batch to single-unit processing. As inventory levels change, managers need the ability to see every order at every stage and the
aging of orders on the floor.
Seasonal and Promotional Peaks: It may be a challenge
for companies to offer same-day fulfillment during peak times.
Decisions around how to handle peak significantly impact DC
design and levels of investment in material handling equipment. If
companies want to continue to offer same-day fulfillment during
peak without supersizing fulfillment engines, they may need to
include alternative flow paths for single orders and some offline
processing as a way to meet demand during peak.
Additional Impacts: There can also be a few less obvious
impacts where same-day fulfillment shortens the window for back
of house processing and communication, including:
• Increased need for efficient error and exception handling.
• Increased need for faster checks and balances processing
before orders get to the floor. Companies must speed up the
processes for credit checks; address validation; communication of
inventory availability, stock-outs and backorders; and how they
release orders to the floor.
The Bottom Line
When considering a move to same-day fulfillment, you want to
balance the cost of the changes required against the potential
Moving to same-day fulfillment has brought marquis companies
like Amazon, Macy’s, and Nordstrom significant benefits — chiefly,
the ability to meet customer demand for faster order-to-delivery
time. As a rising tide lifts all boats, these leaders are raising the
bar for you in the process, and same-day fulfillment is becoming
the new normal. But the move to accelerate fulfillment means
sweeping change for the DC and other parts of the organization.
The question for most companies goes beyond whether they
can do same-day fulfillment, to how to do it in a way that makes
sense for the business. How do you determine that? The key is in
balancing service with cost, and the pivot point of that fulcrum is
choosing the right cut-off time that makes same-day fulfillment a
realistic approach for meeting customer demand and capturing a
Companies with complex distribution operations trust Fortna to
help them meet customer promises and competitive challenges
profitably. Fortna’s expertise spans supply chain strategy, distribution center operations, material handling, supply chain systems,
organizational excellence, and warehouse control software. For
more information, visit www.fortna.com.