FragranceNet.com, an online retailer of discounted brand name fragrances, skincare, makeup, haircare, aromatherapy and candles, has hit the tipping point in regards to automating packaging. The company, which has doubled its sales annually for years, shipped over 30 million packages and sold more than $1 billion in beauty products since 1997.
Unfortunately, with such growth comes growing pains. Too often, the partially-automated fulfillment process left too many bins of picked items waiting to be processed. The problem was exacerbated each year from Black Friday through Christmas, when FragranceNet generated more than half of its annual income.
“I come from a corporate background [at a Fortune 50 company], where if we had a 2% sales increase, we flew to South Beach for a party,” says Hector Dilan, FragranceNet’s director of warehouse operations. “But, our e-commerce sales have doubled here every year since the day I was hired. Peak season shopping can result in up to 10 times the normal sales volume for many days in a row, which strains fulfillment capabilities. In just five weeks during the holidays, the company’s fulfillment operations recently had to work 16-hour days, seven days a week to meet the demand.”
The company had been employing a conventional packaging system that included manual labor. This involved having a checker manually place product in a box, adhere a shipping label and put it on a conveyor. Another team would add void fill to protect the product, and the box would be sealed with tape.
“With the conventional packaging system, we were paying people to make boxes, fill them, tape them up and put on labels,” says Dilan. “We needed a system that was faster and more automated.”
Graduating to high-volume automated packaging equipment
Given the rapid growth of e-commerce and dramatic spikes in order volume during the holidays, in 2015, FragranceNet invested in new automated packaging lanes. The conventional packaging lane would still be utilized for larger items and gift sets often sold in higher volumes during the holidays.
For its solution, FragranceNet.com turned to a compact, automated parcel packaging machine called ParcelPack by Systems Technology Inc. (STI), a manufacturer of automated packaging systems. The equipment can be used to package up to 20 orders per minute and can reduce labor.
In conjunction with the automated packaging system, the online retailer also uses a product called SecurePack, which protectively holds the contents of the shipment in place on an economical corrugate base pad using shrink or stretch film, without the use of void fill.
“There is no need to manually put items in a box because the box gets formed around the pad, and there is no need for void fill because we shrink wrap the items to the pad. So, the process helps us process our high-volume orders very quickly,” says Barbara Porter, FragranceNet.com’s chief technology officer.
FragranceNet implemented the automated packaging systems using two carton sizes. During most of the year, leading up to the holidays, the majority of sales are single items or several smaller items in a single package. So, FragranceNet utilized a small packaging size as well as a larger one. If needed, however, each line can be changed to adjust packaging size in as little as 10 minutes.
The picking system recognizes which lane should be utilized, small or large, based on the item(s) in the order, and takes into account whether the item might be sensitive to the heat in the shrinkwrap process.
At each automated lane, up to eight checkers can scan and place items for the order on the corrugated pad. The pad is then conveyed through the shrinkwrap heat tunnel and the box is formed around it using the ParcelPack equipment. The shipping label is printed and applied automatically, and the order and shipping label are verified.
“Speed was certainly what attracted us to the automated process,” says Porter. “We had to figure out how to solve the holiday backlog, which usually peaks for us on Cyber Monday every year.”
The packaging automation helps to streamline the fulfillment process not only during the holidays, but also throughout the year.
“Today, with Amazon shipping items out the same day, waiting two days to see order tracking is unacceptable,” says Porter. “So, our packaging line automation was needed to streamline the process to get shipments out faster.”
With the packaging automation supplementing its traditional packaging lines, Porter says that product is getting fulfilled and shipped much faster, so that FragranceNet.com is well positioned for continued growth and volume, even during the upcoming 2020 holiday season.