Wholesale distributors, fulfillment companies, and manufacturers can now accurately label and track packages, quickly provide rate and service information during the order entry or fulfillment process, and identify time-in-transit.
Your WMS shipping software system should offer users a sophisticated shipping documentation capability that will both enhance and simplify the production of all needed shipping documents. As you evaluate your current (or future) WMS shipping solution, does it include:
- Pack list for the end customer
- Bills of lading and manifest for the carrier
- NAFTA Certificate of Origin and Proforma
- Commercial Invoice for Customs clearance
- US Shippers Export Declaration to meet US government regulations
- Shipper Letter of Instruction for freight forwarders
- And other regulatory documents such as the IMO Dangerous Goods Declaration
In the supply chain execution world, response time is everything. If your warehouse management system is not tightly integrated with your shipping software or isn't fast enough, or doesn't allow staff to work effectively with multiple parcels and LTL carriers, it's slowing you down.
A checklist to evaluate your shipping process and minimize errors:
- Is the complete order shipping process streamlined for both domestic and international operations?
- Does your operation meet shipping delivery dates 100% of the time?
- Have you eliminated shipping errors?
Factors in cost-per-error calculations:
- The cost of a lost or disgruntled customer
- The cost of re-shipping incorrect orders
- Returns or rework costs
- Administrative costs
- Additional handling costs
- Additional shipping costs
Shipping errors can be divided into these categories:
- Wrong item ordered is an error that could originate with the customer or the sales representative.
- Keyed incorrectly is an error that originates in the office but may be blamed on the warehouse.
- Picking errors clearly originate in the warehouse.
- Defective errors are caused by faulty product, and sometimes this problem is concealed.
- Miscellaneous is the catch-all for all other errors.
- Are your shipping costs in control?
- Does your operation respond instantly and accurately to customer delivery status requests?
- Do you have the ability to track and trace product shipments in real-time?
- How well are the in-process and finished goods inventories managed?
- Is your production with available materials aligned with current demand?
- How well is your inventory management integrated with machine control in production?
Pause and ponder the questions above to minimize errors. Frequent errors, for whatever reason, have the potential to negatively impact customer relations and the company’s bottom-line.
The reality of errors
Voxware, a leading provider of voice solutions, presents a clear picture of how order fulfillment errors and the resulting returns process, is perceived by the customer. Highlights from the survey, which collected responses from 500 consumers, include:
54% of respondents stated that the reason for returning an item purchased online or by phone is because the item is the incorrect size or color.
97% of respondents stated that the returns process is important to their future intentions to shop with a retailer.
73% of respondents who receive an incorrect item after already returning it once stated that they are much less likely to shop with that retailer online or by phone again for future purchases.
45% of respondents who have experienced continuous returns process issues with particular retailers stated that they have limited shopping with that retailer altogether (both online and in-store).
26% of respondents expect the correct item to be shipped to them within one to two days after returning the incorrect item.
Customer Expectations for Speedy, On-Time Delivery
Respondents answered how quickly they expect a retailer to deliver an item that they purchase online or by phone assuming the retailer is using standard shipping:
4% said 1-2 days
42% said 3-4 days
44% said 5-6 days
10% said 7 or more days
The Cost of Shipping Errors
When errors occur and the customer notifies you of the incorrect shipment, you now have the cost to retrieve the wrong materials (pickup, possible repackaging and restocking. If the original package is damaged there is a possibly of not being able to resell it.
Included in the cost of the error is the cost to pick, pack and ship the right item. Then comes all of the accounting to correct the inventory, debit and credit the customer account, plus the added time that is almost guaranteed to be spent explaining the paperwork to others.
What is the cost of shipping errors vs upgrading or adding WMS shipping software? The answer varies case by case and an assessment can reveal the answer.
During an evaluation, we use a ERP assessment in the form of an Excel spreadsheet. This assessment tool leaves no stone unturned with over 300 questions. You can download the assessment here to get you started. If you prefer, our team can help with an assessment. Contact us here.
We have a solution
Most ERP software systems were not designed to deal with the complexities of the warehouse and supply chain.
Our WMS software system provides the functionality to support warehouse management within your existing ERP framework. COLLECT® WMS software will meet the challenges of your simple to complex warehouse management needs while preserving your existing financial investment in business software.