The Rise Of Subscription Commerce: What Warehouses Need To Know

By Kirk Anderson, Executive Vice President, Snapfulfil North America

Ever since Amazon transformed two-day shipping into a basic offering, other retailers have looked to new and exciting business models to keep up with the competition.

And as consumer demand has turned toward automation, subscription commerce has grown exponentially – with page views on subscription commerce sites jumping nearly 3,000 percent between 2013 and 2016, according to the Huffington Post.

Today, retailers generally offer one of two flavors of subscription commerce: continuity or curation. Continuity models allow consumers to receive goods such as razors or dog food on a set schedule, often once a month, removing one more task from their to-do list. Curation models are geared more toward consumer taste; each month, customers receive a box of new (and at times unexpected) items focused on a specific type of good (i.e. clothing, sports memorabilia). With more than 2,000 U.S. subscription box services operating in 2016, according to Shorr Packaging, chances are high consumers will find a box that matches their needs or tastes.

While either model comes with unique challenges, with the right planning and technology, subscription commerce can be lucrative for retailers looking to offer something new and different. But regardless of model, if you’re considering a subscription commerce offering, start by streamlining your labor and inventory management processes.

Is Your Staff Ready For The Demands Of Subscription Commerce?

Shipping processes can vary wildly depending on the subscription commerce model you choose. Curation boxes often ship out to all customers on the same day of the month, creating a mini-peak season every four weeks followed by a period of downtime. Continuity boxes are structured separately for each customer; while some may receive a box at the same time each month, others may go two or even three months between boxes.

To help define a schedule for your warehouse, consider implementing warehouse management software that can help you plan for shipping peaks and valleys. Your technology will serve as a shipping calendar watchdog for you, giving insight into how your employees’ time can be budgeted most effectively.

Do You Have Your Inventory Under Control?

One of the curated model’s major draws is its personalization. Each customer receives different items based on their likes and dislikes, and often the unpackaging is part of the overall experience. In fact, “unboxing” videos have become a digital trend. When the box is scrutinized down to the packaging design, there’s little room for error – so paper-and-pencil inventory management leaves your business open to unnecessary risk.

For continuity models, varying customer ship dates mean your stock quantities are constantly shifting. While technology such as RF scanning provides a high-level view of inventory, more advanced software can track inventory ebbs and flows to determine customer buying patterns. You’ll save time and money when you stock more of your most popular SKUs and cut down on those that aren’t selling well.

A best-of-breed WMS can provide crucial support during both the inventory ordering and product packing processes. Rather than trying to keep track of each individual order, employ a system that can recall the required contents of any order in an instant. This will cut down on errors, speed up the packing process and, in the case of curation offerings, ensure your box is ready for its YouTube close-up.

What’s The Next Step?

Subscription commerce customers expect their product to arrive like clockwork – which means warehouse managers must make every effort to streamline processes and meet rigorous delivery schedules. Manual data entry and manipulation simply won’t cut it.

The right warehouse management technology will alleviate the more complex demands of a subscription offering – and it will grow with your business, adapting to your ever-changing needs without reconfiguration. If you want to be successful at subscription commerce, invest in software that empowers efficiency across the warehouse.