How to Manage Warehouse Inventory for Drop Shipping

drop shippingIn the past few years, warehouses have changed. In fact, the entire logistics industry has changed. The advent and increase of customer-driven e-commerce has turned what used to be a straightforward, relatively predictable business cycle and distribution model into a constant balance between picking speed, delivery speed, and, of course, those dreaded small parcel and LTL shipping logistics. Every warehouse is different, but here’s what the warehouse experts at Scanco say about how to manage warehouse inventory for increased customer orders that require drop shipping.

At Scanco, we’ve spent the past 26 years helping warehouses stay on the cutting edge of the latest fulfillment trends, and we’re always happy to share our insight. Contact us for a free consultation if you want to learn more about how you can optimize your warehouse for those ever-increasing e-commerce orders.

It’s Time to Rethink Your Pick-and-Pack Strategy

I’m going to come right out and say it immediately: It’s time for distributors to rethink the traditional wave picking method. I don’t say this to be argumentative. After all, I know wave picking is time-tested, highly effective, and very easy to organize. However, it’s just not efficient. (In case you don’t use wave picking or call it something else, I’ll clarify: I’m talking about the method of batching picks in “waves” that send their employees scurrying across the warehouse floor to find goods and pack them.)

The reason why this method is effective is because by keeping initial pick numbers manageable, it’s easier for both employees and supervisors to ensure that packed orders are accurate and complete before they go out the door. It also ensures that a stream of orders is always being completed, which helps keeps warehouses on schedule; however, its effectiveness is based on an old model of distribution.

Why Wave Picking Is Inefficient for E-commerce

Wave picking helps companies easily organize large, diverse orders—the kind of orders you’d typically send to a retail partner or other B2B contact. However, the small order sizes that direct-to-consumer (D2C) transactions usually create can waste your employees’ time by having them literally walk to the same area over and over to repick a popular or trending item again and again.

Wave picking won’t help you solve this problem, because batch queues tend to be relatively inflexible, meaning that more than one of your employees could be returning to pick up that same item over and over again throughout the course of a day.

Not only is this inefficient and wasteful of resources, it also irritates your employees, which, in turn, makes them less productive.

How to Manage Warehouse Inventory for E-commerce

The current e-commerce growth is not expected to slow any time soon—in fact, its popularity keeps increasing each year. According to eMarketer, online sales growth in 2016 reached a total of $1.915 trillion, which was a 19% increase over the 2015 numbers. It’s time you updated your systems to meet demand.

One popular way to manage inventory these days is to employ an “order streaming” method, which provides flexibility to warehouse supervisors in the way they:

  • Assign orders
  • Prioritize orders
  • Manage order-fulfillment speed

However, order streaming requires real-time alignment between your systems and your on-the-floor productivity, which takes in-warehouse order tracking and insight into your employee efficiency. A system like this may sound super futuristic, but we’re proud to announce that it’s here. Dashboard by Scanco helps your Sage 100 warehouse perform better, faster, and more flexibly so you can optimize your warehouse inventory management in our e-commerce age.

Choose a Better Warehouse Management Method

The times certainly are changing and, unless your distribution company changes right along with the times, you’re bound to fall behind. It’s time you rethought how to manage warehouse inventory so that you can keep pace with how businesses and customers have updated their shopping in the e-commerce world. Contact the Scanco experts online to learn how you can meet current purchasing trends easily, or call us directly at 1-877-SCANCO-1.