Your guide to automated fulfillment in E-commerce

[Updated post from March 16, 2021]

There's nothing more valuable than time in the world of e-commerce fulfillment. Today's online shoppers expect to receive orders quickly and seamlessly. But optimizing the order fulfillment and delivery process starts at the very beginning of the supply chain - long before you've received a single order.

All those manual tasks that characterize fulfillment, from transferring orders to traveling around fulfillment centers picking items, can seriously hurt productivity. Inefficient fulfillment adds hours or even days to completing orders, resulting in backlogs that jam up critical systems.

This is where automated fulfillment can make all the difference to your brand's ability to exceed customer expectations and reduce costs. But what exactly is fulfillment automation, and how does it remove inefficiencies from the order fulfillment process? 

In this post, we're going to dive into the world of automated fulfillment - and how Ryder can help.

What is order fulfillment?

Before we dive into the intricacies of automated fulfillment, we need to take a step back. Namely, what happens during the order fulfillment process?

E-commerce order fulfillment refers to several workflows that must take place to complete an order and send it to the end customer. This includes storing inventory, receiving orders, assembling packages, and arranging shipping and delivery.

No matter whether you are a retailer, wholesaler, or an e-commerce business, it's the role of order fulfillment to ensure that customer orders are filled accurately on time, and in a cost-effective manner. As a business grows, order fulfillment has a significant impact on customer satisfaction and the overall success of a brand.

What is automated fulfillment?

Automated fulfillment refers to the use of technology to automate the order fulfillment process. Automation helps to streamline key steps such as inventory management, order processing, picking and packing products, shipping, and returns management.

The goal of automated order fulfillment is to increase efficiency and accuracy by removing repetitive tasks from human workflows. This doesn't necessarily mean an influx of robots onto the warehouse floor; fulfillment automation also includes hardware and software systems that track productivity or identify bottlenecks in order fulfillment processes.

For example, a 3PL may invest in a conveyor belt system to move inventory around a fulfillment center more effectively, or implement an Order Management System (OMS) that integrates directly with your online store to receive new orders in real time.

According to the 2022 26th Annual 3PL study, the top three technologies that 3PLs plan to invest in over the next three years is 1) robotic systems in the areas of high-density storage, picking, and palletizing; 2) autonomous forklifts, and 3) wearables.

In sum, automated fulfillment operations offer several benefits. Adding automation allows 3PLs to re-deploy workers for more complex tasks worthy of their expertise. This increases efficiency and cost savings while reducing errors in the fulfillment process. For businesses, automated fulfillment centers give access to perks like faster fulfillment and lower shipping costs, which mean higher customer satisfaction and a higher likelihood of repeat purchases.

The challenge: Enabling your fulfillment operation to scale

Getting fulfillment operations off the ground isn't as overwhelming as it might appear. So long as you have somewhere to store inventory and some packing materials on hand, even emerging brands can get a good handle on in-house fulfillment.

The real challenge is for growing businesses. What happens when your high-volume operation is growing too quickly for order fulfillment to keep up?

This can seem like a good problem to have. But a struggling fulfillment operation results in less-than-satisfactory outcomes for e-commerce businesses. This includes late deliveries, higher shipping costs, and higher rates of human error.

Increasing your labor force and renting more fulfillment center space provides a partial solution. However, this is rarely cost-efficient for warehouse operations over the long term. More orders mean more personnel and more infrastructure, which creates an upward spiral in fulfillment costs.

By investing in order fulfillment automation to replace manual workflows and speed up fulfillment, brands can achieve a far more cost-effective operation - even with fewer resources.

Ryder: Advanced fulfillment automation at every step

Partnering with an e-commerce fulfillment provider that gives you access to streamlined, automated fulfillment workflows. These help to eliminate inefficiencies and maximize cost savings by making it easier to identify where they could be performing better. A 3PL partner who is dedicated to continuous improvement ensures that your e-commerce fulfillment operation will continue going from strength to strength as you scale.

This is why Ryder invests heavily in fulfillment automation at every stage of fulfillment to deliver best-in-class services tailored to the precise needs of every business.

Fast, accurate order processing

While last-mile logistics often dominates the discussion about home delivery, the answer lies much higher up the supply chain; from the moment an order is received. Put simply, the quicker a new order is processed, the easier it is for brands to achieve speedy delivery timeframes.

Expectations for rapid e-commerce delivery have never been higher – and this is only going to increase as giants such as Amazon set new benchmarks. According to Wall Street Journal article, the number of consumers happy to wait more than 5 days for home delivery declined from 74% to 60% between 2012 and 2016. Moreover, the growing popularity of BOPIS (Buy Online, Pick-Up In-Store) has made the demand for same-day order fulfillment commonplace.

"We are Shopify-based, so the technical integration with Ryder was seamless and straightforward. The onboarding process was very professional, and we saw how much of management’s attention went into it." Zvika Alon, COO of Edikted.

Ryder enables merchants to stay competitive by offering two-way integrations between its WMS and major e-commerce platforms such as Shopify. This allows new orders to be automatically allocated to automated centers, reducing the lag between orders being placed and order fulfillment beginning.

Optimized picking and packing

When a customer places an order, the fulfillment center will send out a request for a warehouse to "pick" the items required and "pack" them for shipment. But picking and packing is often the stage where the most time and efficiency is lost during the fulfillment process. Confusing storage systems, heavy merchandise, and long travel times between pick locations all contribute to brands struggling to shorten pick times, especially as their brand grows.

Using robotic automation to assist warehouse staff with the picking process is a growing trend across retail, as brands grapple with the need to speed up order fulfillment. Ryder deploys over 150 LocusBots across our facilities to map the most efficient travel routes for our pickers and identify 'hot spots' where dynamic pick locations should be added.

This unique cooperation between human and robotic labor has allowed us to improve average pick times by as much as 20 seconds per unit, massively improving warehouse management and turnaround times for our customers.

Advanced shipping method selection

Automation within the shipping process is a growing area of automated fulfillment, as brands grapple with rising costs and the difficulty of comparing shipping options in real time. General Rate Increases, Peak Season Surcharges, and inbound freight costs all serve to lower profit margins and make e-commerce business management incredibly time-consuming.

Finding that ideal balance between shipping speed and cost is the ultimate challenge for e-commerce businesses. Economy shipping methods are much more affordable (especially if your brand is footing the bill) yet may displease customers who have to wait a long time for their orders. Likewise, expensive priority shipping might be the gold standard, but it's rarely cost-effective.

“Order Rules are a fantastic example of how intuitive the Ryder platform is. I was able to set up our core shipping strategy with no programming experience whatsoever. Our customer experience agents have also been able to jump in to retrieve information without any lengthy tutorials. It’s the ideal system for a busy e-commerce brand like ours.” Jon-Mark Craddock, Director of Logistics at Tuckernuck.

In addition to maintaining a variety of wholesale partnerships with major and local carriers, Ryder also offers customers intelligent shipping method selection via its SmartRate Selection tool. Easily find the best carrier rates based on your order history with powerful automation designed to streamline your shipping strategy.

Smoother returns management

Reverse logistics is often overlooked when it comes to fulfillment automation, despite returns costing U.S. retailers an estimated $816 billion in 2022.

E-commerce businesses never want to experience an influx of returns. But a seamless returns process is a major tool for customer retention. 95% of consumers say they will shop again with a brand that offers a positive return experience!

Yet returns and exchanges are a major point of friction for customers. This is because many retailers require returns to be approved manually, leading to lengthy delays in issuing refunds or replacement items.

This is where return automation software is your best ally. It enables brands to configure every step of the returns process – from return authorization to shipping and restocking.

Offering native integrations with three best-in-class return automation systems (Loop, Returnly, and Happy Returns by PayPal). Ryder helps to liberate your return process from endless emails and delays. As soon as a customer logs a new return or exchange, this request is automatically shared with your fulfillment center so it can prepare replacement items and adjust inventory levels. This ensures that returned merchandise doesn't pile up inside your distribution center and miss out on valuable opportunities for resale.

At its heart, fulfillment automation allows brands to remove friction from their online shopping experience. More efficient fulfillment processes allow customers to get their goods faster and receive more immediate customer care, creating a more loyal customer base. Consider talking to your e-commerce fulfillment provider about how you can bring automated fulfillment centers into your workflow. If you're currently self-fulfilling, consider partnering with Ryder to bring productive, cost-effective fulfillment to every stage of your e-commerce fulfillment operation.