Zenni Optical focuses on fulfillment center automation

With nearly 30% year-over-year growth, and labor and space variables constrained at best, this Bay Area company is keeping up with the pace through automation by way of efficient tabletop baggers.

Zenni Optical products
Zenni Optical products

The well-sighted among us may be blissfully unaware, but prescription glasses have long been an expensive but unavoidable necessity. This has been a pain point for consumers since the genesis of the prescription eyewear industry. According to Sean Pate, marketing VP, Zenni Optical, glasses simply never underwent price optimization as a commoditized item. There’s quite a bit of margin built into the traditional brick and mortar retail optometrist, and even discounters like Lens Crafters or Costco sell most pairs of glasses well into the three-figure territory, north of $150.

Zenni Optical was born in 2003 when its founders identified the outlandish difference between manufacturing cost and unit price among existing prescription eyewear channels and sought to inhabit an as-of-yet unoccupied niche. The result was a volume-supported direct-to-consumer model with low entry prices. The entry price for prescription glasses is $6.95, and the average checkout for a customer buying a pair of glasses is $40.

“The company’s ethos is rooted in seeing that people are being, effectively, ripped off in paying for prescription eyewear,” Pate says, “The cost in making those goods is nowhere near what the cost is that’s passed on to the consumer. There’s sometimes a 10x markup or more. That means that many people are simply denied access; price is a barrier to being able to see.”

Genesis and packaging
Zenni spent its first decade on a shoestring budget with little to no marketing, developing a vertically integrated manufacturing and supply chain that’s not beholden to any of the industry giants that exist today. With that supply chain firmly established after 15 years, the company has only recently been earmarking budget to marketing, making a splash by being the first optical industry brand to sponsor an NBA basketball team and have its logo appear on gameday jerseys--also the first logo on a Chicago Bulls jersey. While a certain type of customer had found and used Zenni over the years and there has been an organically cultivated customer base, this recent plunge into marketing has the company growing at a 25-30% pace, year over year. At its current pace, that equates to 10,000 to 15,000 individual packages per day.

The direct-to-consumer e-commerce model was a key in controlling costs from the get-go, eliminating brick and mortar retail altogether. The roughly 2,500 styles of frames, and all applicable prescription lenses, are manufactured to order in Zenni’s manufacturing facility in Danyang, China, then shipped via UPS air freight in 500-count corrugated shippers to Zenni’s San Francisco Bay Area fulfillment center. Each pair of glasses carries a unique identifier via barcoded order number throughout the process, so the order can be tracked and traced through the entire supply chain. An order placed online in the States triggers a specific style and prescription to be produced in Danyang, which is then shipped via bulk corrugated case to the San Francisco fulfillment center. There, glasses are placed into durable plastic glasses cases, then pouched and labeled. The barcode stays with each pair of glasses in the case for reverse logistics and return purposes.

Fulfillment for Zenni had long meant manual pack stations with an operator picking the frames from the shippers, scanning the frame’s barcode to identify and match with a mailing label, hand-packing first into the glasses case, then into hand-sealed bubble mailers before hand-labeling with a separate pressure-sensitive shipping label. But according to Simon Goh, Shipping Manager at Zenni, the company has been facing the same dearth of capable labor other industries have encountered. Given its NorCal address, space is at a premium at Zenni. And when volumes are going nowhere but up, the cost of secondary packaging material for shipping goes from negligible to having a big impact on the bottom line. Considering all of these factors, Zenni turned to automation to manage the skyrocketing growth.

Fulfillment center automation
Goh attended PACK EXPO Las Vegas in October of 2017 to research automated bagging systems. There he was introduced to PAC Machinery and Sharp Packaging Systems by Pregis. Goh initially purchased four SX automated poly bagging machines from Sharp. He then purchased a single Rollbag R1285 automatic bagger from PAC Machinery, and is in the process of adding three more, so the fulfillment center will soon contain eight total automated pack stations with tabletop baggers.

“The pneumatic heat seal produced on the PAC Machinery bagger, which creates a comparatively thick seal with high integrity, is what drove us to add more of the PAC machines,” Goh says, adding that he’s had good success with the Sharp machines as well.

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