Basic E-commerce Warehouse Operations

What is E-commerce Warehousing?
It’s the storage of physical goods before they are sold online. The procedure includes safety and storing the products securely, tracking the items where they are located, when they arrived, timing from when they are stocked and the stock on hand at any given time.

Standard Operating Procedure for E-commerce Warehouse Operations:

Warehousing is one of the most important aspect of running an eCommerce business. Either you have a big or small business, its very important to keep your inventory safe and secure in storage before selling online. Ecommerce firms have several tasks on a regular basis but the most important is of effective warehousing and order management.

A warehouse stands as an integral part of the supply chain for ecommerce operations. Managing the stocks in the warehouse is whole another tasks. Here, you have to deal with the inbound, inventory, order fulfillment, shipping, logistics and many more in a limited time frame which is not an easy task.

Let it be any ecommerce retailer, one of the main focus will be warehousing and delivery. Fast delivery and order consistency impacts the loyalty of the customer. 

The main procedures for any eCommerce warehouse operations are:

• Inbound Process
• Inventory Process
• Order Fulfillment Process
• Logistics Shipping Process
• Returns Process

INBOUND PROCESS:

The inbound process flow in a warehouse starts when the product or SKU (stock keeping unit) is obtained from an external source such as suppliers or vendors that arrives in the warehouse location. Generally, in ecommerce operations, a purchase order is placed to the supplier before the SKU’s been arrived. Once the commodity from the supplier reaches the receiving dock, the warehouse operational procedures are carried out to get the goods into the storage area for further operations.

The steps involved in the inbound process are below:
1. Purchase Order
2. Gate Entry
3. Quality Check
4. Wrapping & QR Coding
5. Goods Receipt Note (GRN)
6. Putaway Assignment Process

INVENTORY PROCESS:

Ecommerce inventory management is the act of measuring the amount, location, pricing, and mix of products available from your business. These could be products hosted in your own warehouse, provided through a third-party logistics fulfillment center (3PL). Inventory management in ecommerce plays a pivotal role in the order fulfilment process. The efficiency of inventory management is very crucial to determine the success of supply chain management in ecommerce business.

Factors that determine core inventory management involves:
1. Putaway Assignment
2. Inventory Control 
3. Cycle Count
4. Stock Transfer
5. ABC Analysis
6. Just in time (JIT) inventory
7. FIFO Method

ORDER FULFILLMENT PROCESS:

Order fulfillment in e-commerce is the process by which all the steps a company takes between receiving a new order and placing that order into the customers hands within a limited time frame. The practice involves warehousing, picking and packing the product, shipping it and sending an automated email to the customer to let them know the order is in transit.This process can be completed in-house by an ecommerce company or outsourced to a third-party logistics (3PL) provider.

The below are the steps involved in ecommerce fulfillment process:
1.  Receiving online customer order.

2. Customer order received in the ERP and notification send to the customer.
3. Request send to the fulfillment center for further procedures.
4. Warehouse team pick the order items as mentioned in the order picklists.
5. Customer order is packed and handed over to the logistics for shipping procedures.
6. Order is been shipped out and dispatch confirmation send to the customer.
7. Order is been delivered and received by the customer.
8. If required, refund or exchange process is done.

LOGISTICS SHIPPING PROCESS:

Ecommerce logistics refers to the processes involved in storing and shipping inventory for an online store or marketplace, including inventory management and the picking, packing, and shipping of online orders. Faster shipping options result in more sales for ecommerce businesses, but not every brand has the logistics network to do this themselves. This is why many find a partner to handle ecommerce logistics like a 3PL. But with so many middlemen involved, orders can be delayed if one link in the supply chain is broken.
Steps involved in shipping:
1. Manifested orders are shelved and sorted area wise.
2. Runsheet's are generated assigned to the concerned drivers.
3. Orders are shipped.
4. On Last mile, once orders get delivered, Delivery Run sheet get signed.
5. Proof of delivery (POD) is documented.
6. NDR orders are been returned.

RETURNS PROCESS/ REVERSE LOGISTICS:

The Return process is defined as any goods returned to the warehouse by the end customer, retail outlet or courier for any reason, and all packed, shipped orders where the Ordering Person cancelled the shipped.

There are two types of returns:
1. Customer initiated Return (CIR)
2. Non-Delivery Receipt (NDR) returns.

Conclusion:

The demand of online purchase is increasing day by day. Customers need to receive their purchased goods within a limited time frame. So, in a competitive atmosphere, every ecommerce business entities need to do fast shipping and there is absolutely no shortcut to delivering it. Good inventory and warehouse management for your online store can help you save money and time while meeting customer expectations. Having a strong ecommerce logistics can maximize efficiency, reduce shipping costs and provide a great customer experience.