Distributed Fulfillment Centers Sharing Inventory for Fast Delivery
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Solution Overview
Problem
Existing logistical fulfillment systems face challenges in providing immediate delivery of large orders while maintaining a wide range of items and high availability, especially for customers located far from centralized fulfillment centers, leading to increased costs, waste, and customer dissatisfaction.
Innovation Solution
A system comprising three fulfillment centers that share items and are controlled by a unit capable of stock level management, scheduling, forecasting, and transhipping, allowing for efficient distribution and delivery of items within one hour, same day, or next day, by utilizing a mesh network configuration and standardized containers for inventory management.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If a centralized hub and spoke fulfillment model is used, then item availability and range are improved, but delivery time increases for customers located far from the central fulfillment center
Solution Approach 1:
The patent divides the centralized fulfillment system into multiple distributed fulfillment centers (spokes) that operate semi-independently. Each fulfillment center maintains its own inventory and can fulfill orders locally, while still being part of the broader network. This segmentation allows customers to receive items from the nearest fulfillment center, reducing delivery time while maintaining wide item availability through the network effect.
Solution Approach 2:
The patent transitions from a single centralized fulfillment center (0D/1D model) to a multi-location distributed network (2D/3D model). By adding the spatial dimension of multiple fulfillment centers distributed geographically, the system maintains item availability across the network while enabling faster local delivery through proximity to customers.
2Speed
If the fastest possible fulfillment method is used for individual items, then delivery speed is improved, but multiple packages are sent leading to increased costs and customer dissatisfaction
Solution Approach 1:
The patent merges multiple individual item fulfillments into consolidated delivery routes. The system groups items destined for the same customer or geographic area into single delivery packages, even if items are picked from different fulfillment centers. This consolidation maintains fast delivery speeds while improving fulfillment efficiency by reducing the total number of packages and deliveries required.
Solution Approach 2:
The patent introduces an intermediary coordination layer (the network control system) that manages the consolidation of items across multiple fulfillment centers. This intermediary optimizes routing and grouping of items, enabling fast delivery without the inefficiencies of multiple separate packages by intelligently combining items into optimized delivery batches.
3Ease of operation
If a hub and spoke model with small fulfillment centers is used, then local delivery capability is improved, but delivery time increases due to the additional transshipment step
Solution Approach 1:
The patent implements preliminary action by pre-positioning inventory at multiple distributed fulfillment centers based on demand forecasting and historical data. Items are proactively stocked at local spokes before orders are placed, eliminating the need for time-consuming transshipment operations. This allows fulfillment centers to immediately fulfill local orders without waiting for items to be transferred from the central hub.
Solution Approach 2:
The patent creates a dynamic fulfillment network where the system intelligently determines in real-time whether to fulfill orders from local inventory at spoke centers or to initiate transshipment from the central hub. This dynamic approach optimizes fulfillment time by using local inventory when available (avoiding transshipment delays) while maintaining the ability to service any item from any location in the network.
Data Source
AI summary
The present disclosure provides an apparatus and method for automated controlling of a logistical system such that immediate delivery of items is achieved whilst offering an enhanced range of different types of items to a majority of customers. Exemplary embodiments introduce a virtual distribution centre in which items are shared between fulfilment centres which are located close to a customer. An exemplary system includes at least three fulfilment centres, each fulfilment centre being configured and arranged to fulfil orders to customers and/or stores, and a control unit configured and arranged to control the at least three fulfilment centres. Each of the at least three fulfilment centres is configured and arranged to share items with at least one other of the at least three fulfilment centres.