Flipkart: The One-stop Shopping Destination

Why Flipkart? - Flipkart believes in hiring the smartest of the lot. As an equal
opportunity employer, Flipkart offers a workplace that promotes diversity and
inclusion. The work culture they have is built to foster a sense of belonging and
help employees build for themselves a space to share their passion. The idea is to
collaborate to innovate as a team.
Flipkart has harnessed technology to drive path-breaking, customer-focused
innovation that makes high quality products accessible to Indians, besides making
the online shopping experience convenient, intuitive and seamless. Our growth has
been powered by our strong community of Flipsters (employees at Flipkart) that
have innovated across consumer technology, product design & development,
artificial intelligence, supply chain management to deliver several industry-first
disruptions such as cash on delivery, no-cost EMI, 10-day replacement policy, an
automated marketplace and more
To motivate employees - Flipkart tries to innovate with the food it provides the
ground staff, and also conducts Yoga and stretching sessions as stress busters for
employees on the floor. ... To motivate and energise such staff Flipkart ensures
that all the needs of the employees are taken care of.
The following are the characteristics of the different types of third-
party logistics services:
 Transportation Based Third Party Logistics Services.
 Warehouse/Distribution Based Third Party Logistics Services.
 Forwarder Based Third Party Logistics Services.
 Shipper/Management Based Third Party Logistics Services.
1. Transport takes up a considerable percentage of Ekart’s cost
Ekart transport uses multiple modes of transportation, sets various contracts with
vendors, provides coverage of 5000+ pin codes and forms the backbone of the
distribution chain for Flipkart. At any point in time, the value at risk is of the order of
Rs X of crores (INR) and over 8+ lakh products.
2. Buying transport capacity on the spot is expensive
Any last-minute changes and a subsequent increase in the probability of operational
lapses at the loading or unloading site add to supply chain expenses. In addition,
transport capacity may not be available on demand.
In addition, the following business goals of the Logistics in Supply Chain also
contribute to the need for Capacity Planning mechanism:
  Ekart logistics needs to ensure that Flipkart gains maximum benefits in terms
of Capacity Utilization of the assigned line-haul trucks.
 Vendors want to ensure maximum profitability in the transportation of goods.
Warehouse management – Speed and Accuracy management
1. Order Picking Accuracy (percent by order)
2. Average Warehouse Capacity Used
3. Peak Warehouse Capacity Used
4. On-time Shipments
5. Inventory Count Accuracy by Location
Business of logistics: group of activities all involved in the movement, control and
storage of inventory from its procurement to its point of consumption.
Logistics Management: the process of managing procurement, moving and
storage of goods in way that aims to allocate the right amount at the right time and
with the best cost.
Supply chain management: the process that involve in the product creation and
flow from raw material sourcing to production, storage and deliver it to customers.
Procurements: Procurement is the act of obtaining goods or services, from an
external source, often via a tendering or competitive bidding process.
Warehouse management: the process of controlling the warehouse operations
from the entry of the inventory into the warehouse till it gets consumed or delivered
to its final destination.
Inventory management: the process of ordering, handling, storing, and selling
inventory. So, it means the right stock, at the right level, in the right place, at the
right time, at the right cost and with the right price.
Fleet management is the practice of managing commercial motor vehicles such as
cars, vans and trucks to ensure optimal utilization, fuel consumption and
maintenance. Fleet managers may also play a role in helping to coach drivers to
improve fleet safety, compliance and liability.
Warehouse accuracy means making the system of storing, receiving, and
distributing inventory more efficient and accurate. Inventory inaccuracy is a
headache in itself that erodes warehouse's efficiency and business profitability.
Order cycle time is the average time between any two orders shipped.
BEST PRACTICES FOR EFFICIENT WAREHOUSE MANAGEMENT
Audit your warehouse operations: One of the tools in managing warehouse
operations is conducting an operational audit. Auditing your warehouse every year
helps you in updating stock and accounting for all products gone missing. Evaluate
whether changes need to be made to make it run more effectively. This also helps
you in gauging your supply chain performance.
Implement cross-docking and labeling: Cross-docking is the practice of
unloading materials from an incoming vehicle and immediately loading the same
items directly onto the outbound vehicles with minimal warehousing interval in
between. It helps in reducing the TAT and increases profits and is of course, time-
saving. Mostly, the companies in the pharmaceutical sector use cross-docking to
save time and distribute their perishable products to the end consumer. Walmart is
also known to implement cross-docking for a lot of their items.
Labeling also helps in having a fast-moving warehouse. SKU numbers, clear labels,
or barcodes can help in the easy identification of your products.
Implement safe measures in your warehouse: A safe warehouse means
implementing regular training and awareness courses. The staff that knows how to
use equipment safely and adequately typically keep warehouses running more
efficiently and better managed. Safety protocols must be followed sincerely, and
danger zones must be marked and noted by the staff.
Increase staff productivity: Managing a warehouse needs a productive team to
make sure orders are not delayed. A warehouse manager can make sure the staff is
adequately taken care of and efficiently conducting themselves. Loyalty programs,
incentives, and other morale-boosting programs can be set up so that they do not
feel burdened. The workers should also be educated and trained correctly to
maximize productivity. A lot of brands conduct seminars and workshops for their
employees to ensure that their staff is well-trained and informed about the
operations.
Maximize your space: As we said earlier, having proper documentation of your
floor plan and warehouse space helps you take care of more inventory. The
warehouse should be organized in such a way that the operation flow from receiving
to packing is done smoothly. Making use of vertical space and bin locations also
helps in maximizing your warehouse space and easy to navigate.
Track the right metrics: Tracking the right KPIs makes all the difference. It helps
you gauge your vendor performance, delivery accuracy, customer satisfaction, and
much more. Using data to analyse these metrics are also important. Having a
thorough understanding of these numbers is also crucial for the growth of your
eCommerce business.
Warehouse operations managers can improve warehouse performance by
monitoring key performance indicators (KPIs) such as:
1. Receiving efficiency
2. Picking accuracy
 3. Carrying costs
4. Inventory turnover
5. Rate of return
6. Backorder rate
7. Order lead time
Invest in a Warehouse Management System: WMS systems are meant to
automate and implement tracking in a day-to-day activity of a warehouse. Locating a
particular item within the warehouse can be challenging for a large warehouse with
multiple staff members. WMS solves that pain. It is much more beyond that. WMS is
capable of monitoring product quantities, cycle counting, picking, packing, shipping,
and managing multiple locations. Although a time-consuming process, automating
your warehouse operations is super beneficial.
Inventory reconciliation is the process of comparing physical inventory counts with
records of inventory on hand. This is an important process as it helps reduce stock
discrepancies and understand why there are discrepancies in the first place.
INVENTORY MANAGEMENT TECHNIQUES
1- Minimum order quantity MOQ which is the minimum amount of set stock that
the supplier is willing to sell.
2- ABC Analysis which is categorizing inventory into three categories to identify
items that have a huge impact on the inventory cost. Category A which represents
the most valuable and fast-moving products that have the most overall profit, then
we have category B which represent the products that come in between the most
and the least valuable products, and finally category C which represents the lowest
transaction and overall profit.
3- Safety stock inventory which is extra inventory ordered beyond expected
demand in order to avoid stock out for any reasons.
4- FIFO & LIFO: First in, first out and Last-in, First-out are methods to determine the
cost of inventory.
5- Economic order quantity EOQ is a formula for the ideal order quantity a
company needs to purchase for its inventory in order to minimize the overall cost
6- Just in time management (JIT) which is a technique used to arrange raw
material from supplier in direct connection with the production line in order to reduce
the inventory costs.
WAREHOUSE KPI’S RELEVANT TO DISTRIBUTION:
 1. Order Lead Time: The average time taken by an order to reach the customer
once the order has been placed. This is one of the most crucial KPIs for
warehouses and distribution centers.

2. Perfect Order Rate: Number of orders the warehouse delivered without error.
It indicates the success rate of the warehouse/distribution center.
3. Back Order Rate: The rate at which orders are coming in for items that are
out of stock. There are situations wherein unexpected spike in demand causes
this. However, if this rate is consistently high, it is an indication that there are
lapses in planning and forecasting.
A 3PL company is on the forefront of carrier’s arrangement and warehousing. They
deal directly with the service providers. A 4PL on the other hand, arranges the same
services for their clients but instead of direct handling, they engage 3PL companies
and other service providers who use their network of carriers and warehousing
providers.
3PL: Stands for third party logistics, which is a business’s use of an outside
company to manage a warehouse or group of warehouses.
Advanced Shipping Notification: A document that is sent to a warehouse
management system from a supplier that provides information about a pending
shipment.
Barcode: A marking made up of a series of bars and spaces used for identification
of products in which a scanner is used to read the encoded information.
Batch picking: A process of order picking in which all the items for multiple orders
is picked by a single picker.
Bill of Lading: A document that details items in a shipment that acts as a receipt
given by the carrier of the shipment to the recipient of the shipment.
Cross Docking: Refers to the practice of moving products directly from the
receiving area to the shipping area for distribution rather than being put away and
stored for a period of time.
Discrete picking: A process of order picking in which the picker pick all the items
for one particular order.
Line: The products in an order that share the same SKU (Stock Keeping Unit) or
UPC (Universal Product Code) number.
Order: All the products that are including on one transaction from a customer.
Purchase Order: A purchase order is a document that is sent from a buyer to a
supplier requesting an order for merchandise. The purchase order usually lists the
type of item, quantity, and agreed-upon price.
Put away: This refers to removing incoming orders from the location where it is
received to the final storage area and recording the movement and identification of
the storage location where it has been placed.
1. Putaway Cost Per Line: Expenses incurred for putting away stock per line,
including labor, handling, and equipment costs.
2. Putaway Productivity: Volume of stock put away per warehouse clerk per
hour.
3. Putaway Accuracy: Percentage of number of items put away accurately at
the designated location.
4. Labor and Equipment Utilization: Percentage of the labor and material
handling equipment utilized during the put-away process.
5. Putaway Cycle Time: Total time taken during the entire process of each put-
away task.
Receiving: The process involving the physical receipt of merchandise, its inspection
for accuracy and to identify any damage, the determination of where the stock will
be stored, delivery to that location, and the completion of receiving reporting.
Warehouse KPI metrics that correspond to the receiving process are:
1. Cost of Receiving Per Receiving Line: The expense that the warehouse
incurs on the receiving process of each receiving line. This includes handling
costs as well.
2. Receiving Productivity: Determined in terms of labor by measuring the
volume of goods received per warehouse clerk per hour.
3. Receiving Accuracy: Percentage of accurate receipts, i.e., the proportion of
correctly received orders against purchase orders.
4. Dock Door Utilization: Percentage of how many of the total dock doors were
utilized.
5. Receiving Cycle Time: The time taken to process each receipt.
Replenishment: The process that involves moving stock from a secondary storage
area to a fixed storage location. This could also refer to the process of moving stock
between distribution centres or from suppliers to meet customer demand.
Rate of Return: The rate at which goods, once sold, are being returned. This is
most effectively used when segmented by reason for return.
QR Code: A Quick Response (QR) code is a scannable code, made up of various
black and white squares, that allows cameras or smartphones to read it and take the
user to a stored URL or other information.
Unit: One particular physical item or product.
WMS (warehouse management system): The software solution that keeps track of
all warehouse operations including receiving, put away, picking, shipping, and
inventory.
Zone picking: A process of order picking in which different pickers pick items of an
order from specific assigned storage areas to be assembled for shipping later.
Cycle Count - Systematic counting of a portion of the total stock on a certain day,
so all stock can be counted without disruption to the warehouse.
3PL - Third Party Logistics – a warehouse or group of warehouses managed on
behalf of the owner of the stock.
4PL - Fourth Party Logistics – a single interface between the client and multiple
logistic service providers
Active Stock - Stock in active pick locations and ready for order fulfilment.
Aisle - Any passageway within a storage area.
ATA - Actual Time of Arrival.
ATD - Actual Time of Departure.
Backorder - A piece of stock ordered but out of stock and promised to be shipped
when the item of stock becomes available.
Bar Coding - A way of encoding data for fast and accurate readability. Bar codes
are a series of alternating bars and spaces representing encoded information which
is read by scanners.
Blind Receiving - Receiving goods in a DC (Distribution Centre) without any PO or
invoice.
Buffer Stock - A quantity of stock kept in storage to protect against unforeseen
shortages or demands.
Cage - Used for security and to transport stock from one location to another.
Cargo - Merchandise to be carried by some form of transportation.
Compliance - All products, services, processes and documentation comply with
specific requirements.
Consolidation - Combining two or more shipments.
COTD - Complete and On Time Delivery.
Course - A single layer of units making up a unit load also known as a tier.
Cross Aisle - A passageway at right angles to main aisles, used for the movement
of supplies, equipment and staff.
Cross Docking - Merchandise that is received at the warehouse or DC is not put
away but prepared for shipment to retail stores.
Cycle Count - Systematic counting of a portion of the total stock on a certain day,
so all stock can be counted without disruption to the warehouse.
DC - Distribution Centre
DDP - Delivered Duty Paid
DDU - Delivered Duty Unpaid
DSD - Direct Store Delivery
EAN - European Article Number, this is the European version of UPC and contains
13 digits called EA13 or 14 digits called EAN14.
FIFO - First In First Out – using stock based on when it was received.
Fixed Slot - A slot that is reserved for a specific SKU (stock taking unit).
Floating Slot - A slot that is available for any SKU (stock taking unit) as soon as it is
empty and available.
Fulfilment - Fulfilling a customer order.
GTIN - Global Tracking Item Number.
Landed Cost - Cost of product including logistic costs.
Merge in Transit - Merging shipments from suppliers sent directly to the store.
Order Picker - A staff member that is assigned to make withdrawals of warehousing
units.
Pallet Picking - Retrieval of full pallets.
As a key cycle time measure in the order fulfillment process within warehouse
operations, pick-to-ship cycle time captures the number of hours from when an
order is released to be picked until the time the order has been shipped
Perpetual Stocktaking - Stock record keeping system where every transaction both
in and out is recorded.
Physical Stocktaking - Counting all stock within a warehouse in a single event –
also known as a wall-to-wall count.
Picking - A staff member pulls the relevant stock items from storage areas to
complete a customer order.
Pick List - A list of stock items to be picked to fill an order.
POD - Proof of Delivery
RFID - Radio Frequency Identification – electromagnetic field to identify and track
tags on objects.
RTV - Return to Vendor
Shrinkage - Losses of stock from theft, damages and administrative errors.
SKU - Stock Keeping Unit, this is a product or service identification number
assigned to a unique item by a retailer. The SKU can be a number used internally
or may be linked to the UPC (Universal Product Code) or EAN (European Article
Number).
Slotting - Placement of stock within a warehouse to increase picking efficiency.
Sortation - Identifying and separating stock to be sent to specific destinations.
SSCC - Serial Shipping Container Code
UPC - Universal Product Code, this is a 12-digit code which is split into 4 parts. The
first part is a single digit used to identify the remaining digits. E.g., 0 would designate
a regular UPC code where a 3 would show a National Drug Code and 5 would
identify a coupon or voucher. The next 5 digits show the identification of the
manufacturer and the following five is the item number. A single digit at the end is
a character check used to validate the code when scanned.
WMS - Warehouse Management System – systems used to effectively manage
processes, activities within the warehouse.
Zone Picking - Subdividing a picking list by areas for more efficient picking.
Pick & Pack: The process of picking & packing directly impacts lead time. Greater
accuracy in picking means shorter lead time. Picking in the right order decreases the
rate of order return and increases customer satisfaction.
1. Picking and Packing Cost: The cost incurred per order line, including
handling, labeling, relabeling, and packing.
2. Picking Productivity: The number of order lines picked per hour.
3. Picking Accuracy: The percentage of orders picked and packed without
error.
4. Labor and Equipment Utilization: The percentage of labor & pick/pack
equipment out of the total labor and equipment utilized during the process.
5. Picking Cycle Time: Time taken to pick each order.
SOME IMPORTANT WAREHOUSE KPIS TO MEASURE STORAGE
EFFICIENCY:
Carrying Cost of Inventory: The cost of storage over a particular span of time,
including the cost of inventory, capital costs, service costs, damage costs, and costs
of obsolescence. The longer the stock stays in storage, the higher the cost to the
warehouse.
Storage Productivity: Volume of inventory stored per square foot.
Space Utilization: Percentage of space occupied by inventory out of the total space
available for storage.
Inventory Turnover: The number of times the entire inventory passes through
during a period of time.
Inventory to Sales Ratio: Measure of stock levels against sales. This helps
managers identify monthly increases in inventory against falling sales.
Flipkart navigated these complexities by building a lightweight and fast-loading
progressive web app that works seamlessly even on choked networks and poor
signals. This is an innovation unique to the Indian milieu, where thousands of new
customers embrace the mobile internet each day.
The subsidiaries of flipkart that the users can enjoy according to preference are
Myntra, Jabong.com, PhonePe, ekart, and 2gud. Flipkart is an Indian company
and it does not ship its products outside India. It is majorly based in India. In August
2018, 81% stakes of flipkart were owned by U.S. based retail chain walmart. The
company valuing at $20 billion walmart bought the stakes for $16 billion.