The cost of picking and shipping errors go far beyond returns processing. Here’s why.
As warehouses strive to produce “perfect orders” for their customers at a much higher velocity, the cost of an error has only increased. A worst-case scenario for a distribution center is for a mispick to occur and make its way through the delivery process. Mispicks and other inaccuracies not only disappoint customers and initiate costly return processes, they also produce a ripple effect that generates additional costs and erodes customer loyalty.
Mispicks occur when employees pick the wrong item, neglect to pick an item, pick the wrong quantity, or pick a damaged or mislabeled item for an order. According to this article in DC Velocity, human error is most often the culprit, but labeling errors introduced by the supplier or at receipt can also lead to mispicks.
These errors waste time and labor, can lead to expensive chargebacks, and damage the customer relationship. Receiving the wrong item can lead to missed deadlines or production issues for industrial customers, in addition to forcing them to deal with a return. On the consumer side, these picking/shipping errors can tarnish the company’s reputation with other potential customers.
"Service is now the big issue," says Steve Mulaik, an Atlanta-based director with global supply chain management consulting firm Crimson & Co. "[A mispick] can add two days to an order’s processing time. This is huge in the cut-throat e-commerce world. This sort of thing ends up in complaints on Facebook and elsewhere that drive [customers] to sites that have better service."