Why a WMS is the first step to efficient micro-fulfilment

Why a WMS is the first step to efficient micro-fulfilment

24 February 2021

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Shop local is a message that has really taken off in recent years and has been massively fuelled as a result of Covid. In a recent survey, YouGov found that as a result of the pandemic, 64% of people want to support local businesses and buy local products, with women being even more likely to shop within their community (70%). Buying locally helps to support local traders, their suppliers and the people they depend on to run their businesses, as well as enabling you to lower your carbon footprint. Shopping locally also boosts the local economy, rebuilding confidence in the community, enabling local businesses to prosper and grow. Stats show that for every £1 spent with a local, independent business, between 50p-70p circulates back into that local economy.

Increasingly local businesses are also seeking to provide e-commerce services from within the store and as a result, store owners are investing in micro-fulfilment centres to streamline order assembly and shipment processes. In some cases, local businesses are also offering a click and collect option to further help with social distancing and safety.

Ask any online retailing company and they will tell you that picking, packing and shipping e-commerce orders is costly without technology in place to limit the manpower required. By adopting automated micro-fulfilment systems or introducing warehouse management system (WMS) technology in the back of store area, retailers can rein in costs and still maintain high levels of efficiency.

Taking a long range view is important. Analysts expect that consumers who have now become accustomed to online shopping will continue to enjoy the convenience it delivers. Experts are suggesting that among the people that have switched to e-grocery shopping, a good half will continue and won’t be returning to the store as before.  Even the most reluctant online shoppers are converted and this means finding more efficient ways to fulfil orders is essential.

Using a best-of-breed WMS within a micro-fulfilment centre to fulfil e-commerce orders offers the benefit of significantly reducing costs for a lower entry cost. The implementation costs are significantly lower, fewer operatives are required and greater throughput can be achieved. A WMS also improves stock visibility to avoid disappointing customers with substituted items. Why would you want a bunch of bananas when you ordered blueberries?

Most importantly, using a WMS also allows the retailer to see a single, consistent view of the customer, which is essential for building brand loyalty. Brand loyalty is even more important to develop in today’s retailing environment. The current cost-conscious consumer is more likely to consider alternative retailers and shop around than ever before. This is reflected in additional brand research by McKinsey, which found that more than 75% of consumers tried new brands, places to shop, or methods of shopping during the coronavirus pandemic.

A WMS will allow retailers and micro-fulfilment partners to transform their operations and ensure that orders are picked on time in full (OTIF) – all day every day. Using a WMS, picks are optimised by assigning efficient pick routes and using the WMS to implement dynamic slotting. This means storage space (which is often very tight in a micro-fulfilment centre) is used as effectively as possible to hold inventory.

A WMS will also enable you to calculate the total time needed to complete an order fulfilment cycle for maximum profitability. By tracking individual picker accuracy, you can create a benchmark for continuous performance improvements.

Data analytics from the WMS will enable picking processes to be finetuned and potential problems that lead to delays in picking online orders to be investigated.

There are many benefits of using a WMS in a micro-fulfilment e-commerce environment. It will help to improve stock visibility, pick route optimisation, space utilisation with dynamic slotting and, where relevant, returns management. It will also ensure better inventory accuracy, the creation of safe, socially distanced picking zones for workers and provide a much better all-round customer experience.


Eric Carter

Solutions Architect Indigo Software