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Warehouse Optimization: How to Improve Warehouse Efficiency

Posted by Chuck Torrens on Jun 6, 2018 2:20:00 PM

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Since 2010, the number of warehouses in the United States has risen 6.8 percent. Clearly, warehouse management is becoming more important to many businesses and to the economy in general.

And you know that a seamless flow of products through your warehouse is critical to business efficiency. However, common issues such as inventory inaccuracies, poor space utilization, unnecessary manual processes and picking inefficiencies can cause major workflow slowdowns.

Here's how to stop these problems and start your warehouse optimization initiative.


Read the Guide: 9 Ways to Reduce Warehouse Management Costs


Know Why You Need to Improve Efficiency

Before you adopt new systems and practices, consider the reasons you need to improve efficiency.

  • It could be pressure to provide the same service in a more efficient manner.

  • Perhaps the benefits if improved efficiencies could be passed on to the end user, which would make you more competitive in the market.

  • Or maybe you need to help your department avoid increased costs of output. For example, if your company projects a 20 percent increase in volume next year but wants to avoid capital outlay or hiring more labor, you must enhance efficiency.

When it comes down to it, warehouse optimization is almost always intended to drive up profit margins and to keep prices competitive — both of which could help retain current customers and attract new ones.

Automate Carrier Service Comparisons

It can be difficult to know which shipping carrier offers the best possible service and rate for each particular order. Calculating these factors manually is not only time-consuming, but possibly inaccurate.

Instead, automate the task with software. Order fulfillment software can instantly suggest the ideal shipment options, so choosing the best carrier is as easy as a click. The benefits of an appropriate shipping software program are tremendous.

The task of choosing a carrier and getting your product out of your warehouse and to your customers can be accomplished instantly without any labor involved, thus saving money and time and increasing your bottom line.

Additionally, you'll eliminate the opportunity for human error due to the fact that the process has been automated.

Move to a Multicarrier System

If you are using multiple carriers, move to a multicarrier system. This unifies all of the shipments in the same system. You don't have to route product to different workstations based on how a certain order is going to ship.

By unifying the process for all carriers, you can arrange warehouse workflow in a way that optimizes your operations. Also, you don't have to learn different systems for different carriers.

Just make sure the multicarrier system integrates with existing operations (warehouse management system, order fulfillment system, ERP, etc.). This will streamline the fulfillment process and offer a high level of automation to the overall process, as well as to the shipping job.

For example, if the system is integrated with order management software, you can retrieve all the info about an order simply by scanning a barcode.

Integrate Shipping and Packing Processes

Traditionally, warehouses have distinct packing and shipping stations. The model is that the order first comes to the packing station, and then it's sent along the conveyor to the shipping station (where it's shipped). There is no reason why these two tasks can't be integrated into one.

The benefits of doing this include:

  • You use less labor.

  • You streamline the fulfillment process.

  • You free up warehouse space, which allows you to handle more volume.

Going Forward

From automating and integrating processes to adopting new technology, there are numerous ways to get warehouse optimization underway.

When deciding how you can optimize the operation, list all your processes and methodically analyze each one.

Determine if that part of the operation is required, and if so, ask why it is. Also, examine whether each necessary part can be done more efficiently.

Employing these practices is a great start. There is a constant cycle of warehouse optimization inherent to any successful business. As you move forward, evaluate how your productivity and efficiencies are improving.

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Topics: shipping costs