The holiday shopping season is upon us, traditionally making it the busiest time for commerce. For our logistics this means operating at 2.5 times the average order volume, while still meeting our customer promise to deliver items as smoothly as possible and on time. Masood Choudhry, SVP Logistics at Zalando, is more than ready to take on this challenge. We spoke with him about the most important sales period of the year and the crucial role logistics plays in it.
Masood, how do you feel now that the holiday season is in full swing?
Without any doubt, the holiday season including Cyber Week is the busiest time of the year for us. The number of orders is many times higher than the normal level. This logistics challenge impacts resourcing, which will increase across our fulfilment centres to 20,000 colleagues, while our automation technologies will be pushed to their limits. Nevertheless, this does not keep me up at night because we have spent a long time preparing for this.
What do you mean by long time?
We started analyzing results shortly after last year's Cyber Week. We questioned everything and asked ourselves: what worked well and what could we improve upon? Many teams are involved in this process including Transport, Warehouse Operations, Packaging, Network Planning (a team that manages the forecasts and planning), Zalos teams (who are responsible for our warehouse management system), MFT (a team that manages the automation technology), Fulfillment Core (who manage the delivery promises and order allocation across warehouses), ZPL (Zalando Premium Logistics) the recruiting team, and many many more. They all contribute to Zalando successfully going through the peak season. It's crucial that our colleagues work together collaboratively. It’s a team effort!
How did you prepare the logistics center teams?
We know that our customers expect a seamless experience when shopping at Zalando – especially when it comes to everything after they place their order. It is our responsibility to ensure everything runs smoothly in logistics. That's why we have strengthened our position in three important areas.
Firstly, we’ve expanded our European logistics network and thus our entire capacity in general. We are currently serving more than 46 million customers in 23 markets from our 13 logistics centers operating in seven countries. Two new fulfillment centers in Rotterdam and Madrid went live this year and several existing warehouses will be ramped up to deliver significantly more capacity than last year.
Secondly, we worked with our employees to improve processes in our logistics sites to be ready for the increased demand. In Erfurt, for example, we installed an additional mobile sorter to increase parcel sorting capacity. At bag sorter technology sites (Lahr, Mönchengladbach and Verona) we habe worked on optimising the workflow to the bag sorter to increase capacity and improve efficiency. All fulfillment centers have been through stress tests to ensure both operations and technology are ready for peak season.
Last but not least, we are investing in improvements to serve our customers better in the long term. For example: Customers are buying more and more beauty items at Zalando and here we have adapted our logistics centers and now ship these products from all our German and Polish sites instead of having Erfurt handling the entire beauty volume alone. We have also invested in extra capacity to support our Plus proposition in Germany, Italy, France and the Netherlands.
The Covid-19 pandemic is not over yet. How does Zalando ensure the health and safety in the warehouses during peak time?
From the beginning of the pandemic, Zalando put the health and safety of employees first while serving customers across Europe. In all of our locations, strict preventative measures have been implemented – from social distancing and obligatory masks, to hygienic measures and separation of shifts. These measures followed, and even expanded on, government guidelines and recommendations. These measures will also remain in place during the peak season. This week we also managed to introduce 3G across our German fulfillment centers and so far this has been executed successfully. Moreover, we will continue to support all employees who wish to get vaccinated. In our in-house vaccination centers, more than 5,000 appointments were scheduled this summer. Unfortunately, the pandemic is not over yet – but we are doing our best to combat Covid-19.
During the holiday season, Cyber Week stands for an exceptional sales peak. Does that mean you and the teams can sit back and relax a bit outside of it?
After Cyber Week, of course, we can't all go on vacation immediately, because there's a lot to do: The numerous orders need to be processed and shipped. We do our best to make sure that our customers get their new favorite items as quickly as possible. Once this work is done, we will focus on the rest of the holiday season and then take some time to breathe.