Warehousing and Distribution
This white paper explain the concepts behind warehousing and distribution and what you need to know before you get started.
Warehousing and distribution will be an essential part of your online or mail order business. Storing products and shipping them efficiently for most business seems easy, but it requires a well oiled machine to keep things running smoothly.
You will need to decide on how much space you will require when choosing a warehouse or shop with stock-room, and look at its location. Warehousing isn't cheap in prime locations so you may need to be willing to travel around to find one that is suitable for you and you business, and of course in a safe / secure environment!
You will need to make sure that products in your warehouse are organized, easy to find and transportable from that location. An efficient system will be needed to process all the order from the point of sale. Stock control can be quite complex so you will need to look for a way that suits you so stock management won't be a problem.
Keep an up-to-date record of what products you have in store and what needs replenishing. Don't rely on stock data from the previous day or week. If you are shipping a lot of products, it is essential that you know what is going in and what is going out of your warehouse. Customers don't like being sold a item that you don't have in stock without knowing this information first.
To avoid such problems consider using a system that works in real time and can be integrated into your point-of-sale system, either online or over the phone. A paperwork system just doesn't work anymore. It's slow and certainly not efficient. investing in a good stock control system is a must for any new or existing business.
Warehousing isn't cheap. You need to consider insurance costs, handling costs and storage costs. Keeping up-to-date records of stock inventory and sales will aid you in deciding how often to replenish goods depending on sale data. Devoting 30% of your entire warehouse to a product that sells infrequently is not making good use of stock control, neither is leaving insufficient time to restock a top selling line.
The chances are, when you first start out you are not going to have large warehousing and distribution centres like Argos or Dell. You almost certainly wont have both, but it is good practice to think about the future and start to operate like these large corporations. They rarely have problems with distribution and stock control because they have complex and well oiled systems in place that help them to meet customer demands and delivery dates.
Distribution is the delivery of products to a customer and it can vary in cost depending on the size of goods, using a third party delivery service or shipping by yourself. Sales need to be processed quickly and shipped within a certain time frame. They need to be accounted for and once delivered you should receive a confirmation that can be logged onto the system so that orders can be tracked by your sales and support staff.
If you are a direct sales company then there should not be any third party between you and your customer. If you are an online trader, direct sales are probably going to be the best choice for you. Also if you have a larger turnover, a cheaper choice by far. You will want to eliminate any extra costs, so processing and delivering goods by yourself is one way to do this.
You should be able to calculate shipping prices depending on weight, size and location and give an estimate to your customer at the point of sales. You will need to store a massive amount of data on each product so that you can estimate your delivery costs.
Being able to offer a choice of shipping options to your customer is attractive and it also means you don't need to rely on one type of service all of the time. Using your countries mailing system is sometimes efficient and is secure enough for smaller, less valuable items.
Cyrane from something4 Ltd is a complete all in one system that can process orders from the point of sale all the way to the warehouse and distribution centre. It is simple and easy for you to use, even with its advanced features. It will process credit card orders and offers a range of anti-fraud measures for extra security.
Cyrane is cost effective and can save your company money because it eliminates the need for highly skilled technicians and extra staff at both ends of the business. It can manage your products, their variants, shipping methods and prices.
It has been developed to integrate seamlessly into your business and be able to process and manage all your customers, their records and orders. It can manage pick, pack and dispatch of products from your warehouse and update stock in real time. It is also easy to synchronize with your other sales systems, such as telesales or mail order. Cyrane has been designed to be flexible to your needs.
