Tips for Improving Warehouse Efficiency

Lean warehouse operations open up a range of areas ripe for significant, long-term and sustainable savings

“Lean warehouse operations open up a range of areas ripe for significant, long-term and sustainable savings.” ~ Four Principles Management Consulting

1. Adopt lean warehouse operations practices. “Warehousing has evolved enormously from its historical roots as the simple storage of goods. Now, in an increasingly globalised marketplace, high-level inventory management, rapid receiving and shipping dock management and accurate, flexible pick and pack services have never been more important.

“Lean warehouse operations open up a range of areas ripe for significant, long-term and sustainable savings. From reduced handling time and reductions in loading/unloading times of trucks and containers to increased reliability and sharing of information and greater flexibility to adapt to changing market conditions of customer specifications, lean brings about a sea change in the warehouse mindset. With improved picking and packing processes, less time is spent looking for or checking inventory, stock replenishment is concise and reliable and lost sales opportunities are minimised.” – Lean Warehouse OperationsFour Principles Management Consulting

2. Avoid procrastination when receiving shipments. “Sometimes when you receive major shipments from suppliers, it’s easy to give it the ‘ol, ‘Eh. Let’s just take care of this later.’ Put an end to the procrastination and take the time to breakdown the boxes, shove them in the recycling bin, un-package your products and stock them accordingly. This is a habit you must commit to. If your shipment comes around the same time each day/week, then schedule it on your calendar. Putting it off will only allow it to become an even larger beast, waiting for your attention.” – Breena Fain, 6 Ways to Optimize Your Warehouse Management SystemStitch Labs; Twitter: @StitchLabs

“Implement thorough training programs that focus on technology and how you want employees to utilize the tools you’ve provided.” ~ Freight Cowboy

3. Conduct thorough employee training. “Even the most effective technologies and processes lack value if your employees don’t understand them. Implement thorough training programs that focus on technology and how you want employees to utilize the tools you’ve provided. Education and training should prioritize safety, and encourage innovation.” – The 5 Best Ways to Increase Warehouse EfficiencyFreight Cowboy; Twitter: @freight_cowboy

4. Create omni-channel fulfillment centers. “For some companies looking for omni-channel fulfillment efficiencies, the trend has been to move away from DCs dedicated to a single channel and instead have DCs that fulfill orders for multiple channels, says Ian Hobkirk, founder and managing director of Commonwealth Supply Chain Advisors.

“‘Ten years ago when e-commerce was still fairly new, you had a lot of channel separation in the way companies set up and run DCs, and e-commerce fulfillment, in many cases, was outsourced to a 3PL,’ says Hobkirk. ‘One of the trends we’re seeing now among retailers is to have multi-channel fulfillment centers in which inventory and fulfillment for all channels is under the same roof.’

“The key driver for an omni-channel DC is the benefit it has on inventory—having one pool of inventory that can be used more flexibly to accommodate forecast deviations. ‘There are other factors driving omni-channel fulfillment centers, such as the lower costs from being able to use a common pool of labor, but it’s the inventory factor that’s truly driving this trend,’ says Hobkirk.” – Roberto Michel, Warehouse/DC Management: Six Best Practices for Better Inventory ManagementLogistics Management; Twitter:@LogisticsMgmt

“Any inefficiency within the chain will impact negatively throughout the whole process. Quite often this means that to resolve a problem in the system, the whole system has to be reviewed.” - Vero Solutions

5. Review effectiveness. “You can’t improve something that you haven’t actually analysed. It is important to gauge if you are using your available resources to the fullest. Is there a flow of goods in and goods out? Any inefficiency within the chain will impact negatively throughout the whole process. Quite often this means that to resolve a problem in the system, the whole system has to be reviewed. It’s no use enforcing a new system in one area if something else isn’t working correctly.” – 8 Tips to Improve Warehouse EfficiencyVero Solutions; Twitter: @solutions_vero

6. Understand how to organize your inventory. “Many aspects of your eCommerce business may feel intuitive to you. You may have a great head for business or be skilled at organizing your workflow. When it comes to managing your inventory, however, throw intuition out the window.

Most businesses initially stored their inventory like with like. You line up one dress with small, medium, and large on one shelf. You put another dress on the next shelf. This is the logical way to organize our closets.

But your pick and pack methods will work better when your inventory storage isn’t organized this way. When you line up all the yellow dress sizes together, you might grab a medium when you need a large. If you don’t catch it, you’ll have an unhappy customer.

To move fast, you need to introduce chaos into your inventory management.” – Jake Rheude, Pick and Pack Fulfillment Services, Red Stag Fulfillment; Twitter: @RedStagFulfill

7. Run an audit of your warehouse. “The first step is to transform your space from an inefficient to an efficient warehouse. That starts with conducting an operational audit. See how long it takes for processes in your supply chain to be completed. Ask yourself: Are my goods organized in a way that makes sense? Is order picking going as fast as possible? If you are not well versed in how to deploy a warehouse audit, then you need to hire someone you can. That’s where an efficient warehouse manager comes into the picture.” – Warehouse Efficiency: 9 Ideas to Improve ProductivityDefinitive Technology Group; Twitter: @definitivetg

“By requiring appointments and information about incoming loads, surprises are minimized.” - Exceed Consulting

8. Schedule vendor receiving appointments. “An easy way to help minimize surprises and plan your dock staffing is to require all inbound carriers to schedule delivery appointments. There are two different methods to schedule and they can be used concurrently.

“The first method is to simply assign each carrier or delivery a specific time or window of time to deliver. The second is to assign either a specific or recurring daily, weekly, or monthly schedule to arrive. This allows you to schedule staff accordingly and make the best use of your dock.

“Vendor receiving appointments are absolutely critical if you share a dock or ship both inbound and outbound out of the same area. Any advance paperwork or data should be provided before the delivery is made. By requiring appointments and information about incoming loads, surprises are minimized.” – Back-to-Basics Part 1: ReceivingExceed Consulting

9. Use ABC Analysis to prioritize items. “ABC is a hierarchy of your most valuable items to the least (by dollar value). This is also referred to as the Inventory Categorization Method. Since you may not value your entire stock equally, this control will have you focusing your time and resources on items that make you the most money.

“A- items are big-ticket or priority stock. These goods require tighter controls and monitoring since they are your largest revenue and cost contributors. Due to their costs, you would most likely be carrying smaller volumes on hand. Since these items are heavily sought after, they should be stored under ‘lock and key.’ In addition to security, A-list products will require higher frequencies of stock reviews and re-ordering. This ensures that you have adequate supply.

“Conversely, C-items have lower values but you may be carrying large volumes of them. For example, if you owned a hardware store, nails in bulk may be considered a C-item. B-items sit right in the middle for value, volume, frequency of stock reviews and re-orders.” – Colleen Rodericks, Inventory Management Techniques and Best PracticesinFlow Inventory; Twitter: @inFlowInventory

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