What is Materials Handling in E-commerce?
Material handling is moving raw materials from their origin, involving them in manufacturing, and transferring finished goods from factories to their distribution centers.
In e-commerce platforms, materials handling is the process of receiving, storing, and distributing products that are ordered online. It also includes returns management, shipment tracking and delivery status.
Significance of Materials Handling in E-commerce
Materials handling plays a key role in increasing the efficiency of order fulfillment processes through a robust management strategy. The benefits of material handling include the following –
- Materials handling helps ensure that products are shipped on time, in the right quantity, and good condition.
- It also helps reduce shipping, handling, and inventory costs and improves customer satisfaction.
- Effective materials handling can improve customer service, increase overall efficiency, and reduce errors in order fulfillment.
Prerequisites to Calculate Materials Handling and How It Works
Prerequisites to calculate materials handling in e-commerce include the following:
1. Accurate inventory data: This includes the number of items in stock, the size, and the items’ weight.
2. Warehousing facilities: To allow efficient handling and organization of items.
3. Shipping and logistics: The cost of shipping and the time taken to deliver a product should be considered when calculating materials handling costs.
4. Automation: Automation can also help streamline the ordering process and reduce the time taken to process orders and store inventory.
5. Cost tracking: To allow accurate calculation of the total cost of materials handling.
Use Case With Materials Handling
Assume a company XYZ receives an order for 25 units of a particular product. They collect raw materials for the product and manufacture the final product. The operator places the product in the shipping container and it is transported to the customer on time. By streamlining the materials handling process, e-commerce businesses can improve their competitive advantage and create a more efficient customer experience.