by Steve Williams
When was the last time you reviewed your shipping processes to identify opportunities for improvement? Whether your company is undergoing a new growth spurt in orders or you've been handling a high volume for quite some time, it's likely time to reevaluate your shipping processes for more efficient and effective solutions.
Here are a few ideas to consider to boost warehouse productivity and lower shipping costs for your business.
Read the Guide: 9 Ways to Reduce Warehouse Management Costs
Is your team spending much of the day manually entering package details into the shipping system in order to process the shipment and generate shipping labels and documents?
If so, you can achieve immediate efficiency and savings by connecting your "host" (order entry, WMS or ERP) system to electronically transfer the orders into the shipping system. This approach offers three significant advantages for domestic and international shipping.
Faster & More Accurate Order Fulfillment
First, electronically transferring data between your host and shipping systems eliminates manual keying and dramatically reduces shipment processing time. The process of manually keying order data into the shipping system can easily take 30 seconds or more, versus an almost instantaneous data transfer from your host system.
"Time savings of 30 seconds per package and multiplied over hundreds or thousands per day, shows how substantial the labor savings can be."
Also, by automating the data transfer from your host to the shipping platform, the risk of incorrect manual entry of shipment details is eliminated. With some of the parcel carriers charging high address correction fees these days, your warehouse team will no longer be generating these fees because they “fat-fingered” an address. This also reduces the number of packages with errors that need to be rerouted or returned to the warehouse, delaying the delivery and affecting the customer experience.
For example, if you ship 1,000 packages a day, creating an interface to your host system would save you roughly 8.3 labor hours per day. That’s the effort of an entire team member, which can then be reallocated to other functions within the warehouse to increase efficiency.
Elimination of Dependency on "Tribal Knowledge"
Let’s say Jen, your “shipping guru” has been with your company for 15 years, and knows EVERYTHING about your customers, including how they like their orders to be shipped. Customer A only wants their packages to be shipped via UPS, while Customer B wants their packages immediately, so it better be FedEx Overnight or it's getting returned.
Now, what if Jen suddenly becomes completely unavailable for the next six months due to an accident? What happens? Jen is the only one who knows "this stuff." Suddenly, you're facing a knowledge gap that can shut down operations and affect customer deliveries and satisfaction.
Make it a MUST to avoid this risk. Instead, transition to a multi-carrier shipping system that allows you to automate your company’s and customers’ shipping preferences so they're automatically applied by the system. In this way, you can be assured that shipping operations will not be disrupted by the loss of key employees.
Guaranteed Lowest Cost Delivery Decisions
Oversight is something else to consider. In many operations, employees make carrier and service decisions as they process the shipments. This approach does not ensure that cost is correctly considered for every order, nor is the right carrier selection decision uniformly applied by every employee.
For example, a team member in the warehouse may not know that carriers will generally "commit" to delivering a package within about 150 miles, next day. If you're based in Baltimore and are shipping to a customer in Washington D.C., this is only a distance of roughly 40 miles. If the customer wants their items tomorrow, shipping via ground service from a parcel carrier such as UPS, FedEx, etc., will get it there in time.
The problem is that your shipping clerk Mike doesn't know this. All he knows is that it must be there tomorrow, so he chooses an overnight service, which can cost potentially five to six more times more than a ground service offering the same delivery time.
These higher shipping costs can easily be avoided by implementing a multi-carrier shipping system that is configured to take these types of scenarios into account. A well-configured shipping system eliminates the need for employees to be involved in the decision-making process and ensures that each package is routed via the optimal service, based on the customer-selected delivery time, at the lowest possible shipping cost.
Batching is the process of shipping a set of shipments in bulk, all at once. One option is to process a set of orders containing the same items.
For example, a sporting goods company that has a new golf glove on the market, and receives 100 orders that will be shipped out today. These orders can be imported/transmitted to your shipping system, processed as a batch so that all 100 shipping labels are produced.
Now 100 sets of gloves can be brought to a staging area, packed, labeled, and they're ready to be handed to the carrier(s). Batching the work in this way dramatically reduces the time and labor required when compared to the time it takes for each order to be separately picked, packed and shipped.
A second method is to process a group of orders, regardless of the items, and print the items contained within each order on the shipping label. These labels can then also be used as pick tickets for workers to pick the items and group them with the items to be packaged at a pack station. If the items are already pre-packaged, the labels can simply be applied to the packages and they're ready to be loaded onto the carrier trailer.
III. In-Motion Systems
In-motion systems are another method for warehouse optimization. By leveraging conveyor belts and automatic scan/print equipment, you can eliminate or reduce the need for actual shipping workstations where employees process each package.
Instead, the package is placed onto the conveyor, and as it makes its way down the belt, the automatic scan/print system scans the package's unique barcode to trigger specific fulfillment steps for that specific order.
And as the package moves along the conveyor, the shipping platform processes the order and applies the shipping rules in the background, the shipping label is generated and automatically applied by an inline label applicator.
Speeding up your shipping process delivers efficiency improvements that can directly impact your business, whether your goal is to enhance customer satisfaction, increase throughput, or reduce labor and freight costs. As the examples above illustrate, you can save time, improve decision making and accuracy by applying automation, batching, and/or implementing in-motion systems.
Keep in mind, there is no "one size fits all" shipping software solution for companies that will guarantee faster and more efficient shipping processes. We recommend an internal audit of your workflow to ensure you're choosing the best shipping system for your needs.
Taking the time to perform this due diligence, when viewed along with needs and goals of your business, will ultimately determine the best option for your warehouse fulfillment operations.
How can we help? CLS has the industry, freight management, and carrier expertise and the shipping platform to help you address peak season carrier capacity challenges. Our team of shipping experts can help you weigh your options in considering zone or hub skipping, or other shipping methods to ensure that your shipments are delivered. Our multi-carrier shipping software, InfoShip®/Vx, is also already connected to many leading regional small parcel and LTL carriers, which may be helpful to you.
Steve Williams, Director of Professional Service at Creative Logistics Solutions, Inc., has a background in economics and business, with several years of experience outlining and integrating InfoShip/Vx into the operations of CLS clients. He works directly with clients to identify operational improvements and process automation, and brainstorm optimal solutions to address their specific obstacles and goals.
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