The pressures of next-day fulfillment, set by ecommerce giants like Amazon, have begun pressuring the efficiency of warehousing and have promoted many innovations along the supply chain. Next day shipping used to be considered a competitive edge, but has recently become the baseline of customer expectation. For companies that do not have the manufacturing and warehousing power of companies like Amazon, this has become a difficult standard to maintain.
Many companies have begun developing creative and strategic warehouse solutions in order to compete. Previously a company may have one, possibly two, warehouses in the country, keeping all their products in one place and then shipping it from that location to the retailers. This method can often take 3 to 8 day depending on the distance the distribution center is from the retailer. With current customer expectations being next day delivery, this mode of transportation causes a devalued experience for the customer.
A method that many companies have adopted is the use of a chain of small warehouses (nodes) scattered amongst densely populated areas, having the products distributed to those warehouses instead of having one large one. This method allows for the nodes to be closer to city centers, which often promotes the opportunity to offer free shipping, which is a major competitive advantage.
Adoption of inventory management and advanced warehouse management software has also helped streamline the warehouse process so that companies can compete. Advanced inventory management software can track the products using FRID chips from the node to the customers address. The software also keeps notes of how much available inventory there is at each node, creating a supply chain that is cohesive, adaptive, and responsive.
To learn more about the Chicago warehouse services available at G&T Enterprises, contact us today.
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