3PL : A Simple Sortation Solution for a Health & Beauty Retailer

This “blast from the past” brings to light a PSI installation from a few years ago where a simple installation of the modular OTUs helped a 3PL keep up with peak demand on top of a direct mail campaign. Several years later, the 3PL has been able to scale up the pack station output to meet growing online shopping demands without major upgrades to the sortation process.

The Situation:

Several years ago, PSI worked with a 3PL who had been contracted to warehouse inventory and fulfill orders for a beauty and health product retailer. The average order volume was 100,000 packages per day during regular season and double that amount during peak season, which occurred twice per year. The 3PL used a combination of automatic and semi-automatic pack stations to pack, label, and seal orders before sending the ready-to-ship boxes down the line to a manual sortation station.

The operators would manually go through parcels of varying sizes and meticulously pack the large shipping crates to maximize space and the number of orders sent out per crate. The manual sortation process was unable to keep up with daily order volume and on top of that, there was a high rate of error where a parcel would be packed into the wrong crate. If the operators do not catch these errors, the distribution center then must rectify the order, which added up to a significant cost.

The retailer prides itself on being “customer focused” and developed a mailer envelope program to send samples to customers whose profiles match the featured sample products. 10,000 sample mailer envelopes per day were to be sent out, adding even more volume to a sortation process that is already over capacity.

The Recommendation:

Working closely with the 3PL, PSI designed a sortation system using Omnidirectional Transfer Units (OTUs) that scanned the barcode on each order and automatically sorted it to the proper lane based on the final destination while still allowing for manual packing into crates so they could maximize the space and reduce costs. Additionally, PSI installed a separate, smaller, sortation system off to the side that could focus entirely on the sample mailer envelopes but could easily be redirected to sort small packages if the main system was running at full capacity.

The Result:

Using OTUs, the installation of this sortation system was simple and non-disruptive. The 3PL staff identified breaks in the existing conveyors where PSI could install OTU blocks and divert the packages to the proper destinations based on geographic area. The end result was a more organized and efficient shipping area which made it easier for the carriers to pick up the orders and simplified the 3PL’s outgoing logistics process allowing them to increase the number of orders they shipped out every day.

The company confidently rolled out its new mailer envelope program knowing that their order fulfillment will not be impacted. The 3PL has enough capacity to keep up with regular demand on a single shift, with the ability to draw on the mailer envelope sortation area to support with small parcels during demand spikes.

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