E-commerce has been upward trending for nearly a decade, experiencing its largest spikes in the last few years. Unfortunately, so much of the supplier market has not prepared themselves adequately to address the new, high levels of demand that are being introduced by online customers. Warehouses used to only need to supply to company-owned, brick-and-mortar locations. However, with the rise in product availability, resellers, and overall end-consumer online shopping, new distribution management practices must be instituted to operate efficiently and effectively against the competition.
More advanced technology has entered the market as fast as e-commerce customer demand has grown, and the time is now for businesses to adopt these warehousing and distribution management practices if they want to take advantage of the high consumer demand levels on the market.
Distribution Management Practices: 5 Practical Steps
1. Use Technology to Your Advantage
Warehouses and distribution processes used to be managed via archaic, paper and pencil methods. While there are very few in the industry who still abide by this age-old way of doing business, technology gets old as well. New technologies have capabilities of automated tracking and tracing, and even automatic ordering when stock runs low. It essentially consolidates the mundane work managed by 5 floor employees into one, automated system. Research more about automated inbound transportation, and TMS software to see what your company could benefit from.
2. Reorganize Your Slots
Every warehouse is different, but most utilize slot organization for some reason or another. The issue with slotting is that it takes up time – and a lot of it. Browsing through rows of slots to figure out next order quantities and stockouts can be a headache.
It is in your best interest to reorganize slots so that items which are more frequently out-of-stock are located near each other. This helps to make the identifying and ordering process quicker, and further streamline product management.
3. Establish Inbound and Outbound Freight Management Practices
Most of this is derived from your company’s routing guide. The routing guide will specify all outbound and inbound freight needs, responsibilities, and management needs for all parties involved in the shipping process (you and all other vendors.) Following certain stocking methods, such as just-in-time, or FIFO stocking methods can help to further optimize your warehouse management and operations. Inbound and outbound freight management can get messy if you don’t have a routing guide. There are plenty of templates available online, as well as consultants who can build one for you. In fact, Interlog USA has experience building routing guides in case your company is interested in making one.
4. Outsource Operations in Peak Seasons
There is nothing wrong with outsourcing your company’s systems, operations, or warehousing during peak seasons. When demand exceeds your usual service accommodations, make sure you have a list on hand of potential vendors you can work with closely. The key is to only outsource that which is necessary. Whatever you and your company are capable of handling on your own, do so. But it’s worth the added cost to protect your company’s customer service reputation level by sticking to your word and fulfilling orders in a timely manner.
5. Look for Insights into Visibility of Operations
Everyone wants more visibility into everything. Visibility creates an awareness, an awareness creates accountability, and accountability creates production. And with modern day technologies, gaining visibility into warehouse operations is easier than ever. Find a TMS software (or other warehouse and distribution software) that can cater to your company’s needs to provide visibility into floor operations, product sales, orders, and costs. You’ll have to set a budget here, as there are tons of options for each price range on the market. A company like Target is utilizing incredibly complex TMS systems, whereas a small retailer in your home town may be using a bare-bones, cheap software solution to manage and track floor progress.
Most problems for companies in regards to distribution management practices revolve around archaic technology and incorrect delegation of responsibilities. If your company hasn’t upgraded their TMS software or warehousing technologies, now is the time. TMS software can provide insight into floor operations, product order needs – they may even order products automatically –, and instant product profit margin reports. Also be mindful of how much work you are attempting to control yourself. Don’t be afraid to outsource distribution management and warehousing during the peak seasons of business.
As always, call Interlog USA if you have had (or are currently having) distribution management issues. Our team has much experience in the field and is happy to offer solutions to your company in needed!