November 30, 2021 | Joe Pelej
This blog is the first in a series focused on material handling systems and software that optimize subscription box fulfillment. Sign up for our newsletter to receive future posts!
The Need for Speed
Consumers continue signing up for subscription box plans even after the pandemic lockdowns have subsided. The convenience of replenishment plans, the cost savings of access plans and the excitement of curation plans are why Gartner found that 75% of all companies with a direct-to-consumer channel will offer subscription services by 2023.
From niche brands to retail giants like Amazon, Target and Walmart, consumers have a lot of subscription offerings to choose from for e-grocery, cosmetics, meal kits, apparel, CPG, pet products, health and fitness, personal care, and many other product categories.
In this industry high-quality order fulfillment isn’t a perk, it’s the baseline expectation. Whether you’re a startup, an established brand or a 3PL (third-party logistics provider) filling orders for brands, warehouse automation offers the ability to deliver a premium experience, build customer loyalty and sustain growth.
New companies often start with homegrown, relatively low-tech processes to get orders out the door. For successful brands, hypergrowth and skyrocketing order volume drives the sudden need to level-up their order fulfillment game.
In video games, a “power-up” gives players extra abilities and benefits. In order fulfillment, pick-to-light systems empower employees to pick more orders at greater speeds. Subscription box brands have used pick-to-light to accelerate pick rate productivity by an average of 40% and achieve 99.9% order accuracy – often within the first few months of launching the solution.
Lights mounted on new or existing shelving, gravity flow rack or other storage media illuminate, directing employees to the correct product locations in a distribution center for items needed to fill an order. Read more about the top reasons to use pick-to-light, with a video introduction of the process.
Subscription boxes are often processed monthly, creating considerable volume fluctuations. Brands benefit from prototypical pick-to-light applications that have the flexibility to optimize zones and staffing for these peak times.
Scalable for Subscription Boxes
It’s common for emerging ecommerce and subscription service providers to start with approximately 1,000 SKUs, which is an ideal number for a first pick-to-light application. Yet these brands can continue growing at incredible rates, with some doubling in size every few months. Plus, many add SKUs over time to offer new and varied customer options.
Brands may need more pick lines in a facility to yield higher capacity, or the ability to incrementally expand by a few SKUs at a time. An agile pick-to-light platform allows them to swiftly scale operations as needed. The flexibility and reliability of the methodology has proven so successful, several are rolling out light-directed technologies across multiple distribution centers in their network.
Many 3PL, e-grocery, meal kit delivery services, ready-made food suppliers and other fulfillment operations leverage Matthews pick-to-light systems to quickly pick and pack fresh, refrigerated and frozen products. Lightning Pick offers optional lot capture and verification functionality for food and beverage handling customers. Light modules can alert operators to RF scan certain products (often with a ring scanner) for verification with the warehouse management system (WMS), ERP or other host system. The same feature supports pedigree tracking for medical and pharmaceutical products.
Throughput for Third Party Providers
Adaptable pick-to-light technology lets 3PLs service multiple subscription box customers with one picking system. Lightning Pick software dynamically reconfigures locations for easy switching between different customer lines in the same rack or shelving. A modular hardware architecture allows for a variety of light-directed applications, including batch picking carts and put walls for ecommerce order sortation. Pick-to-light solutions can also integrate with complementary systems such as container routing, print-and-apply labeling, weigh stations, quality control (QC) workstations, shipping sorters and more to progressively automate processes end-to-end.
Providing predictable, first-class fulfillment service is as important as creative products, great prices or other brand values. Pick-to-light applications help subscription box fulfillment operations manage growth, integrate new SKUs and efficiently balance work to manage shifting order volume levels.
Click Automation Insights next month or sign-up for our newsletter to read more about subscription box fulfillment challenges and technologies like warehouse execution systems (WES), put walls, print and apply labeling and other warehouse automation that can help.
Joe Pelej has 20 years of experience strategizing and implementing marketing programs for the material handling industry. Originally an employee of Lightning Pick, the leading provider of pick to light and other light directed warehouse systems in North America, Joe was excited to join the Matthews Automation Solutions team in 2011. Currently, Joe oversees the marketing strategy and branding for Matthews’ best-of-breed warehouse automation brands including Lightning Pick, Pyramid, and Compass. Outside the office, Joe enjoys outdoor activities with his family and fostering pets for the local humane society.