By Tom French
In the July 2014 edition of Wired there is an insightful article about the futuristic, seemingly “robot-based” reality of ecommerce logistics, as presented by the ever-growing Amazon. The article is titled “Ground War” and it gives the reader a basic overview of how ecommerce titan Amazon is threatening to wipe out the old fashioned convenience store by providing over 500,000 items for same-day delivery versus the average 150,000 stocked items in a brick & mortar competitor.
What this and all the other articles around this subject are not addressing is that the cost to service the ecommerce orders is still the responsibility of the manufacture of those products. Amazon may have the tech savvy that feels like something out of the future, but it can only go so far. It will be interesting to see what major software company (Google?) will set up the technologies to manage all orders from the various manufactures and consolidate at each of the large cities in the United States. Who accomplishes this will have the lowest cost to service.
This will require each manufacture to setup their warehouses to handle not only one full pallet of one item, multiple items on a pallet and each pick that will be sent as a small parcel shipment. I observed a recent start up CodeShelf whose cloud based low cost “pick to light” solution can optimize the process needed for each manufacture. It is time for manufacture to take on this challenge and start the process of changing their warehouse operations.