Buying patterns are constantly changing, with the current trend being customers placing more orders, but with smaller quantities and value. A decline in average order value shouldn't mean a downturn in profits. The best way to combat this is to reduce labour costs, and improve the order picking process.
Pick, Pack & Despatch - Filplastic's Top 5 Tips
1) Don't mix multiple SKUs (Stock Keeping Units) in the same location. If a shelf level contains 5-10 mixed SKUs, this means that the user has to search through to find the one they need. This wastes valuable picking time. Separating each SKU into it's own compartment also improves accuracy and aids stock replenishment.
2) It sounds simple, but aim to reduce travel time. Design a "Hot Spot" area where all the fastest moving lines are housed. It's often the case that 20-30% of your stock accounts for 80% of your orders, so it makes sense to have them all in one place. Split your stock into 3 sections, A, B & C, with "A" being the fastest moving, and C being the slowest. For the "A" section locate all your fastest moving stock here at ground level, and ensure that there are wide aisles to ease congestion.
3) Wherever possible, always pick horizontally rather than vertically. It's much faster to pick from ground level, rather than having to climb stairs. This of course, isn't always possible with space at a premium, but use multiple pick locations lower down with the replacement stock and slower moving lines up above.
4) Use the correct equipment! This may sound like a selling job from us, but it is a very important part of the process, and any outlay on equipment will soon be made back several times over if implemented correctly. Analyse each SKU in terms of the item size and turnover, and decide on the correct method of storage. This could be in wire baskets, plastic bins, drawer units, pallet racking, shelving or pigeon hole units. Storing things correctly reduces picking time, as there is no scrabbling about in cardboard boxes, as the stock is already out and ready to pick.
5) Never have an empty pick location! One of the biggest wastes on resource is when users go to a pick location, only to find it empty. Keeping the stock in cardboard boxes, or above eye level can be a big contributor to this. Have the stock split out into baskets, with full cartons of stock stored above.