In the current economic climate, a lean ecommerce packing operation is essential in maintaining a competitive edge.
Keeping costs down, while improving efficiency are key for delivering year-round, but they become especially important during seasonal demand…
The ecommerce packaging materials and processes you use in your packing function can often be key to helping you maintain a lean operation, even in the face of some of challenges like temporary labour requirements and the fight for warehouse space…
What are the biggest challenges of peak seasonal demand?
After peak 2021, we surveyed retailers and their 3PL partners to see what their biggest challenges were during their busiest seasons. Here’s what they said:
- 42% said pack times increased – with 30% reporting this was by a minute or more
- 40% said they needed temporary labour – to cope with the increased strain on their packing operation
- Almost 20% reported their packaging materials could be easier to use – emphasising the need for easy to assemble packaging during high demand
- 1 in 5 reported space was a challenge – they didn’t have enough room for their product AND all the ecommerce packaging they needed
These findings highlight the pressure that seasonal spikes in demand can put on ecommerce businesses, retailers and 3PLs…
So, if peak demand could push your operational capacity to its limit, here are 5 things to consider when planning for the busy season ahead:
1. Improve your inventory organisation
One of the best ways to prepare your ecommerce packing operation for peak is to make the most of the space you have. You should ensure that your packaging and product inventory is well organised and easy to navigate.
If floor space is at a premium, you can make use of height. You can adjust racking or pick face height to accommodate your stock range and utilise floor to ceiling space. For example, by adding a stackable pick bin or container to a single shelf, you can double your shelf space in minutes.
Place fast moving stock in prominent, easy access pick locations, this will reduce pick times. Stock which is called off less frequently can be placed further away or in a higher location. Introducing pick trollies will allow your team to complete multiple small item orders more quickly.
Organising stock locations does not require an expensive infrastructural change or operational downtime. It can be completed in a matter of hours with a range of relatively inexpensive lightweight, flexible pick systems. Easy to assemble and strong enough to hold up to 500kg, they can be erected quickly. Interchangeable shelf dividers allow you to maximise storage to match your product range. Angled shelfs can also ensure that those slippery items don’t end up on the floor!
You can apply this method to organising your packaging materials too, making sure key SKUs are located close to packing benches, and a water-spider system is in place to replenish benches using a trolly.
2. Take frequent stock checks and make use of forecasting
Another way to make sure your packing operation is lean during seasonal demand is keeping on top of stock checks and forecasting.
Regular stock checks can help you to assess if you are getting the optimum value on warehousing costs. It can also reduce incidents of over ordering stock, aged stock, and product write-off.
Regular forecasting sessions will help you to monitor call-off rates, ordering patterns and continuity of supply. This is particularly important when it comes to making sure you have enough packaging to ship your products. Forecasts can help you control the amount of packaging you want delivered and when, minimising the impact on your warehouse space, while making sure you do not run out of packing materials at a critical time.
You should only be storing stock on site that generates revenue, if it is not making money, why are you paying to store it?
3. Identify opportunities to free up cashflow
Cashflow is the lifeblood of any business, so do not spot or bulk buy stock that won’t be used for months. Buy little and often, but make sure you get it right to maintain continuity of supply.
The packaging you use to deliver product to customers doesn’t generate revenue, so are you purchasing it wisely or, is your warehouse full of slow-moving stock?
If you are buying in bulk from a manufacturer to save on packaging costs, you may be paying more to store it on site for long periods of time. This can cancel out any initial saving. Slow-moving stock also has a damaging effect on cashflow, as materials are bought and paid for before they’re required.
Consider purchasing from a packaging distributor on a stock and drip or Just-in-Time basis, this enables you take delivery as required and only pay for stock as you use it.
This gives you an opportunity to rethink you warehouse floorspace too, maximising your cash generating stock or creating space to expand your operation.
4. Find ways to speed up packing times
Pick and pack times can have the biggest impact on order fulfilment in your ecommerce operation. You’ve considered improvements in your inventory, now it’s time to look at the packing process.
Rigorous induction training for new starters and temporary workers will give packers the best start. Training will allow staff to learn techniques that reduce the time to pack and minimise material use. Training also ensures your team are using the best packaging materials for the job.
Remember, badly packaged orders will be susceptible to damage in transit, this will generate increased workload for customer services, the warehouse and transport as they backtrack on replacement orders.
For fragile products or odd shaped pallet profiles, consider crib sheets and posters to maintain best practice. Implementing packaging size guides and shadow boards on packing benches is another good way to control this!
The style of packaging, or packaging automation, you use can also dramatically reduce packing times. For example, crash-lock base boxes will be quicker to erect than a standard 0201 box.
If you’re using packing tape, a pre-programmed tape dispenser will provide packers with the right length of tape ready to apply. Alternatively, if you’re palletising products, a stretch wrap machine can manage pallet wrapping whilst operatives are free to pick the next load.
5. Maximise your delivery vehicle space
Last, but not least, you can keep your ecommerce operation lean by effectively managing transport costs…
By rethinking your packaging and optimising your pack cubage, you will be able to fit more goods onto a delivery vehicle. This increases vehicle payload and reduces the number of trucks required for deliveries – making your logistics operation more efficient, reducing cost and carbon footprint.
This also applied to couriers. Decreasing or optimising the dimensional weight of your parcels will enable you to control courier and postage costs and avoid penalties if your packs don’t comply with any guidelines!
Support delivering a lean ecommerce packing operation during peak
At Macfarlane Packaging we work with customers to help improve supply chain efficiency, reduce costs, and support you in achieving your sustainability goals. Why not contact us today to find out how we can support your business?