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When one thinks of warehousing, the mind immediately conjures up visions of a neatly stacked go down with everything in its place and a place for everything. Or, one might conjure up images of a messy warehouse. But there is more to warehousing than just neatness or tidiness. Good warehouse efficiency is also about getting products out on time, maximizing productivity, and saving time and money.

An efficient warehouse leads to the success of the company, and warehouse managers make it top priority to find ways to enhance warehouse efficiency. Here are six essential functions that improve warehouse efficiency.

1. Reviewing effectiveness

The first step would be to review the current state of your warehouse and its current effectiveness – this includes a review of all warehousing processes such as receiving goods and putting away of goods, picking of goods – both primary picking and secondary picking, packing, dispatching, returns, and value-adding.

Within each of these processes, there are subprocesses that must be analyzed as well. For example, the subprocesses of the “packing” process would include picking and tracing goods, checking for accuracy and QA checks, picking goods from different zones in the warehouse, packing goods according to size, quantity, toxicity, temperature, fragility, hygiene, or value, and traceability of consignments. When reviewing the current effectiveness of your warehouse, the following aspects of each warehousing process must be considered:

  • What are your available resources?
  • Are the available resources used to the maximum?
  • Is there a seamless flow of goods into and out of the warehouse?
  • Are there any inefficiencies within the current chain?
  • If there are inefficiencies, how are these inefficiencies negatively impacting the entire process?

2. Forecasting

Forecasting the requirements of goods before they are ordered for will help ensure the warehouse is stocked with those goods before orders come piling in. Most businesses have certain periods of the year, which attract an increased demand for certain products. For example, Christmas and valentine’s day. Goods that are often in high demand are the latest toys or jewelry. During the period close to Valentine’s day, chocolates, jewelry, and lingerie might be in high demand.

A business software system that has a demand forecasting feature can predict a pattern in the sale of certain goods based on previous years’ data, well before peak season hits. So, you can stock up on hot-selling items and probably get rid of goods that don’t sell well during certain times of the year. This way:

  • You have more space for fast-moving items.
  • You can store up on fast-moving items.
  • You have a good stock of items that are in demand.
  • You can ensure goods go out and are delivered on time.

3. Training staff and frontline managers

At the end of the day, your company’s warehousing is as good as its staff. Well trained staff will increase warehouse efficiency. Develop effective and efficient frontline managers. Managers must be properly trained in understanding the trigger points for warehousing efficiency. Training must be made an ongoing process with regular refresher courses conducted.

Also, training must be conducted when new technologies are introduced to any of the warehousing processes. Feedback is also an important part of training wherein managers and employer share their views and thoughts on current warehousing processes and ideas to increase the efficiency of those processes.

4. Optimize labor efficiency

Another way of increasing warehouse efficiency is to optimize labor efficiency. Better and more efficient plans can be created based on an analysis of material usage patterns. High-volume items can be stored near the front of the warehouse to save on travel time. You can also store frequently bought items together. All these little functions will go a long way in streamlining operations and ensuring avoidance of delays.

5. Adopting efficiency-enabling technology

Warehousing is made up of several processes that can be managed by a warehouse management system (WMS) or an ERP system. A warehouse management system can improve overall warehouse efficiency by:

  • Suggesting the best routes to delivery locations
  • Suggesting the best method for picking up goods.
  • I am suggesting the best method for putting away goods.
  • Providing automated pick lists that help eliminate mistakes and reduce paper wastage and time wastage.
  • Providing improved accuracy of transactions through radio frequency identification (RFID)

6. Introduce incentive pay

Productivity is an essential part of warehouse improvement. The more productive your employees are, the more efficient your warehousing. To ensure your employees perform their best, introduce a properly engineered incentive pay. Since over 50% of warehousing, labor is in pick and pack; you can start your incentive program there. Do not pay for products that you are already getting or for productivity you can get by other ways. Instead, pay for performance targets met.

An automatic data capture and identification (AIDC) system can help improve efficiency by proving a reliable date through which incentive programs can be monitored and adjusted so that they are not only achievable but also safe.

So, there you have it – 6 basic functions that can lead to warehouse improvement and warehouse optimization. At the end of the day, you will find that warehousing and increasing warehouse efficiency is much about commonsense as it is about fancy algorithms that tell you what to do to improve warehouse efficiency. If you follow these basic functions, you will soon find warehouse improvements occurring in leaps and bounds.

Additionally, here are Effective Methods of Optimizing Warehouse Storage.