ECommerce currently accounts for only 13.7% of global retail sales, but it already stands at $3.45 trillion in revenue in 2019. In 2040, eCommerce is expected to make up 95% of all retail purchases. With this kind of unprecedented growth, the eCommerce fulfillment industry is racing to keep up.
Third-party fulfillment companies are implementing new technology daily in order to streamline their processes to improve the rate and efficiency of fulfillment. They are also working on speeding up delivery since customers’ expectations for fast delivery and excellent service are ever-growing. This race against time has brought us revolutionary new advances in the world of order fulfillment and gives ecommerce sellers who are outsourcing their warehousing and fulfillment access to state-of-the-art technology and edgy innovation. From improved barcode scanners to drone deliveries, the urge to please has catapulted us into a new era of fast delivery.
eCommerce giant Amazon reported that shipping costs increased drastically from $11.5 billion in 2015 to $21.7 billion in 2017. Companies are clearly putting more money into order fulfillment to up their customer satisfaction and get a bigger piece of the consumer pie. Below are some of the innovations that are top of mind when it comes to revolutionizing the world of order fulfillment.
Telematics, GPS, Bluetooth, and RFID tags
Accurately monitoring the whereabouts of inventory and tracking the progress as items move through the supply chain increases efficiency and points out areas for improvement. Telematics technology has become an integral part of supply chain management and order fulfillment. Telematics is a general term that refers to any device that merges telecommunications and informatics, the process of gathering and processing information. It includes anything from GPS systems to navigation systems. These are often used for GPS fleet management and to allocate resources.
Information about packages and their whereabouts can also be gathered through RFID tags (Radio Frequency Identification) as well as Bluetooth. Order fulfillment is a great example of the Internet of Things at work, where everything is connected and tracked, simplifying supply chain management by advanced software applications that allow increased visibility.
Software for Everything
Gathering information on packages and inventory levels is essential, but managing that information to efficiently analyze and use it to one’s advantage is the ultimate goal. The software itself has also received an overhaul, with Software-as-a-Service replacing on-premise solutions, which restricts access and is limited in the information it can gather.
Order Management Systems are introduced from the start to manage the order and the relationship with the customer, gathering and tracking information from the time the consumer decides on a purchase. Warehouse Management Systems arranges all processes associated with warehousing and distribution. Up to the point where the customer receives their package.
Automation-as-a-Service
Automation-as-a-Service allows warehouses to scale their resources depending on the volume of their business at any given time. It is designed to make RPA (Robotic Process Automation) available and accessible to more organizations. Some warehouses might need additional machinery such as the AI-assisted robot pickers during peak buying seasons, other companies might require additional warehousing space to store inventory and accommodate shopping trends. All these services are made available at a cost per process, and the organization does not have to pay for any services at times when they do not require the additional volume.
Robot Pickers Improve Efficiency
Large warehouses and 3rd party fulfillment centers are increasingly using robot pickers to assist their employees in getting stock off the shelves and ready for delivery even faster. These AI robots determine the quickest and most effective routes through the warehouse, calculating the number of stops, turns and doubling back it will take to pick the most items in the shortest time possible. Companies like 6 River Systems have designed Chuck, a mobile AI robot that actually leads associates to their next task.
Drone deliveries
It will be a while before drone deliveries become commonplace in eCommerce, but companies are paying close attention to innovators and industry disrupters like Amazon to see where new technology will lead us. Especially in dense metropolitan areas, the introduction of drone deliveries for “the last mile” is becoming an increasingly popular and viable idea. Amazon Prime Air is Amazon’s drone delivery service, depending entirely on unmanned drone-flights. The company has patented a beehive-like structure to be built in cities for short-term storage of lightweight packages before they are picked up by drones and delivered to your door. With this service, we will have a lot of other technological advances. Proposed data collection from Amazon delivery drones will include automated object detection, GPS surveillance, gigapixel cameras, and enhanced image resolution.
By using a 3rd party fulfillment warehouse even small-scale eCommerce sellers gain access to these services. Business owners can take advantage of lower shipping rates as the process gets streamlined and collaboration (even between competitors) speeds up distribution.