Smart warehousing and distribution tactics help web retailers weather tough periods.
As online retailers prepare for peak holiday periods and whatever storms Mother Nature might send their way, they have multiple ways to fulfill orders and get them delivered, experts say.
In Oceanside, NY, a Long Island community not far from a barrier beach overrun by flood waters last month during Hurricane Sandy, web-only footwear retailer WideWidths.com’s local operations are not completely back to normal. A recording today on its toll-free customer service line informed customers that the retailer is working to get its office operations up to speed while continuing to take and process online orders.
Although Oceanside and the rest of the New York and New Jersey coastal areas were ravaged by the storm, WideWidths.com has been able to continue fulfilling many of its orders though distribution centers located far from last week’s storm surges. “Our warehouse in upstate New York was not affected and we are processing orders and sending them out in a timely fashion, but there may be slight delays with replying to e-mails,” the retailer says in a note posted on its web site.
WideWidths.com, which could not be reached for direct comment, sends its online orders to Webgistix, a fulfillment services provider that handles delivery for the e-retailer. Webgistix operates five distribution centers across the United States, and can route orders to the most suitable center for expediting deliveries to a retailer’s customers, says Joe DiSorbo, CEO of Webgistix.
As Hurricane Sandy kicked up the wind and waters off the coast of New York, a shipment of shoes from WideWidths.com’s suppliers sat in a cargo facility at the Port of New York and New Jersey. Webgistix was able to pick up the shipment and transfer it to its distribution facilities near Rochester in upstate New York to escape the worst of Sandy and keep on fulfilling orders, DiSorbo says.
In addition to two facilities near Rochester, Webgistix operates distribution facilities in Atlanta, Las Vegas and Reno, NV. The company also fulfills orders for retailers’ overseas customers, and it recently opened distribution facilities in the United Kingdom and Switzerland.
Webgistix charges retailers about $500 in set-up fees, plus monthly storage and related fees that average about $300. It also charges pick-and-pack fees that can run between $1 and $4 per package. The company generally serves retailers ranging in annual sales from $5 million to $100 million.
While maintaining distribution centers in various locations can help web retailers to continue shopping through adverse weather, it can also help to keep things flowing during peak shopping periods, for example, by shipping from a distribution center closest to the consumer, DiSorbo and others say. Webgistix is also able to use its network of distribution facilities to scale up as necessary to meet peak demand, says Zachary Ciperski, vice president of CoffeeForLess, a Philadelphia-based retailer that ships to West Coast customers through Webgistix' Reno facility. "They understand our seasonality patterns," Ciperski says. "They hire seasonal staff and extend fulfillment team hours to ensure, even with increased order velocity, all orders go out the door within 24 business hours."
There are also several steps that retailers that manage their own fulfillment centers can take to ensure the fast flow of orders, says Ian Hobkirk, founder and managing director of Commonwealth Supply Chain Advisors, a firm that provides distribution consulting services to retailer and manufacturers.
Hobkirk advises retailers to develop a “forward pick” area in warehouses to provide for faster fulfillment of the typically small shipments that go to consumers. Because shipments to consumers often contain only one or two items among a retailer’s wide assortment of products, a forward pick area typically stores only the most popular SKUs. This allows a warehouse worker to pick several frequently ordered items quickly within a limited space near the packing area, rather than having to travel further throughout a warehouse to pick the items for each order, Hobkirk says in a recent report, “e-Commerce in the Distribution Center: Making a Graceful Transition.”