MANAGING AN E-COMMERCE WAREHOUSE : THE ITALIAN SUCCESS STORY OF IL GIGANTE
Published on 3 November 2017
Loretta Chiantaretto is our Italian Country Manager and has generously taken the time to answer some questions about the current e-commerce market in Italy, and mainly on our particular setup with the e-commerce client Il Gigante.
Can you tell us more about your work with Il Gigante and the current ongoing project?
Il Gigante was already one of our “historical” WMS clients, they actually have a strong trust relationship with Generix, so when they decided to open their e-commerce site they asked us to create a solution for them to manage their e-commerce warehouse. They use their old warehouses to manage store merchandise and opened a new warehouse, a so-called dark store in the technical jargon, to exclusively cater the online shopping merchandise. This dark store is located in Northern Italy, near the Maggiore lake.
The current setup allows Il Gigante customers to order products online through the e-commerce site, at which point the Generix Group solution picks up the order and manages the preparation in the dark store. Il Gigante’s e-commerce model is quite sophisticated compared to the “standard” models of international food&grocery e-commerce, since it allows customers to not only order non-perishable items online, but also fresh products such as cheese, fish, meat and produce: not coming in pre-prepared packages, but directly cut, weighted and prepared on-demand, at the moment. All non-variable weight products are prepared directly in the dark store warehouse, while all variable weight products are prepared in a store located in the warehouse building, at a lower floor. Orders are then delivered currently to 3 retail pick-up locations in Northern Italy and by the end of the year customers will be given the choice for 10 different pick-up spots. Home delivery will also be available in the near future.
Generix Group’s solutions (WMS and TradeXpress) manage the preparation of packaged goods orders at the dark store and at the store while, for variable weight products, the systems receive data from the scales and integrate them. All order items are then consolidated and sent to the requested pick-up locations where the customer then collects the order. The system is really similar to a drive-through!
How is this project different from other e-commerce projects in Italy?
Normally in Italy retailers prepare online orders directly in store, rather than in a warehouse dedicated to e-commerce sales. Having two distinct warehouses will allow Il Gigante to better manage their stock (there will be no consumption of store stocks) and also to aim to have zero stock shortages. While some of the stock (fresh products) is still managed through a store, stock shortages for these products are rare anyway. There are currently just a few other retailers in Italy who are using this innovative set-up.
This has been an ambitious project for Generix Group as we have had to manage all of the existing interfaces: on the one side, the e-commerce site portal, and on the other side, the different interfaces dealing with the preparation of variable weight products and merchandise pick-up. All in all, we were looking at managing 10 different interfaces and 4 systems.
What are the challenges with this project?
For Generix Group, the main challenge was to manage the connection between all of the interfaces and different flows to ensure a smooth transaction from online order to pick-up location. A challenge which was met with the deployment of TradeXpress solution.
Another challenge involved managing e-logistics with the specific Generix WMS set-up, to avoid development during the first phase of the project.
Fundamental for the project execution was the capability of our WMS to analyze order composition - which is greatly heterogeneous in case of this project – to split orders and route their items to different preparation modes (for instance pick&pack or pick-then-pack) and then to recompose orders into single parcels for shipment to the pick-up locations.
This project has been a great way for us to work on an atypical and innovative e-commerce setup, and we are looking forward to seeing how it progresses in the near future!