For many companies, the warehouse is a significant cost factor. It is essential to make sure that the warehouse is organized efficiently and used correctly. This is why warehouse management is such a crucial part of your business. The Expert Market website has some fundamental guidelines. Managing your warehouse and dealing with inventory control are not easy tasks. But, with these tips here, you’ll be more educated on how to do it properly. Here’s how to maximize the efficiency of your warehouse.
Ask Your Suppliers for Several Small Quantities Deliveries
If your warehouse is too large, you’ll use more space than you need and tie up capital. The opposite is true. The shorter the time your goods or components remain between delivery and shipment, the lower your storage and capital costs. Talk to your suppliers to find out if goods can be delivered more frequently and in smaller quantities. Or arrange for just-in-time delivery immediately. This way, you can reduce stock levels and avoid bottlenecks in the event of unforeseen fluctuations in demand. Consistent delivery also has a lot of potentials: if you offer reasonable delivery times (and customers agree to pick up), it’s easier to manage staff and reduce costs.
Monitor Your Transportation, Shelving, and Staffing Costs
Check that costs are distributed correctly. A typical Euro pallet warehouse costs 20% in transportation and racking costs. Personnel and buildings each account for 40% of the costs. Your accounting department can give you an estimate of the current distribution of costs. If you find discrepancies, review the line items to determine potential savings.
Modernize Your Warehouse
Frequently used goods and components should be placed at the beginning or end of each aisle in your warehouse. Particular storage areas should be reserved for unusual sizes or compartments that are not standardized. Difficult-to-access storage areas, such as aisle columns, can only be used in an emergency. Upgrade your warehouse with taller shelving and new conveyors if necessary. This is often cheaper than renting additional space. Although cross-aisle storage may have a greater aisle width, longitudinal stacking is more efficient in daily practice.
Get Help From Your IT Department
Modern technology, such as warehouse radio, can make it easier to manage a more giant warehouse. The central computer automatically records new stock when new goods are put in or taken out of the warehouse. If you have buffer magazines installed on the machines, any changes in the warehouse are recorded in IT. This can reduce search time. IT can also display stock movements differentially. This ensures that items in a narrow area are always above those in the broader space.
If the same thing is stocked, the closest warehouse is determined according to a previously defined priority order (page level, position, or level). If multiple warehouses are possible, the closest one will be filled or emptied first.
Opt to Outsource Your Warehouse
Once you’ve identified all the possible savings, it’s worth considering whether you can outsource your warehouse even more cost-effectively. Many logistics service providers, who use efficient technology and are well organized, have modern high-bay warehouses. If turnover is subject to seasonal fluctuations, staffing costs are often negligible compared to the benefits of having your warehouse.
If your company is young and growing, outsourcing may be a good option. You can focus more on your core competencies, such as developing, manufacturing, and marketing your products. There is no need to plan in this area. A logistics company with sufficient capacity can help you increase your inventory when you need it.