Amazon transformed shipping and fulfillment best practices during the early aughts, singlehandedly ushering in the e-commerce era and empowering consumers with unprecedentedly accelerated order processing and delivery options. Organizations across numerous industries were essentially forced to fall in step with the Seattle company and implement backend workflows that met renewed customer expectations, according to the Atlanta Business Chronicle.
"What started as a retail phenomenon – buying online – has become a logistics revolution with speed-to-market playing a key role in company success," Chris Barnes, president of the American Production and Inventory Control Society, summarized in an interview with the magazine.
Automation drives these post-Amazon shipping and fulfillment best practices, which, when implemented effectively, can catalyze change and lead to great success – just ask Amazon CEO Jeff Bezos, whose Seattle firm accounted for more than 50 percent of all U.S. e-commerce growth in 2016, according to research from Slice Intelligence published on CNBC. How exactly does shipping and fulfillment automation benefit the operation? Here are five central advantages:
Like Barnes stated above, speed is absolutely critical in today's marketplace. Why? Customers expect to receive their goods in a timely manner. In fact, the average expected wait time for packages subject to free shipping is 4.8 days, according to the management consulting firm AlixPartners. Businesses that fail to meet these expectations can expect to receive prompt feedback. An estimated 79 percent of consumers who do not receive their packages within three days of the projected arrival date reach out to express their displeasure, OSM Worldwide and Parcel found. Those who have too many of these experiences are likely to take their business elsewhere.
Automated shipping and fulfillment processes reduce the likelihood of such customer attrition occurring. Companies that swap manual processes for software-based, self-driven alternatives can maintain fast-moving, scalable supply chains that facilitate accelerated operations and meet the needs of time-conscious consumers.
Customers have even less patience for order errors than they do for sluggish shipping times. In fact, more than one-third are willing to abandon sellers for a single fulfillment mishap, according to research from the software provider Voxware Inc. covered in Supply Chain Quarterly. Approximately 63 percent of consumers say they will take their business elsewhere in the event that two or more order errors occur. Again, organizations have little ground to stand on here. This high risk environment necessitates immense fulfillment reliability of automated workflows can provide.
Instead of relying on siloed, human-driven processes liable to lay the groundwork for fractured operations and less-than-ideal service outcomes, firms that have embraced automated fulfillment manage cohesive backend systems that require little-to-no data entry or alteration. Customers can input their orders and trust that these requests are funneled straight to pickers and packers.
Firms attempting to match industry leaders such as Amazon by scaling up traditional shipping and fulfillment operations often run into budgetary issues. Even those attempting to effectively serve their existing customer bases encounter similar fiscal issues, as patron demands rise, functioning processes become more expensive to maintain and errors mount. In the end, these firms risk folding under the weight of their own red-laden ledgers.
Automated shipping and fulfillment workflows not only promote operational sustainability and reduce errors but also support streamlined backend practices that are easier to maintain and therefore more cost-effective. Organizations that integrate advanced automation hardware and software into their facilities can save as much as 55 percent on order processing activities and reduce labor overhead by as much as 60 percent, according to Gartner. These savings, on top of increased revenue from improved processes, can change the trajectories of entire companies.
In the end, modern businesses operating in the post-Amazon age have no choice but to embrace shipping and fulfillment automation, as the advantages are just too overwhelming to pass up. Enterprises considering making this move should consider connecting with F&A Data Systems. We work with world-class technology partners such as Dell, Microsoft, Oracle and Rockwell Automation to design and deploy customized warehouse management solutions capable of supporting automated shipping and fulfillment processes. Contact us to learn more about how we can transform the warehousing operations at your business.