Aug 24, 2021
Intelligent Automation holds the key to a great omni-channel experience
In today’s omni-channel world, brands need to be switched on 24x7. With the pandemic accelerating the depth of digital consumer connectivity, customers are using multiple channels to complete their purchase decisions in today’s fast-paced ‘Phygital’ world. This makes demand anticipation and order fulfilment a more complicated affair as FMCG brands navigate between offline and online distribution channels and are constantly straddling both to ensure they are ‘available’ to customers whenever the desire to shop arises.
Brands that need to stay relevant in the future will have to bake omni-channel distribution as well as their direct-to-market and direct-to-store strategies into their distribution models, while taking into consideration shorter SKU life cycles, a set of ever-evolving and growing customer expectations as well as increased competition at all points of sale.
Distribution is the differentiator
Recent NielsenIQ research illustrates the need to ensure optimal distribution. According to NielsenIQ, an average of 1,059 SKUs are launched every month but only 10% survive. The differentiating factor: distribution. [1] Often, the only difference between failure and success for a brand’s stock keeping unit (SKU) could be an ‘off-the-shelf/out-of-stock’ notification.
Further, NielsenIQ observed that it became imperative for companies to restructure assortment optimization strategies due to emerging factors like streamlined consumer budgets, a growing preference for neighborhood stores and e-commerce channels.
Manufacturers need to get their skin in the game
In India, where distribution is largely fulfilled through Third Party Logistics (3PL) players and intensive labor-led distribution networks, the pandemic serves as a reason for companies to get more involved in reducing dependence of their distribution supply chains that are based on human labor alone.
While e-commerce players have considerably invested in ramping up their warehouse and logistics capabilities, manufacturers too need to consider setting up their own intelligent warehouses or working with their 3PL partner networks to capitalize on technological advancements by leveraging intelligent automation.
Picking the right partners is key
The storage industry is a crucial cog in the wheel that will need to work closely with automation players to ensure that storage options available for intelligent solutions are compatible and serve the purpose.
In a recent MasterClass by Körber on ‘The Right Storage Method for Warehouses’, experts focused on the challenges associated with conventional warehousing and picking solutions and the role of automation in storage solutions to help optimize shelf space, throughput of goods and overall productivity apart from driving cost benefits.
As a group, we have provided customized supply chain solutions to global FMCG companies in the European and North American markets based on specific requirements. For instance, a hygiene products manufacturer required optimization at the main storage level. Due to high volumes, storage density had to be high. So, automation at the main storage level served two purposes: achieving high storage density and making picking (which remained a manual process) more efficient. Similarly, for a beverage manufacturer, the entire storage operation across storage, replenishment and dispatch was automated given the heavy loads.
Through a combination of simple and complex solutions that are customized to respective manufacturers, we have helped FMCG brands revolutionize their warehousing practices globally by integrating digital technologies like:
- Voice-directed picking aimed at optimizing picking accuracy and efficiency;
- Warehouse control systems with real-time equipment monitoring dashboards that provide instant alerts and
- End-to-end agile solutions that offer total visibility into the entire warehouse process in real time and enable faster adaptation to dynamic demand fluctuations, decrease need for advanced order preparation and minimize intensive labor efforts
Intelligent automation is key to staying top of mind
Given the rapid spread of the omni-channel experience and continuation of physical restrictions, the next five years are likely to see widespread adoption of automation across industries which will yield long-term benefits beyond cost and labor optimization. It is only a matter of time before manufacturers realize the benefits of automation across the entire value chain from planning to execution and begin integrating it into their supply chain strategies.
Today’s consumer is extremely demanding and time conscious, and brands have to have speed and agility in delivery, efficiency in fulfillment and adaptability to their changing demands. In this scenario, intelligent automation that directly impacts distribution supply chain positively is critical to brands firmly staying in the homes of customers and in their shopping carts.