The Omni-Channel Distribution Challenge

WERCShhet 16

Steve Johnson, Managing Principal of Johnson Stephens Consulting, provides insight about the omni-channel distribution challenges of 2016. 

Excerpts from the full article as published in the January - February 2016 WERCSheet...

"Retailers are entering the year in a mixed economy, with e-commerce sales growing at a double digit pace, more customers making purchases via mobile devices, and store sales running at lower single-digit growth rates."

"Subscription-based online programs are popular. The large millennial generation is proving this: they shop online, and only go to the store if they can find what they want and in their size. There is pressure on retailers to focus on much better distribution center and store inventory visibility through the web for millennials to find store-based retail relevant."

"We have seen an increased demand for the proper siting, planning, design and implementation of new e-commerce fulfillment centers to provide the in-stock position and best service levels to the customer."  

"Proper assessment and selection of MHE technologies, such as goods-to-person, high speed unit sortation, pick modules with zone divert conveyor systems, productive picking and order consolidation tools (light- or voice-directed or sight-directed work, etc.) ensures that service levels are attained while also achieving high after-tax return on investment (ROI) results."

"Labor management systems (LMS) implementations are documenting productivity improvement and reduced labor costs of between 12 percent and 25 percent. With real-time feedback to associates, and through the use of “near real time” staffing of work areas that result from the LMS, the results have been shown to increase the savings beyond 25 percent—up to 40-plus percent savings. This has reduced labor hiring requirements in some overly competitive labor markets."


WERC members can see more of this article at WERC