VARGO® Featured in Columbus Business First

VARGO® was featured this March on Columbus Business First’s website. Here is the complete article:

Vargo software making warehouse of future happen today

Katy Smith
Print editor
Columbus Business First

Hilliard-based Vargo Material Handling Inc.’s distribution center software yielded some insights into the rise of online holiday shopping this past season. Post-holiday numbers from
Vargo’s top four retail clients, whose fulfillment centers are driven by its Continuous Order Fulfillment Engine software, or COFE, show an increase in efficiency of 30 percent to 40 percent, the company said. COFE lets retailers manage omnichannel selling – when customers buy items online or in stores and can return items by shipping them back to the warehouse or taking them to a store.

Vargo does not disclose client names, but said “the four are comprised of three high-profile fashion retailers and one high-profile big box retailer.”

We heard from Art Eldred, client executive, systems engineering for Vargo Material Handling on COFE.

What is it exactly about COFE that makes these operations more efficient? Would items be sent to the wrong place otherwise? COFE is fast, and it works in a continuous flow, enabling workers to continuously pick orders, regardless of where the merchandise is going (to a customer’s home or a to a store). COFE knows where the inventory is located in a fulfillment center. It knows where the workers are, and it makes real-time decisions on which workers to send an order to. COFE also prioritizes orders to meet customers’ demands to order something today and get it tomorrow.

So, for example, if an overnight order came into a COFE-managed distribution center two minutes ago, that order would move right to the head of the line, ahead of orders that don’t require overnight shipping. If that overnight order was not prioritized through a system like COFE, it might have to sit through a batch of other orders that don’t have as high a priority.
It is built to allow a distribution center to pull hundreds of thousands of items to fill thousands of orders (direct-to-customer, for example), versus pulling hundreds of thousands of items for a few orders (for shipping large amounts to a store, for example).

It’s not that traditional warehouses would send things to the wrong place. They just cannot operate as fast and as efficiently as one equipped with a warehouse execution system like COFE, which manages everything with one engine, one work force and one inventory. COFE also allows distribution centers to use one inventory, one distribution center and one work force to fill direct-to-customer orders and store replenishment orders (called omnichannel because it is filling orders that go to different channels, customers and stores).

The system can do this with a speed and efficiency that allows retailers that have brick-and-mortar stores but are now wading into e-commerce territory to compete effectively in an Amazon-like world – again, one where we are used to ordering something today and getting it tomorrow.