WMS: The Key to Success in the Era of Multichannel Distribution

The Challenges of Multi-Channel Fulfillment

Multichannel operations face challenges different from the ones online retailers have to deal with. For instance: A small- or medium-sized eCommerce business with a limited set of SKUs can efficiently manage activities in the warehouse with the use of spreadsheets and its ERP system’s warehousing capabilities. Multichannel operations, on the other hand, don’t have that luxury. Even with a limited set of SKUs, a company that distributes its products across two or three sales channels cannot hope to unlock the efficiencies it requires to compete with paper-based workflows.

Let’s take a look at some of the warehousing management challenges that specifically threaten multichannel operations.

Complex Order Fulfillment Processes

With many sales channels come a variety of order types. Orders destined for brick-and-mortar stores, regional distribution centers, 3PL facilities, and individual consumers greatly differ in number of order lines, item quantities, ordering schedule (D2C orders can come in at any time), packaging & shipping requirements, etc.

The efficient fulfillment of different order types calls for different fulfillment strategies. Picking methods and material handling equipment will differ whether the order comes from a corporate client or is destined for a single household. An operator must have the ability to adapt their processes to their sales channels. In multichannel operations, order fulfillment efficiency hinges on a company’s capacity to:

• Maintain accurate visibility on inventory in real-time
• Design and implement adapted workflows
• Dynamically assign tasks to workers (e.g.: modify assignments as new D2C orders come in, task interleaving, etc.)
• Closely monitor activities and the movement of goods in the distribution center
• Consistently enforce fulfillment rules across all channels.

Naturally, spreadsheets won’t cut it.

Manage Customer Requirements and Expectations with a WMS

Selling across many channels means having to comply with a larger variety of customer requirements. Different corporate clients can have different labeling, packaging, and shipping requirements. Meanwhile, some individual customers may want expedited shipping while others are willing to wait the extra day or two.

Consider, also, compliance with FDA and/or varying State regulations across a large distribution network (e.g.: labeling requirements for alcoholic beverages). To consistently comply with all those requirements and avoid costly returns, companies have to implement rigorous inventory management processes. This, however, exceeds the capabilities of even the better ERP systems out there.

Meanwhile, companies must also adapt to their customers’ expectations. Today, most consumers—both corporate and private—expect inventory status to be visible online and to receive back-in-stock alerts, all of it in real-time. Short of an integrated software architecture that relies on inventory data updated in real-time, companies will be unable to meet such expectations and risk losing customers.

Leverage a WMS to Master Reverse Logistics

It’s one thing to manage distribution across many sales channels at once, another to efficiently manage reverse logistics across all of them. Failure to do so can lead to inventory shrinkage, encumbered aisles & docks, and other operational penalties that will quickly eat at a company’s margins.

To avoid the operational penalties that come with inadequate return processes, companies must be able to:

• Track all items at every location
• Direct employees as to the proper handling of returned items (from the docks to putaway)
• Immediately adjust inventory levels

WMS: The Key to Omnichannel Efficacy

The aforementioned operational challenges are just a sample of the obstacles that lie in the way to true omnichannel efficacy. Nevertheless, they make it amply clear that manual processes, spreadsheets, and a basic software architecture won’t be enough to run a successful multichannel operation.

Many systems and applications are required to achieve omnichannel efficacy (ERP, LMS, TMS, eCommerce/PoS platform, etc., to which manufacturers will want to add an MES and an MRP). However, none may be as crucial as a WMS. Simply put: short of the right WMS solution at its heart, no software architecture can unlock the efficiencies required to overcome the challenges mentioned above.

Only with the right WMS can companies:

• Maintain accurate and detailed visibility on inventory in real-time
• Design and implement channel-adapted workflows across the distribution center
• Optimize task assignments and efficiently guide workers on the warehouse floor
• Define and consistently enforce rules for customer requirement compliance and well-organized reverse logistics

Through proper integration, a WMS enables a company to rely on accurate data across all systems. This empowers multichannel operations to implement inventory management best practices (e.g.: Available-to-Promise strategies), greatly improve their back-office processes, stay ahead of the demand signal, and satisfy their customers’ expectations by relaying relevant inventory information in real-time.

Learn more about SOLOCHAIN WMS

To learn more about what the SOLOCHAIN WMS/MES can do for your multichannel operation, visit the Generix Group SOLOCHAIN WMS page, or download the SOLOCHAIN WMS Product Sheet.