The main operation in an ecommerce warehouse is order picking

Ecommerce warehouse: the heart of online sales

01 September 2021

An ecommerce warehouse is a facility where orders purchased by customers online are prepared and dispatched. These logistics centers are tasked with shipping a huge number of orders in the shortest time possible, and to do so, they require agile, error-free operations.

Ecommerce logistics constitutes a cornerstone of any company that markets its products online and wants to build customer loyalty while minimizing costs. In this post, we’ll show you why ecommerce warehouses require streamlined operations to face the major challenges of ecommerce. We’ll also explain which solutions can be implemented to optimize the operation and organization of these facilities.

Ecommerce warehouse challenges

The ecommerce sector is booming. The number of transactions and customers that shop online is steadily increasing. According to a study by consulting firm McKinsey, ecommerce sales skyrocketed by 160% between 2014 and 2019 (six to eight times the rate of traditional retail growth). This trend has accelerated with the pandemic: ecommerce rose from 13% to 17% of total retail trade.

The expansion of ecommerce has completely transformed logistics and warehousing. Generally speaking, a traditional storage facility receives the products, stores them, and then prepares the orders, dispatching them based on the available stock. An ecommerce warehouse, on the other hand, calls for different kinds of operations: every day, it prepares numerous orders that often include several items and that are delivered to customers as quickly as possible. Additionally, the sales of these businesses tend to be seasonal, with spikes in demand normally concentrated at specific times of the year, e.g., peak seasons (Christmas, Black Friday) and seasonal sales.

Ecommerce companies usually manage many SKUs. However, not all of them are in stock, so they need to be ordered from suppliers. To receive the products on time and deliver them to customers by the agreed time, there must be smooth communication between the facility and the suppliers. Once the goods have been identified, the warehouse operators organize the products, taking into account the list of orders to prepare. Thus, for example, if there is no immediate demand, the merchandise can be stored. But if a customer has already requested an item, it is directly distributed.

The volume of work in an ecommerce warehouse usually increases around specific dates, such as Christmas and Black Friday
The volume of work in an ecommerce warehouse usually increases around specific dates, such as Christmas and Black Friday

Solutions for an ecommerce warehouse

In an ecommerce warehouse, order fulfillment should be agile. That is, all processes that take place from the time a customer makes a purchase until he/she receives the order have to be carried out as speedily as possible: this includes product storage, order processing, packaging, and the distribution of the orders (in addition to returns management). So, how can you streamline these operations? By means of storage systems that facilitate goods handling and order preparation, and with the help of technology.

Storage systems

In an ecommerce warehouse, it’s important to implement the storage solution — whether automated or manual — that best suits the specific characteristics of the business and that simplifies order prep.

First and foremost, the system chosen should provide direct access to the products — this is vital for order picking. One option is boltless shelving, designed to store small products and easy to assemble and expand with additional modules as per the company’s needs. The only drawback is that, typically, these shelves are no taller than 6.6'.

If you need more height, there are always alternatives, such as building higher racks where operators can use order pickers to access the goods deposited on the higher levels. Another option for leveraging warehouse height — a common theme in countless logistics facilities — is to build mezzanine floor racking systems. You could also install high-bay pallet racking and attach raised aisles to them to facilitate operator travel.

Order pickers enable operators to access goods on the upper levels of the racks
Order pickers enable operators to access goods on the upper levels of the racks

Another alternative for expediting picking is ecommerce automation and the implementation of solutions that foster the goods-to-person picking method. This can be done by installing a miniload system (AS/RS for boxes), whereby operators remain at their pick stations, and a stacker crane, for instance, brings the goods to them autonomously.

Transportation systems

Another strategy employed by businesses looking to speed up fulfillment is to minimize goods transfers and operator movements in the warehouse. One of the most common ways to accomplish this is through conveyor systems for boxes, which independently move the prepared orders to the consolidation area. This equipment is often installed in facilities with mezzanines and in racking with walkways to connect the different levels of the facility automatically.

Conveyors for boxes streamline goods movements in ecommerce warehouses
Conveyors for boxes streamline goods movements in ecommerce warehouses

Warehouse management system

In an ecommerce warehouse, information on inventory should be extremely precise and reliable to facilitate all operations. To do this, an optimal solution is to implement a warehouse management system (WMS), which identifies and organizes the products in the facility according to the characteristics of the items and the list of orders pending preparation.

A WMS is an essential ally for any ecommerce firm, as it simplifies flows in the facility with the aim of dispatching the greatest number of orders without delay. In doing so, it sends clear instructions to operators on how to complete each order (telling them which items they need as well as the aisle and location in which they can find these products).

The WMS controls all the stock and organizes the operations of an ecommerce warehouse
The WMS controls all the stock and organizes the operations of an ecommerce warehouse

Ecommerce warehouse: maximum agility to dispatch orders

The rise and consolidation of ecommerce has spurred a number of changes in warehouse operations. The ecommerce boom has made it clear: customer satisfaction is the top priority. In an ecommerce warehouse, all organization — from the distribution of the goods to the work of the operators — must be centered on supplying customers with the orders they’ve purchased. To that end, it’s necessary to have a WMS that accelerates order picking.

With over 50 years of experience, Interlake Mecalux has been a leading company in the storage and warehouse management system market. Numerous companies, from all sectors, that market their products online count on our solutions to meet their objectives and prepare a larger number of orders per day. Be sure to get in touch. We’d be happy to advise you and help you find the best solution for your ecommerce warehouse.