Swanson Health Improves Order Fulfillment Fitness with Varsity |
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Swanson Health Products is one of the largest privately held mail-order and Internet marketers of dietary supplements. The company ships more than 8,500 parcels of vitamins a day to residential addresses throughout the United States.
Swanson Health customers shop from the company's catalog and order over the phone or online. No matter how they choose to order, or how much they order, the shipping charge is always $4.95.
Not only does Swanson Health offer low cost shipping, they also provide an exceptional level of customer service. "The Web has changed customer expectations of shipping delivery time—shoppers want their shipment right away," remarks Terry Kraft, Director of Operations for Swanson Health. "We set a standard that our United States customers will receive their order within three to five business days."
Being the low-cost, high service provider can be a challenge. "You have to be organized, efficient and have the right software to support your business objectives," says Kraft.
In 2003, to meet increased shipping volumes and maintain a high level of customer service, Swanson Health undertook an extensive upgrade of their order processes. The upgrade included a new state-of-the-art pick-to-light and pick-to-box system, weight checking for automated quality control, and replacing their inadequate shipping software, which ran on the iSeries.
"Our business continued to evolve," notes Kraft, "but our shipping system couldn't keep up. It was like having a ball and chain locked to your ankle."
In researching a new shipping system, Swanson Health made sure to avoid the service and shipping error shortcomings of their prior system. Committed to the iSeries platform, the company investigated Varsity Logistics, the leader in shipping software for the iSeries. "We found that Varsity had a good reputation for service and accuracy as well as deep shipping functionality," said Kraft.
After installing Varsity ShipSoft to manage their multi-carrier shipments, and ShipAudit to audit carrier invoices, Swanson Health found that Varsity's reputation was well earned. "Varsity is bullet proof," notes Kraft. "And we've received outstanding customer support every time we needed help, on the phone, or in person."
In addition, Varsity ShipSoft has been able to support the company's growth from 5,500 parcels a day to more than 12,000 parcels on a peak day.
The company's new order process is almost entirely automatic. Information from the order entry system is transmitted to the distribution center where an invoice is printed and automatically applied to the box. Next, a pick-to-light system illuminates items to go in the box. Items are automatically scanned as they are added and shipping information is conveyed to ShipSoft. Each product SKU contains weight and volume details, which helps with order accuracy as the weight of boxed orders can be verified against the theoretical weight derived from individual SKUs. Any deviations, and the package moves to manual inspection.
Finally, the box barcode is read as it passes over an inline scale, where Varsity ShipSoft is updated with the final weight for manifest transmission. The shipping label prints and is automatically applied to the box, which is then automatically sorted by carrier and service type.
Swanson Health's high volume of shipments made carrier invoice auditing a necessity. With their old software, this was complex and frustrating. So Swanson Health also purchased Varsity ShipAudit. Now, they can audit a weekly carrier invoice within ninety minutes or less. ShipAudit compares shipping charges on the manifest against the carrier's invoice and flags discrepancies. These discrepancies can add up to thousands of dollars a month.
The upgrade project has been an overwhelming success. Swanson Health more than doubled the efficiency of their distribution center, and reduced the rate of inaccurate order from 16% to 0.6%. The return on investment was less than one year. "ShipSoft and ShipAudit play important parts in reaching our customer satisfaction goals," concludes Kraft. "From an operation standpoint, it has been a great marriage between our automation system and Varsity software."
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