E-fulfillment Race Tightens for Firms

Dot Deliver LLC, an integrated logistics service provider in Grandview, Mo., is the latest company trying to crack Northwest Arkansas’ e-fulfillment market.

According to the trade publication Packaging World, the packaging industry’s e-fulfillment sector worldwide is expected to approach $60 billion in revenue this year.

Already, Mercari Technologies Inc. of Fayetteville and publicly traded Delta Systems Inc. of Bentonville have developed software and automation controls that enhance supply chain, or e-fulfillment, management via the Internet. The technology is important to retailers like Wal-Mart Stores Inc. because they rely on quickly restocked shelves to move merchandise.

But Dot Deliver is leveraging a slightly different value-added service for drug stores and mass merchandisers. The company, which transformed in 2000 from gift giant House of Loyd’s old fulfillment division into Dot Deliver, has created an inventory management saver it calls Robo-Pic.

The invention is an automated pick-and-pack system designed to efficiently handle split-case replenishment for retail and drug stores. It uses next generation Internet technology in the form of an e-commerce platform set up by industry stalwart Yantra Corp. of Tewksbury, Md.

Robo-Pic’s computerized machinery relies on a conveyer belt that moves collection trays past electronic product dispensers. A practical application might be breaking down a pallet of Revlon lipsticks into totes that then would be sent to individual store locations.

Typically, a Kmart, Walgreens or Wal-Mart receives a whole pallet of cases containing a product like lipsticks. The pallets are generally broken down by hand, and individual cases are sent out to the floor for stockers to refill shelves.

Dot Deliver would receive the pallets directly from manufacturers. Then Robo-Pic would do the separations into floor-ready packages tailored for specific store needs. The system, coordinating with an electronic plan of a store’s shelves, can code a tote package for a given aisle in a given store. That way, stockers can pick up a tote for their department, scan its coding, walk right to the shelf that needs refilling, open the package and have exactly the items needed for optimum replenishment.

It cuts down on both the labor of sorting whole pallets and stockers’ time spent breaking down cases on the store floor and then returning unneeded items to a warehouse. It also eliminates mis-picks or human mistakes and mitigates the risk of worker injury.

The system is not really for fast-moving items that need daily replenishment. Products like lipsticks, bottles of vitamins, finger nail clippers, etc., that typically aren’t fast-moving are the primary targets for Dot Deliver.

“Robo-Pic gets the right merchandise on the right shelf at the right time and eliminates out-of-stock problems,” said Will Johnson, Dot Deliver’s vice-president of business development. “It will help retailers improve their sales per square inch.”

Yantra’s portal allows Dot Deliver customers to monitor inventory “real time” throughout the entire ordering and delivery process.

Johnson said Dot Deliver already has eight Robo-Pic machines in operation, each one of which can fill 7,000 replenishment orders per eight-hour shift. The firm has two 800,000-SF facilities in Kansas City, of which Grandview is a suburb.

Johnson joined Dot Deliver in January after serving for 11 years as J.B. Hunt Transport Services Inc.’s vice president of business development for dedicated contract services. He wouldn’t disclose financials for Dot Deliver, which employs 300 people. But Johnson did say SG Capital Partners of New York provided funding for the firm.