Understanding The Impacts of eCommerce On Warehouse Operations

Understanding The Impacts of eCommerce On Warehouse Operations

The rise of eCommerce continuously impacts the warehousing industry today. As customer demands increase, so does the need for storage spaces and distribution centers for order fulfillment duties and operations. Hence, also the increasing demands for warehouses for sale. The impacts of eCommerce on warehouse operations are numerous and for a successful online business it’s important to understand how.

Today’s digital age makes it possible for people all over the world to shop online instead of visiting an actual, physical store. People who have never shopped online before have now discovered the convenience it brings and how it can benefit them from their everyday life. Today, instead of braving through traffic, consumers can now shop online and buy multiple things, converting all shopping trips to a more convenient and home-based mobile device session.

Both the eCommerce and warehousing industry have indeed grown in many aspects over the years. More so, the warehousing sector keeps receiving immense impacts and benefits from the constant development of eCommerce businesses. Still have no idea about the correlation between these two? Listed below are the impacts of eCommerce of warehouse operations today:

 

24/7 Operations

The first one of the impacts of eCommerce on warehouse operations that we should mention is the fact that the market is always open when it comes to eCommerce. And this has urged round-the-clock operations for most warehouses if not all. In addition to the continuous influx of orders, the emergence of next- or same-day deliveries have instantly required warehouses, distribution centers, and other facilities to operate and process orders overnight.

This type of operational pattern has already been applied to larger distribution centers and warehouses a few years back, most of which are located in industrial areas. However, this can be a specific concern for those operating within residential areas as 24/7 operations can disturb the daily life of the neighborhood while also causing congestion and [possible] pollution.

 

Warehouse Automation

With the eCommerce and consumer demands continually growing, more and more warehouses are forced to adapt warehouse technologies and accelerate warehouse automation. Warehouses tap into technology today to help them operate smarter, faster, and more efficiently.

Warehouses who wish to stay ahead of competition now invest in a variety of warehouse
technologies like drones, artificial intelligence, order picking and order fulfillment tools, and
technologies, among the many others.

 

Increased Returns

For many years, consumers were used to shopping at physical retail stores. As technology made its way into the market, it has been determined that most customers who shop at retail stores have completely different behaviors than those who buy online and that those who purchase online tend to change their minds quickly, leaving warehouses with around 22% of returned online purchases.

Consumers are growing more impatient, especially now that they have access and can track their orders. Many customers today expect same- or next-day deliveries, which is becoming a struggle in the eCommerce and warehousing sectors. If anything, the capability of these warehouse spaces to accurately manage orders and returns is critical in the industry. As mentioned, this has left eCommerce and warehousing businesses in constant struggle and challenge as returned goods require not only additional labor and cost but also a considerable amount of valuable storage space.

 

The Shift From Bulk To Individual Orders

For many years, warehouse spaces and distribution centers were made to process bulk orders alone. But because of the growing eCommerce market providing a convenient shopping experience, customer orders can now come individually and in small batches.

However, take into account that in order for you to process smaller and more frequent orders, warehouse staff and managers are responsible for investing in the different warehouse solutions available today. This includes order plotting systems, inventory management, and warehouse mobility.

 

Warehouse Location

In the past years, warehouses were built in accordance with zoning regulations. But today, quick delivery has become one of the most important things to consider when it comes to operating a warehouse or distribution center, and proximity of such facilities to consumers has become more crucial than ever. Hence, the rising demand for warehouse spaces within urban or suburban areas and a lot closer to residential neighborhoods.

Additionally, low shipping fees and free shipping are becoming a trend in eCommerce today. If your warehouse facility or distribution center is located somewhere far out of reach from your customers, this may tack on additional shipping costs, which can discourage consumers from purchasing orders from you again.

 

Unpredictable Purchasing Patterns

Unpredictability has also been a constant challenge for warehouses, especially with the rise of eCommerce today. Due to this, many warehouses find it difficult to keep up with seasonal changes and demands from consumers, often leading to either understocking or overstocking.

More than anything, the unpredictable changes in the market demand should then cause warehouse managers to upgrade the order fulfillment process. This only means that warehouse spaces and distribution centers alike should look for ways to adapt to such changes and stay flexible despite the circumstances. Technology is also as important as these tools can help with the overall order fulfillment process, shipping, tracking of orders on the consumer’s end,
inventory management, and many more.

Pro tip: Avoid the poor forecasting of goods, so you don’t waste or run out of products should any circumstance arise. One of the most effective ways to keep your stock in check in by setting par levels for each item. Only adjust par levels according to a consumer’s buying patterns or seasonal changes. That way, you can lessen or even eliminate the chances of wasting products, errors, damages, and delays.

 

Wrapping Up

eCommerce has only been here for a few years, but it is undoubtedly changing the way warehouses operate today. As customer demands continue to grow and increase over time, warehouse staff and managers should all the more focus on further optimizing processes and adopt new warehouse technologies to boost overall warehouse productivity and efficiency while meeting the needs of eCommerce. In the coming year, there is a predicted 40% increase in the eCommerce market; hence t he impacts of eCommerce on warehouse operations are going to be even greater and the need to really adapt to new shopping patterns and techniques to meet customer expectations is crucial.

 

Author’s Bio:

Angelo Castelda works as a contributor for a news magazine in Asia. On his free days, he likes to read books about the logistics industry and warehouse management. He also gets frequently invited to schools and universities to hold talks about the supply chain system and warehouse operations.

 

  • May 27, 2020