Inaccurate picks are a significant problem for Warehouse Managers. Poor picking practices result in increases in returns, customer dissatisfaction, and costs to the company. However, the exact costs remain elusive, especially in supply chains that lack end-to-end visibility. Warehouse Managers may believe these costs are minimal, but let’s look at the true costs.

Inaccurate Picks May Seem Like a Minor Problem, But They Cost Much More Than Warehouse Managers Realize

Inaccurate picks translate into additional expenses for the company, tying up working capital, reports Insight Works. Think about it – an inaccurate pick could mean the computer believes that item is still held in inventory. For automated reordering systems, the system may not recognize a replenishment threshold. As a result, a consumer orders more product, and the order is then identified as on backorder. It destroys the customer’s experience.

Inaccurate picks also involve shipping and handling costs on returns, shipping costs to send the correct product, and time spent working with a consumer to resolve the issue. In addition, inaccurate picks lead to lost opportunity costs for reinvestment into the company. Capital simply cannot be used to support new initiatives, reducing profitability.

Better Pick Accuracy Holds Big Benefits

Accuracy in picking reduces risk, increases customer satisfaction, and saves money, according to SupplyChain24/7. That much is clear, but what Warehouse Managers overlook is its impact on future sales. A happy consumer experience includes the promise of free return shipping. Up to 67 percent of consumers check returns processes before completing a purchase. In other words, consumers are counting on the right product, at the right price, and delivered at the right time. Increasing accuracy in the first go-around and the potential profitability is even higher among high-price items. Approximately 27 percent of consumers will purchase an item over $1,000 if offered free returns, compared to 10 percent otherwise. But, the benefits do not end there.

Additional benefits include increased performance in the warehouse, which in turn will build rapport among team members. Fewer complaints and errors result in higher employee morale, decreasing staff turnover. This has the net effect of lowering overhead hiring expenses, enabling greater profitability.

How to Reduce the Incidence of Inaccurate Picks

The easiest way to reduce the prevalence of inaccurate picks is simple. Hold team members accountable when an error occurs and implement a multi-check process to ensure the order shipped is the order tendered. Also, eliminate manual processes where possible. This includes using robotics, handheld scanners, barcodes, RFID tags, and AIDC technologies.

Integrate Your Systems to Decrease Inaccurate Pick Frequency Now

Although inaccurate picks may seem easy to avoid, they are responsible for a significant decrease in customer satisfaction and an increase in warehouse costs. Fortunately, inaccurate picks are easy to address through integrated systems and expert guidance, such as that offered by a third-party integrator, like Veridian.

Veridian can help you realize your supply chain success. Fill out the contact information below in order to schedule a consultation call with one of our supply chain professionals.