Spotlight on NCOF: Slotting Software

May 01, 2007 9:30 PM  By

Welcome to our continuing series highlighting the speakers of the National Conference on Operations & Fulfillment (NCOF), which Multichannel Merchant presents with the Direct Marketing Association. At this year’s conference, scheduled for April 29-May 2, Ron Grove, vice president of facility design and material handling engineering for Long Grove, IL-based Tom Zosel Associates, was to speak about the importance of slotting software. Here, managing editor Mark Del Franco distills Grove’s thoughts on slotting software.

Slotting, or product profiling, is one principle that most managers can agree is important. Though it affects productivity, throughput, and order accuracy, not enough operators set aside the time needed for proper slotting — perhaps because it involves shutting down the distribution center.

There are two types of slotting: manual and software-based. If you deal with a diverse product mix or highly seasonable items, software-based slotting may be worth examining. Most operations selling more than 5,000 SKUs should be using slotting software as well.

Slotting programs live and die by data accuracy. Just as it is in front-end marketing, data cleanliness is a must. Be sure the documents are verified and accurate. For instance, if the weight of a given item is off because the decimal point is incorrect, that could lead to your putting a heavy, bulky item in an ergonomically dangerous location.

To ensure the best results, you must be prepared to measure case dimensions and quantities for each category. Be sure to capture the weight of each product as well as add other special instructions that go along with the SKU listing.

Be prepared to do some manual intervention when you’re using the slotting software. You can expect to override about 2% of your products. These could take the form of oddly shaped SKUs, such as a long broom handle, or inaccuracies because of bad data.

Though it may be integrated within your warehouse management system, software-based slotting can cost about $150,000 for the licensing and configuration.