How Intelligent Order Routing Can Help Tackle Warehouse Capacity Constraints
What’s In The Article:
- Introduction about the warehouse capacity constraints
- Why and what is intelligent order routing.
- 3 benefits of using intelligent order routing
- Conclusion with a plug on ShipWorks
Constrained capacity is a serious issue faced by global supply chains and logistics networks. There might be constraints in various areas of the supply chain that managers and stakeholders have to anticipate and deal with. Areas like equipment availability, labor shortages, driver and container availability, etc., might all be causes for concern, creating bottlenecks in the supply chain. In fact, managing capacity constraints was the number one operational challenge by 53% of respondents in a recent survey.
Warehouse capacity constraints, ranging from lack of space to lack of human resources and other such roadblocks, create cost pressures, delaying distribution. Order picking, in fact, a labor-intensive process, might be a major bottleneck, responsible for up to 55% of warehouse management costs.
While anticipating capacity issues and planning for them is the norm, it’s not possible to manually accurately predict possible bottlenecks and plan for them in advance. In this scenario, a supply chain manager, logistics manager, or warehouse manager looking to mitigate damages can turn to digital solutions and 3PLs to solve their problems.
Plus, when consistently facing space and order fulfillment issues, a look at one’s overall warehousing strategy can be beneficial. As your warehousing needs become more complex, stakeholders can invest in smart inventory management solutions like intelligent order routing.
What is intelligent Order Routing?
Intelligent order routing (also known as flexible, automated, or smart order routing) lets you manage all of your inventory across multiple warehouses, spanning different locations, regions, and more, using a single digital system. You can essentially manage all your inventory and warehouses at the click of a button.
This ensures that businesses have sufficient stocks across locations. It also allows for flexibility by anticipating and allowing stakeholders to move inventory efficiently. There are a host of automated inventory planning and management software systems that shippers can rely on for their warehouse capacity needs. Intelligent order routing is one of the functions these software tools provide to facilitate and automate shipping processes.
Intelligent order routing not only helps businesses save costs but also generates revenues.
3 Benefits of using intelligent order routing
With intelligent order routing, you can:
- Create custom workflows or logistics pathways depending on factors such as location, order value, channel, etc.
Planning inventory volumes to be shipped to various warehouses is a part of most inventory managers’ and shippers’ duties. But with intelligent order routing, this function can be automated, allowing the software to allocate the resources based on various factors to ship and ferry inventory. Different pathways are chosen and created due to this system, allowing for the quickest and most cost-effective ways to complete the order efficiently.
Using the ShipWorks Hub, customers can enable the use inventory when routing orders option to take into account which warehouse can fulfill an order based upon current, available inventory levels. Also, by importing a list of products into ShipWorks and associating the products to a warehouse, ShipWorks can intelligently route the orders to the correct warehouse by the product SKUs contained within the order.
It is possible to drill to the SKU level as well as observe macro operations using intelligent order routing. This ensures that order fulfillment is cost-effective.
- Centrally manage order fulfillment from multiple warehouses
Starting when a customer places an order online, intelligent order routing or brokering ensures that the order reaches the right warehouse or fulfillment center for optimum service. Intelligent order routing ensures that a business’ order fulfillment strategy is scalable and adaptable to changing demands.
In fact, using the ShipWorks Hub, shippers can add warehouses and link them to the software at each warehouse location. This way, ShipWorks will automatically route the orders to the warehouse that is closest geographically, to the shipping address of the order. Stakeholders can also intelligently split and route orders based upon available inventory, including splitting single SKUs across multiple warehouses.
- Keep stock at optimal levels across multiple warehouses
Finally, intelligent order routing enables managers and shippers to anticipate demand and plan for any uncertainties fairly quickly and efficiently. As a result, businesses can plan and stock for demand and ensure that orders are not delayed due to a lack of inventory.
With businesses managing to fulfill orders on time, repeat business is also likely to increase. As a result, customer satisfaction and higher revenues can be expected.
Order routing results in getting orders to customers quicker and keeping stocks at an optimal level across multiple warehouses. For businesses operating all over the globe, this is a major advantage over the competition. Implementing intelligent order routing via an order routing system in a smart shipping hub like ShipWorks is an important part of keeping your warehousing operations and your business competitive.
ShipWorks intelligently routes orders using a combination of:
- Automatic Intelligent Routing
- Product Level Routing
- Inventory/Stock Levels
- Automatically Splitting Orders Across Warehouses
- Platform Specific Routing
If you want to know more about intelligent order routing to manage capacity constraints, schedule a demo or click here to know more.