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By: Aaron Rubin, Founder & CEO at ShipHeroWhile seeing into the future of your supply chain may be impossible, predicting what may happen can be estimated by looking at the past. When a company wants to know how their finances, supply chain, and marketing may perform in the future, they often examine how things went in previous years.Historical business data can help you successfully estimate things like seasonal trends and product success. One of the processes for looking at this data in the supply chain world is called demand forecasting.
Demand forecasting is the practice of looking at a company's historical data for things such as finances, marketing, and supply to understand likely future trends. Demand forecasting methods end up within one of three categories, either qualitative forecasting, time-series analysis, or casual models. Forecasting can include looking at different lengths of time, using statistical methods, or looking at external influences on your future business.
Businesses use forecasting in many ways to help gain an advantage over the competition. From inventory and supply chain management to cash flow and spend, there are many areas where you can use demand forecasting within your planning.
When preparing your budget, demand forecasting helps you get a glimpse into your company's needs during an upcoming season or year. By knowing positive (and negative) trends, your business is better able to reduce risk and plan through data-backed decision-making. Whether it be inventory needs, staffing, or cash flow, you will be able to estimate your budget more accurately when forecasting.For example, in the ecommerce industry, the holiday shopping season is one of the busiest times of the year. Ecommerce merchants use past holiday shopping data to forecast how much inventory theyâll need for the holiday season.
One area that demand forecasting is extremely useful for is production management. Through analysis of your past seasonal demand, your company can better prepare for needed production before running out. Ramping up production only when needed means customers get items when they want them, and you don't have to put in guesswork and waste money by overproducing.
Warehouse stock needs can be hard to predict, which is why demand forecasting for inventory can help identify your future needs. Looking at inventory needs of the past and rising or falling demand trends, you can better gauge how much stock you will need throughout the year. Like production, having enough to continue providing services and goods is necessary, while having too much inventory can cost you unnecessary storage fees.
External and internal forecasting are two of the many ways to garner insight into the market and potential areas of business growth. Looking at the competition and trends in the historical market, you can better price your items advantageously in relation to rising and falling trends.
There are different types of demand forecasting methods, all using unique forecasting techniques and statistical methods to examine potential future demand. Understanding which demand forecasting you should use is vital to gauge possible trends and future customer demand accurately.
Passive forecasting is the most straightforward when looking for a basic, non-nuanced prediction. In this type of forecasting, you look at historical data from your sales in the past to estimate future sales. Unfortunately, this model doesn't take into account variables, such as retailers that will have seasonal fluctuations. Passive forecasting models often can only be accurately used for analytics with businesses that are highly steady in sales and have robust historical sales data.
The active demand model is most commonly used for businesses that are either very new or have aggressive growth within their marketing campaigns. Because your company may not have the past sales data to have accurate demand forecasts, active forecasting often looks at other resources such as market research, economic data, and supply chain management data.
In the short-term forecast method, insights such as seasonal demand, cyclical patterns, and other similar anomalies are included in the trend projection, making this a great way to examine your inventory management and supply chain. You can also use short-term forecasts to think about new products and their performance. The time span that the short-term method looks at is from three to 12 months.
Compared to short-term projections, long-term forecasting looks quite a bit further out from one to four years into the future. Rather than thinking about recent data sets and sales trends, future projections look at long-term demand, potential business decisions, business growth planning, and marketing planning.
When examining your companyâs goals, sometimes you will want to look at how outside forces may affect your forecast accuracy and sales channels. Whether you look at competitor and market trends or other outside factors, external macro forecasting can help you look at some complex factors that may affect your goals. Using external forecasting is excellent if you have concerns about your supply chain, are thinking about expansion, or are concerned about risk mitigation.
If you are looking to create accurate forecasts on your internal operations, such as your sales, a specific product, or a manufacturing division, internal business forecasting is ideal. Internal forecasting is excellent if you need an expert opinion on how things such as your warehouse distribution, purchases, cash flow, or profit margins are trending.
Examining your current trends and predicting future possibilities makes demand forecasting important for any company. Even just using the most straightforward methods can help a company of any size gain insight into how to follow their goals and which goals to set.
Using methods such as short-term forecasting, you can closely examine seasonal trends around your products. By predicting and understanding your customer demand spikes, you can better know how to handle your supply chain and inventory needs. Knowing your seasonal trends can also reveal markets and niches you have yet to tap into during your slower months.
Examining your past cash flow and comparing it to future predictions can help you better understand where your cash flow is going and how much you will have to invest in the future. Having a better understanding of your potential financial health in the future can help you make crucial decisions and goals.
Looking at demand trends, especially seasonal spikes, can help you better plan your supply chain needs. Rather than running out of inventory during your peak seasons, you can invest in more from your suppliers before these higher-demand periods. Knowing when your lulls are in demand for certain products, you can better plan your marketing strategy and only stock as much inventory as is needed during these periods.
External macro forecasting gives you an in-depth look at how outside factors can influence your product performance, sales, marketing, and supply chain. As you understand how different risks may harm your suppliers, products, or business, you can appropriately prepare for changes in external markets to better protect your company. Looking at outside influences can also help your company become more flexible and robust to react to these changes and take advantage of them quicker.
Predictions are a great way to gather data about potential future trends for your company. From threats that you need to prepare for to new markets you should break into, forecasts can help your company make big moves for the future. Whether changing your marketing strategies or reinforcing your supply chain, different forecasts will help you make decisions across your business to bring future success.
ShipHero makes demand forecasting simple, helping you easily gain insight into fulfillment operations, products, shipments, and returns. Our data reporting helps you see everything going on in your warehouse operations to help you make educated and data-backed decisions.We facilitate day-to-day actionable reporting to help keep your team organized while streamlining the process, actionable shipping reporting, and individual team member stats. ShipHero tracks:
Demand forecasting and data analysis help your company make big decisions to give you an edge over the competition. From inventory analysis to marketing initiatives, your company will be able to reduce risks for new endeavors and make profitable decisions. Programs like ShipHero can help.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 TodayAaron Rubin, Founder & CEOShipHeroAbout 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. Rubinâs greatest strengths are leadership, change management, strategic planning and a passion for progression. He is known for having his finger on the pulse of ShipHeroâs 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.
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While your team is still walking aisles, your competitors are cutting pick times in half with automation. Guess whoâs shipping faster and stealing market share?
Automation isn't the future anymore. It's the present. For growing eCommerce brands or fulfillment centers under pressure to deliver faster, cheaper, and more accurately, automated warehouse picking systems are no longer a luxury. They're a necessity.
In this guide, you'll learn how automated picking systems work, the types available, how to choose the right one, and how ShipHero can help you streamline fulfillment processes with confidence.
Automated warehouse picking systems use software, robotics, and real-time data to locate, retrieve, and prepare items for shipment, without relying solely on human labor. Instead of employees walking long distances and manually selecting items, automated systems bring items to workers or direct them with tools like lights, voice commands, or mobile robots.
For example, in the eCommerce space, brands use Goods-to-Person (GTP) systems to increase operational efficiency and efficiently handle large catalogs of SKUs. In retail, where seasonal order surges can overwhelm manual processes, automated solutions help companies double their picking speed and maintain consistent fulfillment even during peak demand.
The process is surprisingly seamless:
This flow is driven by smart software that integrates with warehouse management systems and supports key warehouse processes, including picking, packing, and tracking real-time inventory.
Want a deeper look at the tech behind it? Read this guide on warehouse automation software.
Thereâs no universal solution for warehouse automation. The best picking system depends on your space, order volume, and the variety of products you offer. Some work better for high-SKU, high-volume operations; others are ideal for smaller, more focused setups. Below, we break down the top systems and which warehouse types theyâre best suited for.
GTP systems deliver inventory directly to a stationary picker, eliminating walking marathons. This setup enhances inventory management, reduces physical strain on workers, and improves worker safety.
It also optimizes order accuracy by minimizing human error. By minimizing walking time and keeping pickers in one place, GTP systems significantly boost pick rates while also cutting down on labor fatigue.
Pick-to-Light is an automated solution that uses LED light bars to guide workers to the right location for picking items, enhancing accuracy, speed, and efficiency while reducing errors.
When paired with Pack-to-Light and Receive-to-Light, your entire workflow is streamlined. Pack-to-Light ensures precise packing, while Receive-to-Light optimizes inventory storage and retrieval. Together, these technologies simplify inventory management, reduce labor costs, and accelerate fulfillment.
At ShipHero, we offer all three solutions, Pick-to-Light, Pack-to-Light, and Receive-to-Light, under one roof, seamlessly integrating with your existing systems to optimize warehouse operations. The combination can help boost efficiency by 20% while also cutting costs by up to 30% for batches of 10 to 30 orders.
Pickers wear headsets and follow voice commands to locate items, like a GPS for your warehouse. This hands-free approach automates repetitive tasks, shortens training time, and reduces picking errors, even in noisy environments. It also improves accuracy, even in noisy environments where traditional methods might fall short.
AMRs, or autonomous mobile robots, navigate the warehouse floor independently, delivering items or bins to human workers or packing stations.
Unlike fixed systems, AMRs offer greater flexibility and adapt to varying warehouse sizes, support scalable operations, and offer the flexibility to grow without major infrastructure changes. Theyâre also highly scalable, which makes them a smart choice for warehouses looking to grow or adjust operations without major infrastructure changes.
These are high-tech racking systems equipped with robotic cranes or shuttles that automatically store and retrieve inventory. Theyâre especially well-suited for large warehouses with high inventory turnover, where speed and space efficiency are critical.
Businesses that need to maximize vertical storage find these systems invaluable, and industries such as pharmaceuticals, automotive, and electronics often benefit the most from their precision and scalability.
Still not convinced? The real-world benefits speak for themselves. Automation significantly reduces human error, particularly in fast-paced warehouse environments where accuracy is crucial. It also speeds up fulfillment, often cutting pick times in half or more.
By streamlining operations, businesses can lower labor costs by either reducing headcount or reassigning team members to more valuable tasks.
By transitioning to automation, companies often see dramatic improvements in efficiency and cost savings. For example, automation can reduce warehouse labor costs by up to 60%, allowing businesses to reallocate resources and scale more effectively.
Itâs not always smooth sailing when implementing automated picking systems. One of the biggest hurdles is the high initial investment, as hardware, software, and integration can come with a steep upfront cost.
Staff training is another challenge, as teams need time to learn how to use the new technology effectively. There can also be short-term disruption; installation and onboarding may temporarily slow down operations. But the long-term gains are often worth it.
For example, James Enterprise struggled with paper-based picking and processing delays before switching to ShipHeroâs Warehouse Management System.
The transition required workflow changes and staff training, but with proper planning, such as going paperless, reorganizing their layout, and utilizing smart pick paths, they boosted productivity by 38%. New hires cut their pick time from 55 to 34 seconds in just five days, proving that smart automation pays off.
Finding the right automated picking system starts with understanding your specific needs. Warehouse size plays a big role, as larger spaces often benefit most from solutions like AMRs or AS/RS that can cover more ground efficiently. If your business manages a high variety of SKUs, systems like GTP or voice picking can offer the flexibility and accuracy you need.
For those working with tighter budgets, starting with light-based or voice-guided systems can provide a solid foundation without breaking the bank. Regardless of your starting point, scalability is crucial; your system should be able to grow in tandem with your business. Partnering with ShipHero ensures you get expert, customized guidance and future-proof solutions designed specifically for your operation.
Implementing warehouse picking automation isnât just about installing new tech; itâs about doing it strategically. To get the most out of your investment and avoid common pitfalls, follow these proven best practices:
âBest Practices for Successful Warehouse Picking Automation
For example, Black Wolf Nation and its 3PL arm, ONE23 Fulfillment, partnered with ShipHero to scale their operations. By adopting ShipHero's warehouse management software, they increased their order volume from 10,000 to over 25,000 per month in less than a year. This strategic implementation allowed them to efficiently manage growth and expand into the 3PL space.
Most companies see a return on investment within 12 to 24 months, depending on the system and order volume.
Yes. Many automated systems are designed to be scalable and cost-effective, which makes them ideal for small warehouses. Solutions like Pick-to-Light and voice picking can start small and expand as your operation grows.
Yes. Advanced systems feature adjustable grippers, sensors, and packaging logic to safely handle delicate or irregularly shaped products.
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Warehouse management systems make daily warehouse operations efficient. And wave planning is at the heart of it.
As part of the supply chain industry where efficiency is of utmost importance, the fast-paced environment of warehouse management requires every aspect of operations to work on schedule. This is where wave planning comes into play and brings efficiency to the table.
It integrates with warehouse management systems and streamlines end-to-end warehouse operations to meet customer expectations of fast shipping and real-time updates.
Wave planning batches orders for optimized picking routes, shipping, and priority. It supports operational workflows and integrates with warehouse wave picking strategies to maximize productivity, reduce errors, and improve overall daily warehouse output.
This turns warehouse operations into an organized process of handling and systematizing hundreds of orders a day.
Applying the best practices for wave management allows for maximum efficiency in managing daily warehouse operations. Start with these:
Not all orders need to be shipped at the same time. Some can wait, others canât. Strategic planning means prioritizing orders based on shipping deadlines to ensure they are shipped out and delivered on time. This increases customer satisfaction and overall operational efficiency. To better understand the core workflows that make this strategy effective, explore how we have explained the six key warehouse processes.
Accessing real-time data allows you to monitor every wave thatâs happening, from orders getting picked up to those that are delayed. This lets you take action accordingly, especially when spotting issues as they are happening.
Downtimes are red flags in wave management. They are equal to unproductivity and possible shipment delays, both affecting operations to meet quotas and customer satisfaction.
Reduce idle time in operations with these methods:
High-demand periods like holidays, promotions, and occasional spikes can cause chaos, especially if you donât have a plan in place. That chaos can overwhelm your normal operations and lead to delays and unsatisfied customers.
Avoid this by ensuring scalability for peak periods with effective wave planning:
If youâre preparing your warehouse for high-volume fulfillment, it may be worth exploring how automated warehouse picking systems can make wave execution more efficient and adaptable.
Warehouses have different zones to which pickers are assigned.
Having specific picking zones gives structure to the picking process, making it easier to execute even through high-volume orders.Having defined picking zones helps:
Wave management gives you the flexibility to adapt quickly when an unexpected change occurs during operations.
A common issue often faced in wave management is the sudden changes in order volume. This disrupts the flow of current waves and may have an avalanche effect on the whole operation if not solved immediately.
Hereâs how wave management adjusts operations to meet demand fluctuations:
A warehouse management system creates an overall plan that controls the flow of a warehouse's production. Using tools and automation, a WMS simplifies and streamlines wave management to execute warehouse operations from fulfillment to packing and delivery.
The main difference between wave planning and wave management is that the former is where the strategizing happens, while the latter is the execution and overseeing that the plan takes place.
Wave planning is the strategic part of grouping what orders should be fulfilled together, setting the time for wave releases, and adjusting them based on warehouse capacity and labor availability.
Wave management is the main operational part where the production happens. It tracks the real-time progress of wave execution to ensure things are running smoothly according to plan.
The main difference between digital and wholesale waves lies in their order size, wave planning, and operational goal. Due to their differences, each wave type requires different planning and strategy.
Digital waves service the B2C channel, are high in volume, and often have small, single-item orders that require urgent or same-day deliveries. The wave strategy used is frequent and short for flexibility. For this wave type, warehouse managers use WMS-integrated mobile devices for tech support
Meanwhile, wholesale waves are for bulk orders, often for retail distribution, resellers, or B2B supply chains. Wholesale waves have a lower order volume with large shipments and more flexible timelines.
Yes, it can be used if they have large volumes of orders per day, orders with time-blocked pickups, or group orders with shipping deadlines.
Yes. eCommerce and retail, grocery and food distribution, healthcare and pharmaceutical, industrial supply, and consumer packaged goods industries are industries that benefit from wave planning. These are industries with high order volume, delivery sensitivity, and high operational complexity.
Yes, wave management is designed to make warehouse operations, including same-day shipping, possible. Wave management creates a structure that speeds up the order fulfillment, speeding up the process for all warehouse operations, such as same-day shipping.
Your warehouse isnât slow because your team isnât working hard. Itâs slow because theyâre working inefficiently. When every picker is chasing orders in random directions, you lose time, increase errors, and risk customer satisfaction.
Wave picking fixes that by turning chaos into coordination. By grouping orders for optimized picking routes and releasing them in scheduled âwaves,â you can streamline picking, reduce walking time, and enhance picking speed, especially in high-volume eCommerce environments.
In this guide, weâll explain what wave picking is, how it works, and how to use it to run a faster, leaner, and more accurate warehouse.
Wave picking is a warehouse picking strategy where orders are grouped and released in scheduled âwavesâ throughout the day. Each wave organizes orders based on factors like delivery time, product type, or warehouse zone, to help your team pick faster, move smarter, and stay organized. When paired with automated warehouse picking systems, wave picking becomes even more powerful, and minimizes manual effort while maximizing speed and accuracy.
For example, a warehouse might group all orders that need same-day shipping into a morning wave, while standard shipping orders are picked in the afternoon. This keeps the flow structured and reduces chaos on the floor.
Brands using wave picking have seen measurable results. A study published in Acta Logistica found that accurately batching and releasing orders in structured waves reduced cycle times by more than 13% compared to unplanned methods, proving how it standardizes warehouse processes and improves resource utilization. This demonstrates how even modest changes in picking structure can lead to significant gains in warehouse efficiency.
Wave picking operates through a structured, three-phase process: pre-wave, wave, and post-wave.
Each stage plays a critical role in coordinating order fulfillment, from organizing batches of orders to guiding pickers efficiently through the warehouse and ensuring fast, accurate packing and shipping. Understanding how each phase works is key to unlocking the full efficiency potential of wave picking.
Before picking begins, the warehouse management system (WMS) organizes inventory for efficiency by grouping orders into waves based on factors like shipping deadlines, SKU type, or zone. It then generates batch pick lists, allocates resources, and ensures that equipment and carts are ready, laying the groundwork for a smooth picking process using proven picking strategies.
Good Company, a 3PL provider, exemplified this by leveraging ShipHero's multi-item batch feature. This streamlined their pre-wave setup, enabling them to group multiple orders with shared items into single picking runs. This drastically reduced picker travel, and as they scaled from 500-600 to 6,000-10,000 units daily within 18 months, allowed them to halve their pick time. This demonstrates the immense power of an optimized pre-wave process.
Once a wave begins, pickers follow optimized routes through the warehouse to collect items. The goal is to reduce backtracking and congestion by assigning pickers to specific zones or paths.
E-Commerce Xpress, an eCommerce fulfillment provider, has significantly streamlined its picking process by adopting ShipHero's Warehouse Management System (WMS). Their previous manual methods caused inefficiencies and excessive picker travel. By using ShipHero's multi-batch order feature, they transformed their picking phase. This technology groups multiple orders into single runs, creating highly optimized routes and eliminating unnecessary trips. The result was profound: E-Commerce Xpress could fulfill 200 orders in just 2 hours with one person, a task that previously required four staff members 4-5 hours. This showcases how wave picking handles peak operational loads and supports multi-order fulfillment with ease.
After items are picked, they move to packing and shipping. This phase includes labeling, verifying accuracy, and dispatching the final product. A well-organized post-wave process ensures orders are completed on time and without mistakes.Consider Vareya, a 3PL and fulfillment company, which dramatically improved its post-wave efficiency and client satisfaction by adopting ShipHero's Warehouse Management System (WMS). Previously, Vareya struggled with disconnected systems, resulting in significant errors and excessive paperwork. By migrating to ShipHero, they automated workflows and shipping labels, ensuring efficiency and accuracy in packing and dispatch. This allowed them to triple business volume and meet customer service levels consistently.
To get the full benefits of wave picking, itâs essential to follow proven best practices that align your people, tools, and workflows. From using the right technology to organizing pick paths and handling carts efficiently, these core strategiesâlike those in our warehouse picking strategies guideâwill help you maximize speed, accuracy, and productivity in every wave.
A powerful WMS like ShipHero automates wave creation, drives real-time decision-making, and optimizes paths. It ensures every wave is precisely executed and synced with inventory.
Calculating optimal picking routes is one of the most effective ways to reduce travel time on the warehouse floor, a major contributor to inefficiency. By using route optimization software, pickers follow the shortest and most logical paths through the facility, thereby avoiding unnecessary backtracking and congestion. This not only speeds up fulfillment but also reduces fatigue and boosts overall productivity, especially in high-volume environments where every second counts.
Efficient cart handling is key to successful wave picking. Organizing carts by order, zone, or SKU reduces sorting time and speeds up packing. This keeps the workflow smooth, reduces errors, and enhances overall fulfillment efficiency.
Wave picking comes in different forms, each suited to specific warehouse needs. Whether youâre handling large SKU volumes, urgent orders, or multiple zones, choosing the right strategy can boost speed, accuracy, and efficiency.
Organizing wave picking by product type allows warehouses to group similar SKUs into the same wave. This reduces picker travel time, as items are often stored near each other, and enables faster, more efficient picking by creating consistent, repeatable paths through the warehouse. Itâs especially useful for high-assortment operations where grouping like products streamlines the process.
Wave picking by order priority ensures that urgent orders, such as express shipments or VIP customers, are grouped and processed first. By releasing these high-priority orders in the earliest waves, warehouses can ensure faster turnaround times and meet strict delivery deadlines, thereby maintaining high customer satisfaction and consistent service levels.
Dividing the warehouse into picking zones allows each wave to focus on a specific area, reducing unnecessary movement and streamlining the picking process. Assigning pickers to dedicated zones allows waves to run simultaneously in different zones, reducing congestion and enabling scalability in operations.
Wave picking is a fulfillment strategy designed to group orders into scheduled "waves" based on factors like shipping deadlines, product locations, or customer types.
This method is especially valuable in high-volume or time-sensitive operations where precision and speed are critical. Below are four key benefits of using wave picking in your warehouse:
Wave picking keeps operations structured, which allows you to process more orders per shift without expanding your physical footprint.
By reducing idle time and unnecessary movement, wave picking streamlines the entire fulfillment process. After adopting ShipHeroâs WMS, American Tall saw a 275% increase in picking efficiency and cut fulfillment errors by 50%, allowing them to scale operations by 400%âclear proof of how structured picking methods lead to faster, more reliable order delivery.
With batch pick lists, scanning, and real-time tracking, wave picking drastically reduces errors in item selection and order completion.
Fewer errors, faster picks, and optimized labor use = lower costs. Wave picking helps you do more with fewer resources.
The main difference between wave picking and batch picking lies in their timing and level of structure. Wave picking organizes and releases orders at scheduled times throughout the day, which is ideal for high-volume warehouses where precise timing and a smooth workflow are essential. This method offers a structured approach that reduces errors and supports scalability, but it requires more upfront planning and a reliable warehouse management system.
In contrast, batch picking allows warehouse staff to pick multiple orders in a single trip without being tied to a specific schedule. Itâs a simpler, more flexible method thatâs well-suited for smaller operations with lower order complexity.
While batch picking is easy to implement and has a lower barrier to entry, it becomes less efficient when dealing with large volumes or time-sensitive orders. Choosing the right approach depends on your warehouse size, order volume, and fulfillment goals.
Yes. Wave picking can scale down for smaller operations to help them improve organization, reduce picker confusion, and streamline fulfillment.
No. Only certain WMS platforms, such as ShipHero, offer full wave picking functionality, including automated order grouping, routing, and inventory syncing.
Absolutely. Wave picking was designed for fast-paced, high-volume environments where timing, accuracy, and scalability are critical.
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