Your eCommerce store is thriving, but fulfilling orders is consuming time you could be reinvesting in your business. If this sounds like you, it’s time to explore how the right warehousing and fulfilment strategy can help you scale.
The eCommerce logistics side can be overlooked in the excitement of building an online brand. However, choosing the right approach—whether it’s a traditional warehouse or partnering with a dedicated fulfilment center—is crucial for meeting customer expectations and driving further growth.
In this blog post, we’ll unpack everything about warehouses and fulfilment centers, covering their functions of warehouses, types, and how they impact your bottom line.
What are Warehouse and Fulfilment Centres?
Warehouse and fulfilment centers are hubs designed to store inventory and facilitate the rapid movement of your merchandise.
Warehouses provide secure, long-term housing for bulk quantities of goods, seasonal products, or less time-sensitive items. They typically prioritise cost-effective storage and less frequent shipment of large orders. Warehouse fulfilment centers’ primary goal is to process customer orders efficiently, quickly getting products from the shelf to the customer’s doorstep. Fulfilment centre teams pick, pack, and ship orders daily (sometimes hourly).
Types of Warehouses: Understanding Your Options
Bonded Warehouses
Ideal for businesses that import goods internationally. Bonded warehouses are secure facilities that let you store products before they clear customs. This flexibility can help manage cash flow by potentially delaying duties or taxes and speeding up the import process for smoother logistics.
Private Warehouses
If control is key, a private warehouse offers just that. You own or lease the facility, managing everything from staff to security. This translates into the freedom to customise operations to your exact specifications. However, prepare for substantial costs upfront (building or purchasing) and the ongoing responsibility of upkeep and staffing.
Cold Storage Warehouses
Cold storage is the solution if you have products that need to stay fresh. These warehouses maintain specific temperature ranges to protect perishable goods like food, pharmaceuticals, and even delicate items like flowers. The downside is increased operating costs due to specialised energy needs and infrastructure requirements.
Cooperative Warehouses
Cooperative warehouses are shared by multiple businesses, reducing the cost burden for everyone involved. These types of warehouses are especially smart for smaller eCommerce stores or those with fluctuating inventory needs. Just remember, you’ll lose some direct control over processes since you’re coordinating with other facility users.
Smart Warehouses
The future of warehousing is here. Smart warehouses leverage advanced technologies like robotics, AI, and automation to transform operations. Imagine robots zooming around to pick orders and software that optimises your space usage. This can lead to lightning-fast picking/packing, reduced errors, and greater efficiency.
How Warehousing & Fulfilment Centres Work
Receiving
The arrival of new shipments marks the beginning of the warehouse journey. Goods arrive at the facility via truck or shipping container. The incoming items are checked against purchase orders to ensure the shipment is complete and accurate. Then, inventory is carefully inspected for any damage or quantity discrepancies. Each item is labeled and entered into the warehouse’s inventory management system, allowing for easy tracking of its location and stock levels.
Storage
Organisation is key in warehousing, that’s why inventory needs a designated home within the facility. Items are placed in specific locations like racks, shelves, or bins, chosen based on product size and type. The goal is to maximise space within the warehouse while keeping items easily accessible for order picking. Different storage methods are used like pallet racking is ideal for large, bulky items, and shelving provides neat storage for smaller products or individual units. And bulk storage for high quantities of loose items.
Inventory Management
Modern warehouses rely on specialised software called Warehouse Management Systems (WMS) to track inventory. These systems are essential for monitoring stock levels in real-time, so you always know what’s on hand and track the exact location of items within the warehouse.
It ensures proper stock rotation (First-In, First-Out) to prevent expired or outdated products. Setting reorder points to automatically trigger replenishment orders when stock runs low, helping avoid those dreaded “out-of-stock” messages.
Fulfilment
The fulfilment side of the operation kicks into gear when customers place orders on your website. When a customer’s order is received (from your online store, marketplace, etc.). The order details are instantly transmitted to the fulfilment centre’s system. The order is verified, payment is processed, and a “pick list” is generated for warehouse workers.
Picking
Speed and accuracy are crucial during the picking stage. Warehouse staff use the pick list to locate the required products within the warehouse. Technology like voice-directed picking systems or pick-to-light systems may be used to streamline this process and reduce errors.
Packing
Once items are picked, it’s time to prepare them for their journey to the customer. Picked items are then carefully packed using appropriate boxes and protective materials to prevent damage during transit.
Branding elements like custom packaging or inserts can be included to enhance the customer experience. A shipping label with the customer’s address and other necessary information is generated and attached to the package.
Shipping
Fulfilment centers partner with shipping carriers to get packages delivered. The fulfilment centre works with carriers like UPS, FedEx and DHL. Carriers regularly pick up packages from the warehouse at designated times.
Shipping software like NimbusPost may be used to compare carrier rates and ensure you’re getting the most cost-effective shipping options for each order. You can let customers receive a tracking number, allowing them to follow the package’s progress in real time.
Conclusion
Don’t let logistics deter you. Whether you need the most affordable storage solution or lightning-fast shipping speeds, there’s an option out there that fits your business.
If you’re looking to streamline your fulfilment process and offer your customers a variety of competitive shipping options, NimbusPost might be the answer. With NimbusPost, you can compare different 3PL service providers, get smart warehousing service, and a dedicated account manager to streamline your eCommerce logistics.
FAQs
What is the role of an eCommerce warehouse executive?
The role of an eCommerce warehouse executive is to manage the smooth operation of the warehouse that supports an online store.
Is warehousing a function of eCommerce?
Absolutely! Warehousing is essential to eCommerce. eCommerce businesses need warehouses to securely store products before they are sold and shipped to customers. It enables quick locating, packing, and shipping of orders, ensuring customer satisfaction.
What are eCommerce warehouse management best practices?
eCommerce warehouse management best practices include:
- Optimised layout for picking and packing efficiency
- Accurate inventory tracking with a Warehouse Management System (WMS)
- Streamlined receiving and put-away processes
- Efficient order-picking strategies (zone, batch, or wave picking)
- Clear shipping policies and carrier partnership
