[et_pb_section fb_built=”1″ admin_label=”section” _builder_version=”4.22.2″ custom_padding=”40px||||false|false” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_row admin_label=”row” _builder_version=”4.22.2″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” width=”auto” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_column type=”4_4″ _builder_version=”4.16″ custom_padding=”|||” global_colors_info=”{}” custom_padding__hover=”|||” theme_builder_area=”post_content”][et_pb_text ul_item_indent=”30px” ol_item_indent=”30px” _builder_version=”4.22.2″ _module_preset=”default” hover_enabled=”0″ custom_css_main_element=”||h3 {|| font-size: 18px !important;|| margin-top: 1px!important;|| margin-bottom: 1px!important;||}||||.et_pb_text_0 h2 {|| line-height: 25px!important;||}||||h2 {|| margin-top: 3px!important;|| margin-bottom: 5px!important;||}||||.blog-toc ol, .blog-toc ul {|| list-style-type: decimal!important;||}||.blog-toc ul {|| list-style-type: disc!important;||}||||.blog-toc {||margin: 0!important;||}” global_colors_info=”{}” theme_builder_area=”post_content” sticky_enabled=”0″]There was a time when traditional warehouse management was back-breaking and mind-bending. Warehouse staff endured manual labor storing, picking, and packing all kinds of heavy items around. Warehouse managers, lead hands, clerks, and other specialists drowned in piles of inventory paperwork that drained their mental energy.<\/p>\n
But thanks to modern technology, warehouse and inventory management systems<\/a> came about and ignited a digital transformation in the industry. Collection, storage, and analysis of data became much easier, giving rise to data-driven warehouses. Today, data is a central pillar of warehouse management and has paved the way for more sophisticated technologies like AI to streamline the fulfillment center<\/a> and facilitate high-volume, high-velocity fulfillment. This has taken fulfillment to a whole new level, where same-day shipping is possible 99% of the time.<\/p>\n Let\u2019s look at the drawbacks of manual tracking and how leveraging big data and AI help optimize fulfillment. We\u2019ll also discuss how Logiwa addresses modern warehousing challenges and share actionable tips for transitioning to a data-driven warehouse.<\/p>\n <\/p>\n Contents<\/p>\n <\/p>\n Fulfillment providers who still use manual inventory management bear the following challenges.<\/p>\n Human errors, including counting and recording errors in manual warehouse processes, are among the leading causes of inventory fulfillment issues. It costs between $20-$60 to correct an error<\/a>, and businesses spend about 20% of their total budget to correct logistical errors.<\/p>\n These are the financial consequences for ecommerce retailers and 3PLs using manual inventory tracking. Worse still, human errors naturally rise as the intensity or amount of manual labor increases. This means a scaling company will incur more financial losses due to inventory inaccuracies.<\/p>\n Besides the associated financial losses, inventory inaccuracies, such as packing and delivering the wrong products, will dent your customer experience and lower your reputation among consumers. Repairing reputation damage is particularly difficult for ecommerce businesses, considering that\u00a0over 50%\u00a0of customers abandon a brand<\/a> and switch to a competitor after only one bad experience.<\/p>\n Order processing is intricate, even when automated. You can imagine how complex and exhausting it gets when processed manually, moreso, bulk orders of assorted items. Manually recording all stock-keeping units (SKUs) and double-confirming them when processing orders leaves room for errors. Such errors lead to order fulfillment failures, such as late or missed deliveries.<\/p>\n As a company grows and the orders snowball, manual fulfillment becomes impossible unless it hires extra staff as needed. Hiring a ton of additional staff is expensive and eats into the company\u2019s profit margin. This makes it exceedingly difficult for a retailer to scale organically and enjoy decent returns.<\/p>\n Big data<\/a> is the compilation and analysis of vast amounts of warehouse data to gain insights that help you optimize and streamline warehouse fulfillment operations. There are numerous sources of big data in a warehouse setting, including:<\/p>\n The top advantages of utilizing big data to facilitate AI-driven warehouse optimization<\/a> include:<\/p>\n Enhanced real-time inventory tracking<\/b><\/p>\n Big data helps you review and track inventory automatically to know when to restock, what items to replenish, and the sufficient amounts to stock. It helps you avoid common inventory problems such as overstocking or understocking.<\/p>\n Improved decision-making capabilities<\/b><\/p>\n With the hyper-competition in the ecommerce sector, fast and accurate decision-making can make or break a retailer. Leveraging big data from your inventory-tracking IoT devices and other big data sources helps you make informed decisions, such as when to scale your business and the technologies to invest in.<\/p>\n Identification of operational bottlenecks<\/b><\/p>\n Analyzing big data for consecutive months shows you performance patterns. By analyzing low-performing periods, you can establish and resolve the bottlenecks behind the lulls and resolve them to enhance operational efficiency.<\/p>\n It seems everyone has jumped on the artificial intelligence band wagon. And lots of the talk is just that. But in the world of high-volume fulfillment AI is making real contributions. These are some prominent roles of AI in warehouse management<\/a>:<\/p>\n Here are just two examples of how AI isn\u2019t just talk, but has contributed to dramatic changes for leading companies:<\/p>\n\n
The limitations of manual tracking in warehousing<\/h2>\n
Recurrent inventory inaccuracies due to human errors<\/h3>\n
Order processing and fulfillment inefficiencies<\/h3>\n
Difficulty in scaling operations to meet increasing demand<\/h3>\n
Embracing big data in warehouse operations<\/h2>\n
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The benefits of leveraging big data analytics in fulfillment centers<\/h3>\n
Integrating AI for advanced warehouse insights<\/h2>\n
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