Aug 12, 2021 | newsroom
Logistics and e-commerce company ShipHero next month plans to move into warehouse, roughly four times the size of its current facility at the Golden Triangle Logistics Center in North Las Vegas.
ShipHero Chief Executive Aaron Rubin said the move is happening just over a year after the company opened its first outpost in North Las Vegas.
“We (first) moved in July 1 of last year,” he said. “We basically ran out of space. We’re an e-commerce and logistics company so things are busy.”
The company currently occupies a 50,000-square-foot facility but will be moving into a 200,000-square-foot warehouse at the Golden Triangle, a 127-acre business park that’s still under construction.
Rubin said the company plans to add 100 employees over the next two years at the facility, which would bring its total workforce in the area to about 130 employees.
New York-based ShipHero helps small-to-large firms with e-commerce fulfillment needs as well as offers a cloud-based warehouse management software system.
Last year, it processed more than $5 billion in orders, and clients include Canadian Tire and Universal Music Group.
It also closed $50 million in funding led by Riverwood Capital in June, marking its first institutional investment.
Rubin said expanding ShipHero’s warehouse network to include Las Vegas made sense.
“Vegas has good proximity to Southern and Central California (and) it’s a good workforce,” he said.
Read more at the Las Vegas Review Journal
Aug 13, 2021 | Blog, Warehouse Operations
What is a perpetual inventory system?
By: Aaron Rubin, Founder & CEO of ShipHero
Physical inventory counts are an extreme time sink. Employees have to walk around and manually count inventory levels to double-check inventory records. Not only are these physical counts a time-consuming way to track inventory, but they can also be inaccurate due to human error.
Periodic inventory systems that use this manual inventory management system are slowly phasing out to be replaced by more up-to-date processes that are less prone to error. Modern inventory systems save time for employees, so they don’t have to count items in storage bins when they have more vital work to do.
A system that has gained popularity as technology has advanced is called perpetual inventory accounting. Perpetual systems are technology-driven solutions that allow for your different software platforms to share information with each other. Companies that take advantage of this new, interconnected system can benefit from things like real-time data, point of sale (POS) integration, more accurate inventory balances, and significant amounts of saved time for employees.
Perpetual inventory systems work by tracking inventory directly through your point of sale software and inventory management software. By leveraging things such as barcode scanners and transaction data, the system automatically tracks stock and inventory items as they are acquired in the warehouse or sold. You can still hold inventory counts, but only to account for potential damages to inventory or theft, not to track your entire inventory system.
Advantages of a perpetual inventory system
There are a handful of excellent advantages to a perpetual system. Due to its automatic nature, as soon as the merchandise is sold or acquired, your COGS account (Cost of Goods Sold) is immediately updated. Through real-time database updates, accounts payable and accounts receivable can instantly and accurately report and analyze inventory and sale data. Perpetual systems also leave a paper trail for all received shipments and purchases, helping with audits and fraud prevention.
Manual counting of inventory numbers isn’t used in perpetual systems to the same extent as other systems. Implementing a perpetual sale system that automatically sends inventory data to a central database saves your employees time and your company money. Automatic systems also cut out human error, saving you money on poorly managed and miscounted inventory.
Disadvantages of a perpetual inventory system
The barrier to entry for perpetual inventory systems is their initial cost. Purchasing all the needed items such as the perpetual inventory software, RFID or barcode scanners, and other additional hardware has a high average cost for companies.
Costs for training are also a consideration when considering the initial investment into a new perpetual system. While you can recoup initial costs in the form of wage savings and inventory management savings, the initial investment may still be too much to justify depending on your stock turnover and inventory.
What is the FIFO perpetual inventory method?
First-in, first-out (FIFO) processes act as if the first item you received will be the first item sold. In FIFO perpetual methods, the FIFO standards are assumed within the software, indicating that the most recent costs of purchased merchandise are the first to be charged against revenue. Perpetual FIFO is extremely common and often reflects the proper flow of goods through a company.
What is the LIFO perpetual inventory method?
Last-in, first-out (LIFO) processes assume that the last unit you receive will be the first unit that you sell. Opposite the FIFO method, the last cost of merchandise is what you charge against your company’s revenue. Often this method is used for specific accounting purposes, such as tax breaks.
How does a perpetual inventory system differ from a periodic system?
Unlike the automatically driven perpetual systems, periodic systems rely on occasional physical inventory counts to keep track of stock and COGS. Periodic systems require significantly more manual involvement in inventory tracking and data updates. There are a few key advantages to consider for automatic perpetual systems:
Keep up with data in real-time
Perpetual systems use technology to update inventory data immediately as items are sold and transferred. Instant inventory updates mean that your teams can perform up-to-date analytics at any time while having faith that their inventory numbers are close to accurate. Real-time updates also empower your team to create more consistent, accurate reporting to keep an eye on product and sales performance.
Leave a paper trail
Due to tracking all inventory movements through digital software, you leave a reliable trail of data. Paper trails allow for easier audit compliance, fraud detection, and more accurate insights. Tracking can also help you get an overall view of your supply chain, helping you find areas where you can improve your practices.
Lower inventory management costs
Perpetual systems are a considerable investment upfront; however, they will lead to lower inventory management costs over time. Manual systems such as inventory counting are needed significantly less often or not at all. Real-time analytics means that you can prevent things like holding costs as well, saving you money.
Easily investigate stock level discrepancies
Since perpetual systems are constantly updating, you can more quickly see discrepancies in stock data. You can detect things like theft, damaged goods, and fraud through missing stock and inventory. Finding stock discrepancies faster can help give insight into issues that may become much larger if left unhandled, such as store security issues.
Leverage demand forecasting to grow your business
Keeping accurate and up-to-date stock information helps you forecast demand. Through reliable analytics and historically tracked inventory data, you can detect trends in your demand and make changes to your purchasing practices accordingly. Preventing running out of inventory during high-demand seasons like the holidays can help your company’s profits significantly.
When to use a perpetual inventory system
Not all companies require a fully-fledged perpetual inventory system, especially if they have small amounts of stock with little variety. There are specific places in which perpetual inventory systems do shine, including businesses with high inventory turnover or quickly growing companies.
Your business is growing rapidly
When your business is growing very quickly, implementing a perpetual inventory system can help track your new and growing stock. By implementing a perpetual system as things start growing for your company, you can keep a paper trail to track and project continued growth. Deciding to add a perpetual system set up to your company sooner rather than later can also mean saving future training and rollover costs.
You have dozens of SKUs
Dozens and dozens of SKUs are hard to track, especially when you have to go through and correctly note them manually. More SKUs mean more potential for human error and longer hours to try and track inventory data. Perpetual systems don’t struggle no matter how many SKUs you have, making them a great option if you have a large inventory variety. For example, grocery stores almost always use perpetual systems to track all of their various products.
Inventory turnover is high
Slow, manual counts don’t often cut it for analytics and tracking when your company has exceptionally high inventory turnover. It is harder to track trends and demand when your inventory moves quickly, so a real-time system is crucial for accurate data collection.
When stock is turning over fast in your company, it also can lead to lost inventory. A perpetual system helps keep precise data tracking and prevents things like theft.
Formulas in perpetual inventory
There are a few crucial formulas used within perpetual inventory systems. Cost of goods sold (COGS) and gross profit formulas help make sense of your data and give your company data for future business decisions.
The Cost of Goods Sold (COGS)
You can calculate the cost of goods sold (COGS) first by adding your beginning purchases and inventory, which is the cost of goods available for sale. Next, you will find the ending inventory and subtract that from your initial numbers. These numbers are tracked easily and automatically in a perpetual inventory, which means you can pull a continually updated COGS report.
Beginning Inventory + Purchases – Ending inventory = COGS
Gross profit
The gross profit is your actual profits after subtracting how much your operating expenses cost you during a period. To find this number, all you have to do is subtract your COGS from your total revenue.
Revenue – COGS = Gross Profit
Conclusion
Perpetual inventory systems can be an investment to implement, but they have many strengths over periodic systems. While periodic inventory systems can be suitable for companies with lower turnover or less product variety, perpetual inventory systems can provide significant advantages to companies that make many sales or have a broader range of product lines.
Manual tracking used in period systems takes time and is prone to human error. Perpetual systems track your inventory data in real-time, allowing your team to make faster reports, more accurate analytics, and save time in manual counting by leveraging technology. While the initial investment may seem daunting, the long-term profits seen from saved money in areas like inventory management make perpetual systems an excellent move for many growing companies.
Schedule a meeting today with our experts to learn more about our WMS software built for ecommerce brands & 3PLs looking to run their best warehouse and how ShipHero works to ensure that organizations invest in the solutions that match their needs, to improve productivity, revenue, and success.
Click HERE to Schedule a Meeting Today
Aaron Rubin, Founder & CEO
ShipHero
About the author: Aaron Rubin is the Founder & CEO of ShipHero. He is responsible for planning and executing the overall vision and strategy of the organization. Rubin’s greatest strengths are leadership, change management, strategic planning and a passion for progression. He is known for having his finger on the pulse of ShipHero’s major initiatives, his entrepreneurial spirit, and keen business acumen. His leadership of ShipHero is grounded in providing excellent customer service that drives improved business operations. His passion for ShipHero comes from the culture and his ability to have an impact on the lives of employees, customers, partners, and investors.
Follow Aaron on Twitter & LinkedIn.
Aug 16, 2021 | newsroom
Distributed fulfillment means utilizing a nationwide or global network of warehouses and fulfillment centers to bring inventory closer to potential customers, as opposed to shipping from one to two centralized locations. While this supply chain model creates more complexity and room for error, tech companies have come to the rescue with powerful software that integrates virtually every aspect of getting a product from the online store to te customer’s door.
Companies have found enormous success using predictive analytics and machine learning. These tools intelligently allocate inventory across networks to avoid stock-outs, reduce miles traveled, and decrease delivery time, cost, and environmental impact.
To understand the power of a distributed fulfillment network, consider that distributed fulfillment services can prioritize ground transportation and achieve a two-day shipping standard anywhere in the United States. That’s receiving an order, picking, packing, and shipping using trucks, cars, bikes, or scooters anywhere within 3.797 million square miles…in less than 48 hours.
As shoppers slowly regress to in-person shopping habits, retailers have taken the opportunity to roll their customer-facing storefronts into this distributed fulfillment network, creating a hybrid model for traditional brick-and-mortar stores. The front end handles in-person shopping, while the back end receives and handles online orders from nearby customers.
Read more at Inbound Logistics
Sep 10, 2021 | Blog, Warehouse Management Software
By: Aaron Rubin, Founder & CEO of ShipHero
The definition of the prefix omni – is all, whereas the definition of multi – is many. So, how do you enhance your eCommerce business, marketing, sales and fulfillment to encompass everything, not just a lot of things? Since this is the future of eCommerce retail, it’s imperative that you and your organization figure it out.
Moving from a multichannel approach to omnichannel hinges primarily on how you think about your customers and their buying journey. Instead of selling and marketing to your customers via different channels – online, in-store, mobile – you’ll have to start thinking more globally. Let’s examine how this works.
Your Customer Journey Should Be Cohesive
Customers expect a unified customer experience. This means that if they visit one of your brick-and-mortar locations, they want it to look and feel like visiting your website, scrolling through your social media accounts or using your mobile app. It’s about making the experience as seamless as possible. This also ties back to buy online, pick-up in-store (BOPIS), curbside pick-up and DTC.
Target and Kohl’s are great examples of how to make omnichannel work. Both retailers have mobile apps that allow consumers to search for products in their local store or across all their stores; order directly from the app; order and pickup in store; and use their app-based wallet to keep track of all specials, coupons and payment methods. Additionally, both of these retailers leverage their in-store inventory to fulfill orders if the product is not available in the warehouse.
To the customer, this is a seamless and integrated experience. Now, you may not have the footprint of a store like Target, but your warehouses and stores can still be leveraged together to offer the consumer the best experience and make the buying journey more enjoyable.
The Four Basic Tenets of Omnichannel eCommerce
To enhance the effectiveness of your omnichannel-centered tech, you also want to be sure you’re addressing each of the four essential keys to Omnichannel eCommerce: sales channels, marketing and advertising, operations and shipping and fulfillment.
Your operations and fulfillment processes will fall flat without a strong sales funnel powered by the right marketing and advertising plan. These are the “first four” aspects of your business that must work together to get the kind of omnichannel eCommerce results you want.
The Right Technology is Your Best Investment
Now, to complete all of these tasks as outlined above, there is one particular tool you need – technology. And instead of just one or two pieces of tech, you’re going to need to make sure that your entire platform and its infrastructure are built to handle omnichannel eCommerce and enhance your success.
Three Keys to Omnichannel Tech Infrastructure
- Headless Commerce: Quite simply, headless commerce means that neither your front-end systems (POS, customer interface) or your backend systems (inventory/order management) are leading the way. Instead – your front and back-end act independently of each other. Why does this matter? It’s a more flexible way to manage your eCommerce business and allows you to make changes easier than ever. This can include upgrading certain features or adding new options all together.
- Customer Data: In order to provide a seamless and customizable customer experience, gathering, analyzing and using data of your customers’ behaviors is imperative. Customer Data Platforms (CDPs) can help you gather data from different sources like your website, social channels and mobile to bring everything together to create cohesive customer profiles. This data can then inform your omnichannel strategy as you strive to provide the best customer experience backed by actual data.
- Omnichannel Marketing: Marketing to different consumers on different platforms is only a part of what omnichannel marketing really is; the true magic happens when you can target different messaging to customers depending on how they choose to engage with your brand. While your customers share many similar traits, they’re not all the same. The message you serve to Instagram is more than likely not the same message that will work on TikTok.
In all of the instances above, having a flexible and well-appointed infrastructure will make it much easier for you and your team to manage an omnichannel approach.
Partner With Experts
The best news about omnichannel eCommerce is that it’s not a road you have to navigate alone. Warehouse management systems, shipping and fulfillment providers, as well as customer data platforms all work together to help you build the best omnichannel strategy for your business. Find the right omnichannel partner and you’ve already taken a step further than many of your competitors.
Schedule a meeting today with our experts to learn more about our warehouse management software built for ecommerce brands & 3PLs looking to run their best warehouse and how ShipHero works to ensure that organizations invest in the solutions that match their needs, to improve productivity, revenue and success.
Click HERE to Schedule a Meeting Today
Aaron Rubin, Founder & CEO
ShipHero
About the author: Aaron Rubin is the Founder & CEO of ShipHero. He is responsible for planning and executing the overall vision and strategy of the organization. Rubin’s greatest strengths are leadership, change management, strategic planning and a passion for progression. He is known for having his finger on the pulse of ShipHero’s major initiatives, his entrepreneurial spirit, and keen business acumen. His leadership of ShipHero is grounded in providing excellent customer service that drives improved business operations. His passion for ShipHero comes from the culture and his ability to have an impact on the lives of employees, customers, partners, and investors.
Follow Aaron on Twitter & LinkedIn.
Sep 17, 2021 | Best Practices, Blog, Warehouse Management Software
By: Aaron Rubin, Founder & CEO of ShipHero
It’s hard to look at the 2021 holiday season without seeing the cloud cast over it by COVID. While there had been some hope just a few months ago that life might go back to “normal” by this holiday, the chances are there will still be daily challenges to living a normal life.
This means your customers are going to keep many of the shopping habits they adopted in 2020. Taking those lessons (read our blog about this topic HERE) into 2021 has given eCommerce retailers a solid framework for how to think about Black Friday Cyber Monday and the holiday season in general when it comes to planning and preparing.
However, what are five concrete things you can do to incorporate recent changes and capitalize on them? Let’s review some tactics you can make into actionable goals to help propel your holiday 2021 sales upward.
Preparing for the Holiday Season
Aside from the regular prepping you would do for the holidays (hiring more employees, ordering more packing materials, checking for carrier surcharges, etc.), here are five ways you can specifically prepare that you might not have thought of.
Maximize your Social Channels
People use their mobile devices to not only shop for themselves, but to browse for gifts for friends and family. According to a study done by AdWeek, 45% of holiday shoppers last season stated that they discovered a product or gift via social media. Also, it is estimated that social eCommerce will account for 11% of all retail eCommerce next year, which adds up to $474 million.
Obviously, with numbers like these, it’s easy to see how your social channels can be lucrative. Make sure you’ve done your due diligence in regards to retargeting, keyword research and creative. If there was ever a time during the year to take extra steps with your social media strategy, it’s definitely the next 4-5 months. You also have enough time to do some testing of keywords and retargeting in August and September, before you commit your full holiday social media spend.
Build Brand Awareness
It’s estimated that when shoppers begin their shopping search online, only about 4% of them are actually ready to buy. And in 2019 online shopping cart abandonment was measured at almost 70%. This means that remarketing and following up on abandoned carts could become a key holiday season strategy.
Being top-of-mind is the quickest way for customers to discover you. You’ll want to run brand awareness campaigns starting as soon as possible (which can also tie into your social media strategy) and keep those ads running through Q4. Following up with these same shoppers if they leave behind full, but abandoned shopping carts is another key strategy. And you don’t necessarily have to send a discount code to entice them to finish their purchase. Sometimes, just a friendly “you forgot to check out” will net you the sale.
Plan for Earlier and Longer Promotions
Last year, more than 40% of shoppers stated that they started shopping earlier for the holidays than the year before. So far, there’s been no evidence to contradict this behavior. Black Friday Cyber Monday (BFCM) has even expanded to Cyber 5 to include Thanksgiving as one of the main holiday shopping mainstays.
Early shoppers will be looking for helpful tools like gift guides, promotional offers and personalized recommendations very soon. Start working on this content now and make sure your team is aligned on timing and goals.
On the flip side of this coin is the management of your returns process. Make sure that you have a strong and easy-to-understand returns policy and that it is well-communicated before, during and after purchase, especially if you have different policies for items purchased on sale or promotion.
Expand Your Payment Options
A proliferation of “buy now, pay later” payment vendors have flooded the market in the past 18-24 months. If you haven’t yet partnered with one of these vendors, it might be time to do so. Even Apple Pay recently entered the mix with their Apple Pay Later functionality. It’s also been shown that having a diverse range of payment options lowers cart abandonment. Find out how feasible it would be to expand your payment options on your site.
Address Supply Chain Strain Early
Take a look at your big sellers for this year, as well as predictions for holiday 2021, and talk to suppliers now about stocking up on these products. Remember that supply chain issues are still plaguing the industry. Also, examine ways that you can leverage your warehouses and in-store inventories to fill orders faster even as people start shopping earlier and earlier.
You more than likely have been speaking with your suppliers throughout this unprecedented time, but it might be a good idea to spend a few extra minutes getting a feel for what they are experiencing in their day-to-day business. Having as much information and forewarning as you can will go a long way toward making you more prepared.
The Holidays Don’t Stop for Anybody
While death and taxes are a fact of life, so is the holiday season. Make sure you’re leveraging all of your institutional knowledge, past experiences and eCommerce expertise to prepare – maybe even over prepare – for the holidays. Follow these steps and you’ll be on the road to more eCommerce success.
Schedule a meeting today with our experts to learn more about our warehouse management software built for ecommerce brands & 3PLs looking to run their best warehouse and how ShipHero works to ensure that organizations invest in the solutions that match their needs, to improve productivity, revenue and success.
Click HERE to Schedule a Meeting Today
Aaron Rubin, Founder & CEO
ShipHero
About the author: Aaron Rubin is the Founder & CEO of ShipHero. He is responsible for planning and executing the overall vision and strategy of the organization. Rubin’s greatest strengths are leadership, change management, strategic planning and a passion for progression. He is known for having his finger on the pulse of ShipHero’s major initiatives, his entrepreneurial spirit, and keen business acumen. His leadership of ShipHero is grounded in providing excellent customer service that drives improved business operations. His passion for ShipHero comes from the culture and his ability to have an impact on the lives of employees, customers, partners, and investors.
Follow Aaron on Twitter & LinkedIn.
Sep 23, 2021 | newsroom
Facing the swiftly approaching holiday season, companies are throwing massive job events, touting pay hikes, and embracing the gig economy to staff up in critical supply chain roles.
Read more at Business Insider
Sep 23, 2021 | newsroom
We are entering the most important months of the year for small businesses and online sellers as we head into holiday shopping season.
With the Covid pandemic impacting logistics and shipping operations last year, especially around Cyber Monday and Black Friday and leading into December, many buyers and sellers complained about late packages.
Multiple circumstances all came together to cause the COVID pandemic to adversely impact deliveries during the 2020 holiday season. It could be argued that it was a perfect storm of conditions.
Read more at eSeller365
Sep 29, 2021 | newsroom
Port congestion, capacity constraints and fluctuating transportation prices are putting increasing stress on supply chains. As we enter peak season, these issues are unlikely to go away.
Experts have mixed opinions about whether sustainability remains a focus during peak season stress, but they agree on one thing: Capacity is king.
Read more at FreightWaves
Sep 29, 2021 | newsroom
Real-Time Shipment Tracking and Shipping Carrier Updating For Fulfillment Clients
ShipHero is proud to announce a new set of features now available to all of its Fulfillment clients. PostHero is a post-shipment dashboard and data visualization tool that gives ShipHero Fulfillment clients the data they need to make informed decisions about their shipping performance and carriers.
With PostHero, ShipHero Fulfillment clients will be able to:
- Track Packages Across Carriers
- Identify Growth Opportunities in Shipping
- Recognize and Address Fulfillment Gaps
PostHero provides insight by giving clients the tools they need to truly understand their fulfillment process, even after the package has left their facility.
With this data, Fulfillment clients can analyze how certain carriers perform, what average transit times are and what changes, if any, they should make to optimize their revenue and increase customer satisfaction.
“We’re very happy to incorporate PostHero directly into ShipHero for Fulfillment,” Aaron Rubin, ShipHero’s Founder and CEO said. “This will give our Fulfillment clients a chance to really understand and control their shipping times and carrier distribution. Once you have the data – How long does it take? Who ships faster? – you’re able to make better decisions that maximize revenue. And of course, increase customer satisfaction.”
Now more than ever customers want to know where their packages are at all times. With PostHero, this ability is now in Fulfillment clients’ hands. A planned integration with Klaviyo and PostScript will be coming soon that will enable these shipment updates to be sent directly to consumers. This is the type of transparency that is expected of online retailers today and in the future.
“Once the 3rd party integration launches, we don’t see any reasons customers won’t want access to these features. We’re so glad that PostHero is immediately available for our Fulfillment customers. We’re working hard to also roll this out to our software clients too. We really feel it brings value,” Rubin stated.
ShipHero premiered PostHero after sunsetting an app called ShipScore that was part of the Shopify App store. PostHero provides all of the same functionality, but now it’s completely integrated with ShipHero for Fulfillment. To learn more about the superpowers of PostHero, click HERE.
About ShipHero
ShipHero is a US based, leading provider of cloud-based eCommerce fulfillment solutions that gives online retailers and third-party logistics providers the tools to ship more efficiently anywhere in the world. With more than 5,000 customers located around the globe, ShipHero offers online retailers a suite of services ranging from warehouse management software to outsourced fulfillment as a service. Some notable customers include Mars, Universal Music Group and Canadian Tire. Additionally, ShipHero is the official fulfillment network partner for Shopify, and is rapidly scaling a network of warehouses throughout the US to meet the growing demands of today’s online retailers.
Oct 6, 2021 | newsroom
Retailers struggle to stock shelves for holidays amid port congestion, shipping delays.
Congestion at ports in the United States as well as Asia is causing major shipping delays and leaving retailers “desperate to get their goods to physical and virtual store shelves for the holiday season,” according to Eric Kulisch, FreightWaves’ air cargo editor.
Shippers are shifting cargo from oceans to air transportation to avoid delays. But this expensive ocean-to-air shift has ripple effects, including environmental ones. Moving freight via ocean vessel is much more efficient in terms of greenhouse gas emissions than moving it via aircraft.
Read more at FreightWaves
