The Satellite Review Magazine The Satellite Review Magazine Vol 1 | Page 11
CHALLENGES OF
e-COMMERCE
Combating the Challenges of
E-Commerce with Automation
Technology
By John Hinchey,
VP of Sales, Westfalia Technologies, Inc.
It goes without saying that the Internet
is changing the way we do business, no
matter the industry. For the retail supply
chain, e-commerce is rapidly shifting the
entire paradigm. In a recent report,
Forrester projected that e-commerce
sales across 30 retail categories will
reach $293 billion by the end of 2014.
That number is expected to grow to
$414 billion by 2018.
While the e-commerce business model
can certainly lead to increased sales
and greater customer satisfaction for
retailers, it has placed more pressure
on manufacturers and distributors.
Traditionally, manufacturers have
picked and moved goods in pallets for
bulk distribution to brick and mortar
retail locations. But with orders coming
in via e-commerce platforms for direct
-to-consumer fulfillment, manufacturers
are now required to pick and sort
individual items, rather than cases or
pallets. As a result, many manufacturers
are relying on manual or hand picking
methods, which entail more labor and
complex inventory management
policies.
At the same time, consumers expect
to receive their orders as quickly as
possible, so there is no leeway for
picking inefficiencies. Essentially, the
order fulfillment process has become
faster than ever, where the time to
pick, pack and ship is now measured
in minutes rather than hours. Time is
of the essence.
Further complicating the picking
process is the existence of
multiple warehouses in dispersed
locations. Consider the following
situation: a customer places an
online order for three different
pairs of shoes. One is located in a
warehouse center in Florida, while the
other two are sitting in a warehouse in
Michigan. Fulfilling the order (quickly
and accurately), necessitates extra effort
to aggregate all items and send them to a
single destination.
Of course, e-commerce is not limited
to consumer goods like apparel,
electronics, and entertainment (think
e-commerce behemoth Amazon.com).
The food and beverage industry,
although late to the party, is beginning
to embrace e-commerce platforms.
However, order picking efficiency is
of even greater importance for food and
beverage companies who deal with
perishable items. These manufacturers
must look to same-day delivery methods
that require higher throughput rates and
high-speed operations.
To combat the challenges brought
on by the growth of e-commerce,
manufacturers and distributors across
industries are turning to automation
technology. With automation,
manufacturers are bringing a new
level of efficiency to their fulfillment
processes to support same-day
distribution , drive customer satisfaction,
and maintain a competitive edge.
www. WestfaliaUSA.com
A key piece of e-commerce fulfillment
is automated picking systems, which
coordinate the activity of Automated
Storage and Retrieval Systems (AS/RS).
Such systems can not only systematically
pick cases and layers, but also individual
products. This eliminates laborious
manual picking processes and expedites
the time it takes to get product out the
door and into the hands of the customer.
Simultaneously, automation ensures
accuracy and reduces product damage,
leading to fewer returns and happier
customers.
Automation also alleviates the
aforementioned challenge of disparate
warehouses. By introducing highdensity AS/RS, manufacturers improve
their cube utilization and store more
products in one place. This greatly
simplifies the fulfillment process by
enabling easier picking and shipping and
lowers travel time.
With e-commerce showing no signs
of slowing down, manufacturers who
invest now in automation technology are
positioning themselves to dynamically
adapt their fulfillment processes to take
advantage of this tremendous growth
opportunity.
The Satellite Review
11