Most modern companies have more than one sales channel, distributing products to both B2C and B2B customers. Your B2C customers demand that their orders are shipped quickly with 100% accuracy. Your B2B customers expect the same – without accepting so much product that it takes up precious storage space.
To serve both audiences, you may think that you need to separate your products into silos and work with different third-party logistics (3PL) providers to handle storage and distribution of each. Fortunately, however, there are many 3PLs that can handle all your sales channels simultaneously. Welcome to omni channel distribution.
What is omni channel distribution?
With omni channel distribution, your 3PL manages your entire inventory under one roof (figuratively speaking; you can spread your inventory out across its warehousing network). As orders come in from any channel, your products are pulled from the same inventory pool and prepared for distribution.
The role of the WMS
If this distribution to multiple channels sounds simple, it is – thanks to sophisticated warehouse management software (WMS). This software is the cornerstone of the modern 3PL warehouse and allows for your entire inventory to be managed by one centralized system, regardless of sales channel. It also allows for seamless integration (typically via EDI) between your systems and your 3PL’s, and between your 3PL’s system and your customers’ systems. Its capabilities include:
- Inventory management: The WMS will record and manage your products according to key characteristics like warehouse location, available quantity, pallet ID, serial number, lot number, and expiration date.
- Order status: As orders are received, their shipment status and parcel tracking information can be viewed in real-time.
- Label generation: eCommerce orders will trigger the creation and printing of shipping labels, while retailer orders will trigger labels that comply with individual retailer specifications.
Importantly, these big-time capabilities come with a hefty price tag – as much as six figures. However, partnering with a 3PL that already has a WMS allows you to take advantage of its features – without footing the bill for its cost.
Your 3PL’s WMS will integrate with your chosen eCommerce platform (e.g., Amazon, Magento, Shopify, Big Commerce). As orders come into the WMS, it will provide associates with order details and item locations, prepare shipping labels, and schedule shipment with the 3PL’s chosen carrier. Products will then be packed, labels affixed, and final QA will be performed.
Most 3PLs will ship same-day for orders received by mid-day or slightly later. However, the exact timing can be worked out between you and your 3PL during contract negotiations.
In addition to the cost savings associated with using your 3PL’s WMS, you can also save money through your 3PL’s carrier relationships. Your 3PL will likely handle eCommerce fulfillment for a multitude of clients. This allows it to negotiate better rates with the carrier based on that aggregate volume. Your 3PL should then pass the savings on to you.
As with B2C distribution, orders from retailers and other B2B customers will feed into your 3PL’s WMS. The system will then create UCC-128 labels and additional labels specific to your customer. From there, the 3PL will coordinate the outbound shipment – either with its internal transportation arm or with an external provider.
Because of the time it takes to coordinate the outbound distribution, most 3PL’s will request that B2B orders be submitted by the end of the business day prior to shipment. Of course, supply chains don’t always operate according to plan and many 3PLs will honor same-day shipping when possible.
JIT delivery for manufacturers
In addition to B2C and B2B, there is another form of distribution that some 3PLs can handle for manufacturers. With just in time delivery, the 3PL will store component parts and kits needed for manufacturing and then deliver those items to the manufacturer at set intervals – sometimes several times per day. The parts only appear onsite when they are needed. This frees up the manufacturer’s space to focus on production without eating up valuable floor space with component inventory.
Turn to Kanban for Mid-Atlantic omni channel distribution
With over one-million square feet of warehousing space halfway between Boston and Miami, Kanban Logistics has the infrastructure to support your omni channel needs. Our prime location allows you to reach 70% of the U.S. population in one day, and is supported by ISO:9001-2015-certified processes and a robust WMS that can manage your sales channels with ease. To learn how Kanban can support all of your sales channels from the Mid-Atlantic, contact us today.