Order Fufillment Error Rates
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accuracy in order fulfillment December 21, 2011 • Jamie Salvatori No matter how much time, effort, and money you put into promoting your business and converting visitors into buyers, you’ll never create repeat customers if you screw acceptable human error rate up fulfillment. This is partly why I hate out-sourced fulfillment and drop-shipping. Once you acceptable error rate six sigma lose control over this monumental link in the customer lifecycle chain, you’re headed for disaster. So, you MUST become an expert
Acceptable Shipping Error Rate
in fulfillment if you’re going to run a successful e-commerce business. Just think of how silly it would be if brick-and-mortar stores outsourced their in-store workers. Imagine you walk up to the register at
Order Picking Error Rates
BestBuy and the person greeting you is wearing a shirt for “OutsourcedRegisters, Inc”. That’s terrible! And that’s precisely what you’re doing when you outsource your fulfillment operations. You’re leaving your final interaction with the customer -- the thing most memorable in their mind -- up to someone else. Unless you have a very specific reason for outsourcing your fulfillment, don’t do it. Instead, let’s examine how you can do it warehouse picking error rates yourself and enjoy near 100% accuracy in your fulfillment. We’ve done it at my company where our rate of mistake (being defined as sending the wrong item to a customer, omitting an item, or sending too much of an item) is well below 0.1%. A few caveats: We’ve only tested our system up to 2,000 orders in one day. Also, we wrote our own customized software, but I’m sure you could find products out there to achieve similar results. If not, hire someone to write the software for you. It’ll be worth every penny. The program isn’t very complex, so it wouldn’t cost much to have it created for you. We use a batch picking process. This means that we break up all of our available orders into discreet batches of orders. Our software determines how many physical items are required to fulfill the available orders and then breaks them up so that each batch has, at most, 60 items (not orders) per batch. This ensures that our carts aren’t overloaded. We then print out the pick list which details how many of each item is required for this batch. The list is sorted by location so that a worker can walk up and down our warehouse ais
Fulfillment Errors April 26, 2013 • Dale Traxler Ecommerce companies typically focus on acquiring traffic and selling a wide range of products that shoppers
Order Picking Accuracy Kpi
will actually buy. Many ecommerce firms track key performance indicators like new picking accuracy warehouse visitors, conversion rates, and average order values. But for many ecommerce companies, especially smaller ones, fulfillment is acceptable error rate for data entry an afterthought. That is a mistake. There are key fulfillment metrics that all merchants should track, including: Error rates on orders pulled; Error rates on products shipped; Turnaround time http://www.practicalecommerce.com/columns/the-ecommerce-corner-office/10910-How-we-achieved-99-accuracy-in-order-fulfillment for orders from the time of receipt to shipment; Actual cost of shipping versus the rate charged; Time to fill an average order. Frequently there is little or no formal training to fulfillment staff, and the pay is low. As a result, there may be excessive employee turnover. That may lead to even more errors in the http://www.practicalecommerce.com/articles/3999-How-to-Monitor-Prevent-Fulfillment-Errors process. Fulfillment Workflow Most companies follow some version of the following workflow — assuming they print pick lists and do not have barcode scanners. Order is received in the shopping cart or order management system. Order is verified in some manner, such as a fraud check and inventory in stock. Picking slip is printed. A packing slip may be printed at the same time. If you have multiple warehouses, there may be other processes involved as well. Picking slip is placed into some type of container, to retrieve inventory. Container is assigned to an order clerk, who then travels through the warehouse adding the items to the container. Items are checked off as they are picked. Quality check. Once all items are added, they may go to a checking or inspection station for a quality check. Checked orders are then moved to the shipping department. Shipping packs the orders in the appropriate packing materials for the carrier. In some cases, shipping may need to select the carrier based on weight, d
fulfillment errors: Reduced profit from having to resend orders Higher internal costs for processing orders including having to input orders from emails or staff a http://public.four51.com/real-costs-order-fulfillment-errors/ call center Issuing RMA’s Processing returns Losing customer confidence and loyalty (worst http://multichannelmerchant.com/opsandfulfillment/warehouse/whats-cost-fulfillment-error-business-04032015/ of all!) Most companies approach the challenges and costs associated with fulfillment errors solely from the perspective of the warehouse and the pick/pack/ship process after the order has been submitted. But we’d like to offer a different way of thinking about improving this process and reducing errors error rate - the order capture process. How can you reduce, avoid and eliminate order fulfillment errors by providing an easier, more structured, error-proof way of capturing orders? A robust, online, fully-integrated, mobile/tablet-enabled order entry system can dramatically reduce the errors that normally occur during the order entry process and, therefore, reduce the errors with the fulfillment system. Here’s how. Orders captured acceptable error rate via an online system, entered by the end user, avoid many of the problems associated with having the customer service or call center team entering orders sent via email or called in. Also, having to rekey orders into multiple systems can dramatically increase the order error rate. Not having to rekey orders alone have been shown to reduce order error rates from 6% to < 1% at one manufacturing company. Online ordering systems can strictly enforce business rules for users as they are entering orders. For example, the system can force orders to be entered in the proper quantities & packs, ie. single items, dozens, cases, etc. The system can ensure that the customer is presented with the correct information based on their role. For example, they can see the proper pricing, pre-approved shipping methods, and the proper payment method, and nothing else to distract from that. Other typically manual processes can be automated including order approvals, updating the users on order status, and sending order shipping confirmation and tracking information. All of these s
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