Direct-to-Customer Commerce

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Strategic insights into the direct commerce industry, including ecommerce, direct marketing and related fields

The fourth step to multichannel commerce

Step 1 = a single, unified product master

Step 2 = a cross-platform, multi-channel order management system

Step 3 = a single view of inventory, updated in near-real-time.

Step 4 = a warehouse management system capable of item-unit-picking and parcel shipping (fulfillment processing)

More and more warehouse operators are coming to an appreciation of the differences between shipping to stores and shipping to consumer.  For those who don’t, the most typical problem is that both processes use similar terms, but the definition of the term varies with the environment within which you’re working.

Picking for a shipment to a store, is often at the case level.  Picking for a consumer is almost always at the unit level.  A case contains multiple units of a single item.  Pallets contain multiple cases, which may be of a single unit or mixed units — but all in cases.

Fulfillment of consumer orders usually requires:

  • more complicated picking instructions
  • variable picking strategies
  • more difficult packing (read “slower”)
  • slotting optimization (to reduce picker travel time)
  • more sensitive cut-offs for picking orders
  • coordination with multiple parcel carriers (USPS, UPS, FedEx, DHL and others) for pick ups based upon class of service (ground or expedited)
  • near-real-time updating of order status and inventory status

These are just the highlights … the actual list goes on much longer.  I’m only trying to highlight the differences between retail fulfillment and consumer fulfillment.

More and more Warehouse Management Systems (WMS) are capable of handling both retail and consumer fulfillment.  So, the more difficult matter is personnel management and scheduling.  In a typical retail operation, staff peaks in August-September for shipping Christmas inventory to stores.  And the staff increase is 20-30 percent over base levels.

However, for consumer fulfillment the increase in staff may reach 200-500 percent and run from early November thru mid- to late-December.  This dramatic increase puts a premium on the ability of Human Resources to hire quickly and well; plus the ability to train new people on any specialized tasks.

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