Prepare your warehouse for multichannel sales and enhance your customer's experience.

31 October 2021

There is no doubt that consumer habits are changing. With the digital era, the way of purchasing has been completely reconfigured. Today’s customer does not buy from just one channel. They examine several before completing a purchase, meaning they are omnichannel (multichannel). A company that only has physical stores misses sales opportunities, as do those that sell only through e-commerce.

This is demonstrated by a study by Accenture, a multinational management consulting firm, which found that consumers with access to multiple purchasing channels spend about 37% more than those with single-channel companies. These consumers keep an eye on the shopping experience offered, evaluating other customers’ comments before finalizing an order.

These numbers show that it’s not enough to simply create another sales channel without preparing the company to offer the best shopping experience to the consumer. The multichannel retail represents a competitive and ever-evolving landscape. Therefore, changes in consumption patterns bring with them the need for changes within companies. It’s useless to maintain a traditional model to serve a modern customer, embedded in the digital context.

In this scenario, manual intralogistics operations are lagging. Besides having slow processes, with the migration to omnichannel, traditional warehouses may face difficulties and see costs increase, as it is an operation that will start managing both large orders (in boxes, pallets) and fractional orders (separate items).

Some believe that hiring more employees or increasing storage space will eliminate problems, but this is a false belief. There’s no point in having more workforce if tasks are not well distributed or if employees do not have the ideal tools to perform their activities without errors.

It will also not help to expand the stock if products are not positioned in strategic addresses aimed at reducing movements, non-competition of equipment, and speed in picking. Therefore, the most important thing is to have well-structured processes that coexist without internal friction and without impacting the final recipient.

And your company, is it ready for this change?

Here’s what you should consider.

Multichannel Logistics

In general terms, we can say that omnichannel order fulfillment comprises six fundamental processes:

▪ Communication: circulation of product information through online/offline channels

▪ Order processing: order receipt, order confirmation

▪ Warehouse management: merchandise availability, inventory control

▪ Shipping: packing and transporting products

▪ Last mile delivery: bringing the product to the final customer

▪ After-sales: customer service

To meet all these requirements, it is important to have precise and real-time visibility of inventory across all channels, as well as efficient processes so that the warehouse can sort and ship different types of orders simultaneously. Another requirement is to have a team prepared and focused on meeting each request well.

Discover the main challenges for multichannel business logistics and ways to overcome them in the following topics.

Challenges for the Multichannel Warehouse

One of the biggest challenges for a multichannel warehouse is inventory management: how and where to store products? In the warehouse? In stores? What is the correct stock level for each location? Evaluating these points is important so that the company never runs out of stock when the consumer is closing the purchase, either in the physical store or on the website. The item must be available in the right place at the right time.

It is also important to be prepared to handle constant returns, in addition, of course, to ensuring agility and assertiveness in deliveries when the customer wants to receive the product at home.

It is worth adding that in multichannel operations, the warehouse will handle different types of shipments: small online orders from consumers and large replenishment orders from stores, for example. This can be a problem for the manager if they do not have the right strategy to avoid errors and reduce picking times for each type of order. Picking errors lead to losses in several orders and delays affect not only operational costs but also customer satisfaction.

To tackle all these challenges, an important decision is to invest in technology to optimize processes, eliminate errors, and centralize information. The WMS, warehouse management system, can help you manage both storage rules and process execution.

In other words, it is important to have specialized software to keep all areas of your operation running smoothly. WMS allows all your systems and technologies to communicate to create an organized and efficient workflow.

For warehouses migrating to multichannel, it is important to keep the following points in mind:

Demand is Increasing

Consumer expectations increase every day. Driven by benefits that have become standard, such as free shipping or one or two-day deliveries, customers have little patience for slow deliveries and even less for errors.

Since direct-to-consumer shipping involves picking individual (fractional) items instead of pallets, the possibility of error is greater. Additionally, if the warehouse is disorganized, operators are likely to take longer to pick an order. This means increased costs, loss of productivity, and a possible impact on customer satisfaction.

In these cases, the solution lies in having a WMS system, which will manage the addresses of each product and order information, ensuring that employees have access to the correct data during picking, packing, and shipping.

The WMS has a significant impact on the picking process, especially when the company uses the ideal picking model for its business. By using the most appropriate format, it is possible not only to speed up the process and reduce errors but also to reduce costs with the correct use of DC resources (people, equipment, and area).

It is worth adding that by reducing errors in the operation, the WMS also helps reduce reverse logistics cases, as many returns are due to process errors. As a result, warehouse staff can focus on more profitable activities.

Visibility is Key in Multichannel Logistics

The role of the warehouse in multichannel service is not limited to separation, packing, and shipping. Your team is also responsible for providing a better shopping experience in-store and online. Consumers want to have information about available stocks during their purchases. Providing greater visibility of product availability is no longer a bonus but a necessity.

Therefore, your company’s systems must collaborate to keep up with demands and provide accurate information across all channels: your website or application must provide visibility into warehouse stocks anytime and anywhere.

By adopting technology that integrates your warehouse data with ERP, e-commerce, and point-of-sale systems, you can provide accurate information about product availability in stock. Additionally, the WMS must generate transport orders capable of integrating with carrier systems, providing correct information and ensuring traceability. All this contributes to creating a seamless customer experience, regardless of the channel.

When it comes to visibility, we can also add the importance of tracking all transaction data in real time to ensure orders are fulfilled on time and without errors. With the Vista Management WMS solution, this is possible. Through this functionality, the manager and their team have panels and dashboards that inform the status of each process, as well as the productivity of each operator.

Through Visual Management, it is possible to quickly identify failures and correct them before they even occur. With this, the company can maintain its customer service standard.

Turning Challenges into Opportunities

As multichannel service becomes a pillar of warehouse operations, challenges arise from all directions. The ever-evolving demands mean that stability will not come soon, so the key is to turn obstacles into opportunities to improve performance and thrive. Companies will succeed in multichannel service if they recognize the role of the warehouse in digital transformation and invest in streamlined operations.