RDS™ Cartonization Software Increases Profitability Through Optimized Dim Weight Shipping

Jennifer Maloney
September 8, 2015

“One of our customers with an omni-channel distribution operation estimates that they will save over $300,000

“One of our customers with an omni-channel distribution operation estimates that they will save over $300,000 in shipping costs by using the latest version of RDS™ cartonization software”, states Dan Hanrahan, CEO of Numina Group.

Getting shipments to customers expeditiously and accurately at the lowest parcel and LTL shipment cost is mission critical in e-commerce and omni-channel distribution operations. Many companies have outdated or no true cartonization software in their order fulfillment process to determine optimal carton selection for pick and pack. Estimating instead of calculation cube will miss the opportunity to determine “least cost” order shipping method.

Cartonization is more critical today due to dimensional weight rates now in-place from major parcel carriers. Companies are getting slammed with after order shipment additional dim weight charges. Without cartonization, operators will select and pack orders into larger than necessary shipping cartons. This adds up to unused space, additional void fill costs, and higher shipping costs. Basic fluid modeling cartonization software does help to gain some measure of cost control, but there is room for considerable improvement. The answer is to utilize a more advanced modeling algorithm for determining order cartonization.

Fluid Model Cartonization

Most cartonization is accomplished using a fluid model, which simply adds up the volumes of the items and compares the sum to the total volume of the order items to a set of available shipping cartons. The problem with fluid model based cartonization software is that it typically requires specific rules for some SKUs, so it requires higher software support and customization to produce reasonable resultsIt also requires a fill ratio setting that leaves 10% to 15% of the carton space open. Setting the fill ratio too high will increase the number of cartonization errors and lead to expensive exception errors and manually re-packing cartons in the pack process.

Bin Modeling Cartonization

A better option is the bin modeling algorithm, which Numina has used to develop its new cartonization software. Unlike fluid models, the bin modeling algorithm only produces SKU selections that can truly fit into the selected carton size. Also, unlike fluid models, the algorithm can much more closely achieve 100% fill ratios when presented with SKUs and matching carton sizes. The software can be configured to perform cartonization over any set of available containers, each with its own weight and item count limit, if desired. The algorithm will optimize the total number and size of cartons to minimize shipping costs. These features represent significant enhancements over traditional cartonization software that will enable our customers to pack orders much more efficiently and ensure they’re being shipped for the lowest possible cost.

Two-Point Deployment Yields Greatest Results

Companies can derive the greatest ROI by improving carton selection with cartonization software at two points: 1) Prior to order release at the start of the picking process, and 2) Adding technology after the pick and pack process to verify the order weight and dimensions being shipped. This technology measures each carton’s actual weight and dimension to validate the shipment.

1. Order Release: Select the Right Carton Upfront

One important way to reduce costs and increase efficiency is to eliminate redundant touches by reducing the quantity of orders picked to totes and subsequently re-packing them in their final shipping carton. The leanest pick method for e-commerce and split case order picking is pick direct to the carton.

Numina’s new cartonization software makes this picking process more accurate. Before order release, the software must analyze the order SKU cube and weight to perform the “best fit” shipping carton or group of cartons before picking begins. The more accurate the software, the lower the carton repacking labor, void fill and shipping costs. One of Numina’s customers with an omni-channel distribution operation estimates that they will save over $300,000 in shipping costs through new model based binning cartonization.

2. Pack and Ship – Order Validation

With the right software and scan-weigh dimensional measurement technology (SWD) in place you now have the tools to pick directly to the carton. Multi-modal voice picking will further enhance the pick to carton process. Voice allows hands-free barcode scan of the carton selection, SKU, item count and pack process. A voice command can be used at completion of the last item picked to inspect and verify that the carton matches the order size requirement. After picking, cartons travel to the packing area where document printing/ insertion takes place, void fill is added and the cartons are taped. The cartons exit the packing area on a conveyor line and travel to shipping.

In the shipping area the expected carton size and weight is verified using an in-line SWD system. This technology adds additional dividends by real-time checking of the outbound carton/case shipments, essentially re-checking and catching any discrepancy such as an open flap. Dimensional weight inspection can catch SKU weight and size changes to correct SKU packaging size, allowing an inspector to update the SKU cube and weight data. By measuring the actual dimensions and weight, the “best way” shipping method can be selected for the order, and accurate shipping charges can be determined pre-shipment to avoid expensive charge backs or lost revenue.

Using weight and dimensional data integrated with the order fulfillment system enables a real-time order inspection tool and dimensional weight measurement for more accurate LTL and parcel shipping. Numina Group is one of a handful of technology integrators that offers both cartonization software for pick to carton and the SWD carton cube/weight measurement that combines real-time control and conveyor sorting decisions. Used together, cartonization and SWD technology integrated to WMS-WCS Systems improve accuracy, reduce labor and shipping costs in existing or new DC operations.

Pick Validation and Preventing Shipping Errors

Companies that ship a high percentage of full case SKUs will also benefit through SWD if the software managing the system includes a “learn mode” to on-line capture and learn full case SKU cube and weight. This eliminates the labor-intensive tasks of manually collecting dimensional weight data for full cases. The software provides dimensional weight learning of full case dimensional weight, and additionally inspects cases prior to shipping, robotic pallet build, and/or manual or pallet build operation.

Once the case SKU characteristics are learned, the software performs pick validation and will catch miss-picks and irregularities, such as an open flap or damaged carton, improving quality and diverting damaged cartons to QC for corrective actions.

This data can also be used to manage print and apply labeling of carrier or retail compliance shipping labels and to improve other DC operations, such as staging and storage space planning and cubing trailers for LTL or full truck shipments. Real-time dimensional weigh data ensures customer satisfaction through accurate and verifiable order shipments. The storage and cube utilization of a warehouse, the sizing of future facilities, and the selection of the best mode of transportation are all are optimized with in-line dimensional weight measurement.

If you’re interested in identifying cost savings through the combination of cartonization and SWD, we’d love to talk. To arrange a free consultation please contact Pat Hanrahan at 630-343-2629 or email us at sales@numinagroup.com