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A Look Inside Newegg
An anonymous reader writes "AnandTech has an interesting look inside Newegg's 180,000 square foot facility. Effectively, they followed the path of an order after it was soon placed online. AnandTech was able to get a tour of their facilities before, but this is the first time they allowed them to publish any photos."
I used to work for Wal-Mart a number of years ago. Their system is called SMART (IIRC, that is Systematic Merchandising and Applied Retail Technology). Their process is known as "perpetual inventory" and for good reason. The computers know how much inventory is in the store at any given time (like any good POS), as well as how many will fit on the shelf, how many come in a case, etc. When it sees that the "on hand" count is getting to the point where the shelf cannot be kept full from overstock, it orders more. It also knows the inventory levels at the warehouse, and how long the delivery will take, so it can make some predictions that result in stock arriving just as the shelf is no longer full. The system also takes into account sales that are coming up and adjusts the order amounts accordingly. Department manager and some floor associates have the ability to manually adjust the on-hand inventory counts, so you can trick it into sending you more of an item if you want to do a department special. It does a lot more than that, and on paper it should result in an almost fully stocked store and and pretty empty back stock room every morning after the previous night's trucks have been worked out to the floor.
In practice, however (at least at the store I worked at), the on-hand counts were always off due to managers screwing up, shrinkage, warehouse mishaps, etc. The result was that some items were almost always out of stock, and others were piled to the ceiling in the back room because the system kept ordering more when we obviously didn't need any more. To complicate matters, you have holidays and seasonal items to account for, and some departments are somewhat independant of the rest of the store (shoes and jewelry come to mind).
And that's just at the store level. I can't imagine what kind of magic lurks at the distribution centers.
Having frequently purchased things from Newegg.com and been relatively satisfied with being close enough to one of their warehouses to get overnight ground shipping on the cheap, I was recently horrified to discover that they have quietly changed the way they offer shipping in order to pad their own pockets. In case you haven't noticed, Newegg.com no longer offers UPS Ground as a shipping option. They have instead created a new service called "UPS 3-day Guaranteed," which, if you read the terms, basically says that you have to pay for UPS 3-Day Select, but will still get ground shipping if you are close enough to receive your order in 3 days or less. For people like me, that equates to a tripling of shipping charges and nothing else. Newegg.com could not be reached for comment as of the writing of this story. Am I the only one who is outraged?