When we talk about optimising pick and pack, we’re really looking at overcoming challenges to efficient pick and pack processes. Those challenges are:
- Inaccurate or Inadequate Inventory
These are two slightly different problems. Inaccurate inventory leads to confusion about what is available, whilst inadequate inventory is a failure to manage stocks into the warehouse space to allow for order fulfilment. The first is usually a problem of data entry, where stock records haven’t been updated or entered correctly, the second is a management failure which can be the result of poor data but can also be part of cashflow issues or failure to prioritise properly. Either can lead to poor pick and pack, poor customer service and reputation loss.
Essential product information usually includes: pick and pack process 
- SKU (stock-keeping unit) plus product description (this is vital if your system allows for alternate items to be picked when first choice stock runs out)
- Dimensions and weight of product
- Product information for hazardous, temperature controlled and fragile items
And valuable information may be:
- SKUs grouped by category (ie all items in the same class)
- Items frequently ordered together
- Averages of lines and units per order (useful for choosing your pick and pack system)
- Poor Turn Around Time
Turn around time (TAT) is the time taken to process, pick, consolidate and pack an order. It’s usually outside the scope of a warehousing operation to improve inward order processing times, but picking, consolidating (putting together) and packing can all be optimised. Issues here include poor product placement, inadequate picking systems (see our article on Pick and Pack Evolution for help with this issue) and/or a poorly organised warehouse operation (eg warehouse personnel being taken off pick to pack, stock not being unpacked on shelves so operatives have to unpackage items to pick them, badly planned work days so staff aren’t around for peak periods etc).
- Packing failures
Pick and pack is treated as one process, but it’s two distinct operations. While no pick system can be 100% successful, no matter how successful the pick system, packing failures can make the whole process pointless. Problems here include:
- Inadequate information about packing: weight, fragility, temperature or humidity control, spoilage dates etc that leads to products damaged in transit.
- Poor understanding of the processes and requirements of your logistics providers: customs clearance documents, labelling protocols, etc, which can cause orders to be mis-delivered or pulled out of delivery completely.
- Failure to recognise the implications of DIM weight. Dimensional weight, also known as volumetric weight is a process used by logistics providers to ensure they don’t lose margin on transporting light but large items. Essentially they measure two factors; physical weight and dimensional size, which can lead to extra shipping costs.
Optimising pick and pack for every warehouse
Warehousing space comes in many shapes and sizes, and warehouse rental is popular and cost-effective, which makes it difficult to offer a clear diagnosis. However, there are some optimisation strategies that work for any warehouse operation.
Warehouse Layout
There is no doubt that the biggest area of improvement for any pick and pack operation is warehouse optimisation. Every time and motion study reveals that there’s a direct link between efficient layout and quicker TAT. One of the easiest ways to manage this is to conduct an ABC Analysis. ‘A’ items are managed with tight control and accurate records because they have high order rates over a set period (quarter or annual). ‘B’ items are less tightly controlled but have good record-keeping and ‘C’ items are managed with the lightest controls and minimal records because they contribute very little to the warehouse operation. ‘A’ items should be strategically located in the most accessible locations, placed using ‘often ordered together’ data and closest to the packing stations as they will bring the most profit, most often. ‘B’ items are further away and ‘C’ items are in the least optimal locations for picking and furthest from packing.
Reducing picker times
The oft-cited fact that pickers can spend up to 70% of work time moving around the warehouse space makes clear that reducing travel time is vital to optimising warehouse efficiency. Warehouse slotting reorganises inventory to put the most ordered items closest to each other and to the pack point so pickers move less distance. Multiple aisle slotting – having the same item in several different locations – means that many pickers can be selecting the same items from a range of aisle without causing congestion. Other ways to improve picker times include regularly changing the SKU locations so that promoted items (BOGOF or similar) and seasonally popular choices are placed close to pickers. Pareto’s Principle – that states that roughly 80% of outcomes arise from 20% of causes – states that for optimal pick and pack, you want to have the bulk of most picked items close to your pack station, with around 20% being right at the back of your warehousing, because they are so rarely picked that they aren’t worth factoring into travel time.
Optimising your pack technology
It’s surprising, but many e-commerce fulfilment operations fall down on one of the basics of technology – packing. For example, and depending on the size of your operation and number of locations, items like box erectors and tape machines can reduce labour costs considerably and speed up the pack part of a pick and pack operation too. Of course there’s an upfront cost to technology that has to be factored into pick and pack optimisation but these basic forms of pack tech can save their start up costs within a year, as well as reducing reliance on skilled personnel which is currently such a challenge to warehouse operators.
Dunnage (filling material) is another place where pick and pack optimisation can be implemented. There’s a vast range: crumpled paper, air pillows, bubble wrap, packing peanuts, expanded polystyrene etc. Optimising dunnage requires two processes:
a – having the right dunnage for the job at hand
b – training pack teams to know which dunnage to use, so they don’t hesitate over which packaging to use for which item.
Again, this has an upfront cost, in training time as well as investing in a range of supplies, but being able to pack rapidly (and cost-effectively) can reduce the long-term cost of pick and pack operations by up to 15%.
Consider scaleable infrastructure
Perhaps the most effective way to optimise pick and pack is to hand over order fulfilment to a 3PL provider – then they have responsibility for your seasonal surges, your fluctuating order volumes and managing efficiency! Flexible warehousing such as shared or rental warehouse space, is often employed alongside 3PL outsourcing as the most efficient way to cope with variable demand without affecting your profit margin.