty.

Summary

To sum up, effective organization of warehouse space and optimization of the picking process in fulfillment warehouses are the foundations necessary to maintain competitiveness in the dynamically changing world of e-commerce.

In the future, we can expect further development and innovation in the area of ​​picking and organizing warehouse space. Solutions such as artificial intelligence (AI), machine learning and robotics will have an increasing impact on the automation and optimization of warehouse processes, leading to even greater efficiency and adaptability of warehouses to market requirements. Additionally, the growing importance of sustainability and green practices may shape future approaches to warehouse design and management, highlighting the need for innovative solutions that are not only efficient but also sustainable.