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Ecommerce order fulfillment: cartonization = cost savings

It turns out that just like Goldilocks, the “not too big, not too small” principle can have a big impact on shipping costs, which are based in part on box dimensions. That’s more crucial than ever as retailers have to navigate the squeeze between customers’ desire for free and/or fast shipping and the retailers’ need to operate cost-efficient order fulfillment operations.

Order Fulfillment: plan, pick, and pack for perfection!

What is cartonization?

Cartonization technology uses algorithms to specify the best box size and shape for each order being fulfilled to optimize how orders are packed and shipped. It uses algorithms to specify the smallest and optimum dimensions possible for each order being fulfilled. It specifies how many cartons to use—and what size they should be. Needless to say, this reduces parcel shipping costs significantly.

“Determining the most cost-effective way to pack an order is inherently complex. It requires a level of computation that is beyond the training of most packers,” explains Parcel, and that’s why cartonization algorithms are so valuable.

Cartonization works from a custom dataset (unique to each ecommerce business) identifying dimensions and weights for every product for pick, pack, and ship. It optimizes the dim weight—and thus, the final rate—used in determining freight costs.

Cartonization algorithms save time in having humans guess which box to use, and the technology organizes the warehouse workflow. Workers know exactly how many boxes to build—and what size, and when. Integrated with a warehouse management system (WMS) and bar-coding technologies to confirm picks, it drives up order accuracy. Pickers are picking directly into the shipping carton and verifying every step. In addition, the technology also accounts for fill material that protects products for a satisfying customer experience upon delivery.

Cartonization – save shipping & labor costs

Cartonization saves shipping costs. What’s more, it saves labor costs through an organized workflow in the order fulfillment warehouse. It promotes order accuracy. Finally, it earns customer loyalty by creating satisfying customer experience.

Implementing cartonization requires a robust Warehouse Management System (WMS), as well as up-front costs and high-level IT expertise. Because of the time and costs involved, relying on a capable 3PL company helps retailers achieve the benefits of cartonization without capital expense. This frees up resources to market and sell products. The integrated features of a WMS, including bar-code technology, enable a host of best practices to optimize the business.

Want more best practices in order fulfillment? Check out the blog on best
practices for ecommerce packaging
. Looking for an order fulfillment company to raise the bar for your company? Contact
us
to discuss your needs. We’re here to help!


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