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Why Warehouse Operations Often Struggle

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StrategyDriven Tactical Execution Article |Warehouse Operations|Why Warehouse Operations Often StruggleYou will find that many organizations struggle when it comes to warehouse management. The warehouse is an area of the business that has a massive impact on the success of the company and customer satisfaction levels, but it can also be challenging to thrive because it can be a complex operation with a lot of constant movement. This means that there are often inefficiencies here, but this also means that there are often improvements that can be made. This article will outline a few of the main reasons why warehouses struggle and will provide a few ideas for improvements that should help.

Unmotivated Workforce

One of the primary reasons why warehouses struggle is that the workforce is not motivated. You could have an efficient system in place, but if your team does not work to a high standard each day, then it will be impossible to succeed. Therefore, you need to keep your team motivated with decent pay, a relaxed yet productive work environment, goals and incentives, and career development opportunities.

Inefficient Layout

Many warehouses have the same layout that they did when they first started, which can cause inefficiencies and make work harder than it needs to be. You should not shy away from trying a new layout, as you might find that you can speed up operations and get more done each day.


Lack of Speed

These days, many warehouses struggle when it comes to speed and find that they are unable to meet consumer expectations. Consumer expectations have risen with next-day delivery becoming the norm. It is challenging to increase speed, while still maintaining accuracy and safety, but you will find that it is possible and often this is through automation. A warehouse management system, that integrates with your shipping systems, conveyors, and ERP can help you to speed operations up and keep your customers happy.

Out of Date Equipment

Another common reason that warehouses struggle is the equipment that they use. Forklifts are one of the best examples of this as this is equipment that is used constantly throughout the day, so you need to have the very best forklifts to succeed. Forklift hire is smart because you are not tied down and you can upgrade to the latest and best forklifts when they become available, and this should make a big difference to the daily performance of the warehouse.

Lack of Data

These days, all business operations should be utilizing data, but it is sometimes lacking in warehouse operations. Data can provide a deep insight into the daily performance of your staff members, teams, and the entire warehouse operation, which will allow you to identify the best ways to improve and become more efficient.

These are the main reasons that warehouses struggle. It is a difficult area of the business to manage with a lot of moving parts, but it is also an area of the business that has a massive impact on your success and customer satisfaction levels, so it is important to address these areas.

5 Golden Rules for Managing Business Logistics

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StrategyDriven Tactical Execution Article |Managing Business Logistics|5 Golden Rules for Managing Business LogisticsManaging your business gets increasingly more difficult as you scale it, Thankfully, there are plenty of ways to ensure that your company stays organized as long as you adopt some golden rules to help streamline your workflow and logistics processes. So in this post, we’re going to talk about five important things to follow.

1. Proper planning is mandatory for an efficient logistics system

Before you make any sweeping changes to your business, it’s vital that you plan out all of your actions to ensure that you’re not missing anything and that you’ve included everything that is a part of your logistics chain. Planning is important because it allows you to get a better overall view of your business’s current logistics system, giving you a better look at the areas that need to be optimized and where you can maximize your profits.

However, what’s arguably more important than proper planning is the ability to prepare for any potential situations where your plans don’t work. Unforeseen circumstances aren’t uncommon regardless of the type of business you operate. Whether it’s a problem with your products, adverse weather conditions, transportation issues or even internal organization problems, you need to have contingency plans in place for when things go badly.

2. Focus on building solid relationships with third-party services

While you might manage most of your general logistics chain, there’s undoubtedly going to be areas that you need to rely on other companies–at least for now. Everything from outsourced drivers to a pallet delivery company can be considered an essential service for smoothing out the bumps in your logistics chain. In some cases, you might even need to rely on a warehousing service to help you store excess goods as you grow your company’s storage space.

However, if you find that you’re constantly forced to use external employees to help, you might find it more convenient to hire new staff instead as long as the cost of recruitment and training can offset the current cost of hiring temporary workers. Eventually, you’ll want to manage virtually every aspect of your logistics chain so that you have more control over it, but until then, it’s perfectly fine to rely on outside services.

3. Efficient warehouse management is the key to a well-oiled logistics system

Proper warehouse management, such as indexing of items, can help a considerable amount when it comes to optimizing your logistics system. This is especially important for companies that typically deal with items that are perishable, such as food items that need to be refrigerated. The capacity of your warehouse should also accommodate your needs. This can be difficult to measure unless you’re actively monitoring every aspect of your logistics chain, hence why analytics and accurate reports can be important.

Warehouse management also means having enough workers and equipment to store and retrieve orders as needed. This includes having staff that are knowledgeable of all the safety considerations of working in a warehouse, and also having access to forklifts and similar pieces of equipment to make their life easier.

4. Use automated processes to become more efficient

Whether it’s organizing goods or printing labels, automation can make your logistics chain a lot simpler to manage. With the right type of software and engineers to monitor and tweak it, automated processes could play a major role in the way you operate your logistics.

Automated tools are usually always a big help, but it’s worth remembering that they can be difficult to set up and are usually prone to problems. Make sure you do your research and trial any piece of automation technology you use before putting it into service.

5. Analytics will help you get an objective look at your logistics chain

We mentioned this briefly already, but having analytical tools to track different metrics is critical to the operation of your business. Warehouses benefit greatly from using analytics because it allows you to make informed decisions backed by real statistics and facts that you personally generate. It allows for smarter inventory management, it helps you expand when needed and it also works well with complex supplier networks.

In addition, analytics can also help you react to certain situations. For instance, if there’s a supply chain issue like a truck getting stuck in transit, then you’ll immediately notice there’s an issue. Using your analytical tools, you can make decisions on how to proceed. This can be done by examining current stock, how much the truck is carrying and also how long your current stock will last. You can even track financial objectives to see if you’re meeting your targets.

8 Easy Ways Any Company Can Improve Inventory Management

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StrategyDriven Tactical Execution ArticleProper inventory management is one of the keys to keeping your business running smoothly and remaining profitable. Make mistakes here, and you may run out of best sellers, buy products you don’t need, and waste resources you can’t afford to lose. Here are eight essential inventory management tips every business should follow. We’ll focus on universal advice that almost any firm can implement.

Manage Inventory via Software

Don’t rely on spreadsheets to track software. Spreadsheets can be deleted. Cell values could be deleted or overwritten. Formulas may be altered, scrambling values elsewhere in the spreadsheet.

One of the best ways to manage inventory is by using software designed for this task instead. The ideal case is switching to inventory management software that integrates with your accounting system. Then the inventory is automatically updated as you sell items or buy more. That is why a QuickBooks Inventory management tool is invaluable – it is already tied to software you already use. QuickBooks lacks serial numbers, scanning barcodes and shipping. An inventory management tool can handle all of this. There are several tools that will allow you adjust stock levels in inventory checks and automatically remove inventory from stock when you receive orders so you don’t accidentally sell more than you actually have on hand. They will also help you track items reserved for sales orders and you can track inventory status, such as when you’re waiting for products to arrive so you can fill outstanding orders.

Have Clear Product Names

If you want to avoid problems with customer orders and internal inventory management, have a clear product naming system. You could use manufacturer part numbers, though this may be confusing if different manufacturers use similar part numbers for very different products. The ideal situation is creating internal part numbers that make it very obvious what someone is picking up. Instead of CRAY008 and CRAY016 for crayons in boxes of 8 and 18, label them “crayons, set of 8” and “crayons, set of 16”.

Set Minimum Stock Levels

Nearly every inventory management system allows you to set minimum stock levels, and most have reorder points. This ensures that you won’t run out of items. The best inventory management systems allow you to calculate reorder points based on historical data so you can order items based on how quickly you actually consume the product. You can still set low inventory alerts to ensure that you never run out.

Implement FIFO

FIFO is first in, first out inventory management. This is one of the oldest inventory management techniques, and it remains one of the most popular. A major reason of this is that it minimizes spoilage and the associated waste, since you’re selling the oldest items first. This isn’t limited to perishable goods that can spoil; it is applicable to other products, as well. Move your oldest products first so that they don’t become obsolete due to changes in packaging or industry standards. It simply requires setting up inventory so that the oldest items are on the front of the shelf and picked by employees, though you’ll want to train people to check expiration dates. You’ll also have to train staff to ensure that the FIFO system is properly maintained, instead of someone hurriedly stocking the front of each shelf with the newest products.

Keep the Warehouse Organized

If the warehouse itself is disorganized, how can you reasonably expect your staff to keep your inventory organized? Don’t let crates of packaged inventory pile up in aisles; have them immediately emptied and the shelves stocked. Keep work surfaces as clean as possible. Make certain that items are clearly labeled.

Also, make sure that you have formal processes for each task. Document how people perform tasks like placing purchase orders, receiving items, fulfilling orders and checking stock levels.

Do Regular Checks

Inventory management systems don’t eliminate the need to do inventory checks. People may make mistakes when checking in deliveries or in their data entry. Theft, spoilage and property damage may erode your inventory, too.

There are two main ways to check inventory. One way is with a complete physical inventory – checking all inventories – usually done at the end of the month. The other way is with cycle counting, counting small sections of the inventory on a particular day. You can mix and match with these tactics, such as doing surface area cycle counts for particular aisles in the warehouse each day but checking large physical item inventory every quarter or year.

Prioritize with an ABC System

An ABC system allows you to prioritize inventory checks and product maintenance. The “A” items are high value items that have low turnover. “B” items have some value and sell at a steady rate. “C” items have low value but sell in large numbers. “A” items should be checked for spoilage, maintenance and theft regularly, since you have so much money tied up in them. “B” items are a lower priority, since they don’t cost you as much but do move steadily. “C” items require little attention since they move quickly and cost very little, though you’ll want to make sure you have enough in stock.

Only Order with Purchase Orders

Only place orders via purchase orders. Don’t let employees place orders over the phone with your vendors. They may order items you don’t really need or can’t afford to buy at this point. By requiring people to order via a purchase order, it forces every purchase to be checked against inventory levels and the budget. No one orders an item that’s already on its way from the supplier. It creates a paper trail so that no one is surprised by a delivery of widgets. There’s no confusion regarding the payment terms or rush to figure out how to pay for something that just hit the dock. It ensures that inventory knows when to expect delivery and gives management a chance to negotiate purchase prices.

You cannot afford for the gap between accurate inventory numbers and bookkeeping to grow. This knowledge gap prevents your firm from being able to plan for the future or know the true state of operations.

A Must-Read Guide for Starting a Warehousing Business

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StrategyDriven Entrepreneurship ArticleIt’s common for both small businesses and independent contractors to have limited storage space for their products. To accommodate the growth of their business, they might turn to large warehouse facilities to house their ranges.

A warehousing business could potentially be a lucrative venture, but you’ll need to identify the products you want to store and the right building size for your needs. Below are some top tips for starting a warehousing business.

Understand Your Startup Requirements

Never enter a new business without doing your homework. Not only will you need to establish your startup costs, which can range from $10,000 to $50,000, but you must review the competition in your area. Review local business listings to see how many industry rivals you need to compete with. You should also visit their website to determine the various services they provide, target demographic, and price ranges.

Call Other Warehousing Businesses

Your local competitors will more than likely not be willing to share the key to success, or the common pitfalls they face. However, companies far away from your destination might be more likely to offer advice and tips on how to make your first venture work, so give them a call.

The Correct Licenses & Equipment

If you are confident you have what it takes to make a warehousing business work, you’ll need to register for a DBA (doing business as), which you can obtain from either your local county or city administration office. The good news is, this will only cost between $25 and $50.

Most of your money will be spent on your warehousing equipment, such as shelving units, crates, forklifts, and storage units (such as freezers and refrigerators). It’s also vital to invest in highly efficient LED lighting. A truck might also be an essential investment for your company’s distribution services, as it will enable you to deliver products locally to clients.

Purchase Inventory Software

Effective organization is an important element for a successful warehousing business. If you want to accurately keep track of every item in your warehouse, you must buy inventory software. This will monitor the entrance, product location, and exit of each item, so you’ll never misplace an item or cause a delivery delay.

Hire Your First Employees

Of course, you cannot run a warehousing business without employees. Improve efficiency and professionalism by hiring candidates who have extensive experience in logistics, if you plan to provide distribution services to your clients. They will be responsible for organizing shipping and tracking the products to a final destination point.

You must also hire a person to check items in as they arrive, set-up the product locations in the warehouse, and label sections from A to Z. Not forgetting you’ll need to hire staff to both lift and operate forklifts for picking.

Find Customers

To generate leads for your business, you should sign up to the International Warehouse Logistics Association. The local listing could help you to secure nearby clients to start storing your first products. You should also call local companies to promote your services and explain the key benefits of working with your business.

Running a Smooth Operation: Tips for a More Organized Warehouse

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StrategyDriven Tactical Execution Article
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Warehouses play a vital role in the supply chain and can, therefore, have a dramatic impact on your business’ bottom line. If your warehouse is an efficient, organized and well-oiled machine, your business will run more smoothly, and you’ll be able to make more money than it is a bit of a disorganized shambles. Unfortunately, it can be a lot harder to maintain a smooth running warehouse than you might think. If you’re struggling with this, check out these simple tips for a more organized warehouse:

Keep it Clean

Perhaps, the most important thing you can do to ensure that your warehouse is better organized and that it runs more smoothly, is to ensure that it is always clean. Ideally, you should do this by hiring a cleaner to come in for an hour or two each day to clear the clutter and mess and ensure that your employees have an easier time of locating items and moving around the space, unobstructed.

Install Warehouse Aisle Markers

Warehouse aisle marker signs are the first line in warehouse identification. Use them to mark where each of your products is located and it will speedup the process of your employees finding what they are looking for fast, and make the process of unloading simpler, faster and more efficient too.

Cut Down on Clutter

Reducing the amount of unnecessary clutter you have in your warehouse day to day will do more than almost anything else to help you maintain an organized space. Most warehouses have more bins, panels, inserts, and accessories than they actually need to get the job done, just lying around doing nothing, so remove them into a separate storage area for an instant organizational boost.

Adopt Slender inventory Practices

Maintaining a slender inventory means that you only ever stock exactly what you need to get the job done with no excess. Many businesses worry about doing this in case they get a sudden run on a certain product, but if you properly plan for demand and foster good relationships with your suppliers, this should not be a problem. Of course, having a small amount of safety stock is always sensible, but you should reduce this to the bare minimum if you want to run a really smooth operation.

Make Safety a Priority

A safe warehouse is a more organized warehouse, and of course, you don’t want to do anything that would put your warehouse workers at risk, so when you’re trying to make your space more streamlined, do so by placing containers, shelves, and products in the safest place possible. You should also aim to change the layout so that traffic patterns flow easily and that every inch of space is utilized effectively to make things easier on your staff and increase efficiency, which usually means that things are organized so that every member of staff has to walk the shortest amount of steps to complete their assigned task.

Monitor Inventory Error Rates

StrategyDriven Tactical Execution Article
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It doesn’t matter how organized and efficient your warehouse is, you are always going to experience errors in picking and packing now and again, and if you want your operation to be as smooth as it can be, monitoring your error rates can give you the insights you need to implement better strategies for error reduction.

Invest in Stackable Shelf Bins

Stackable shelf bins are great for increasing efficiency and improving organization when you’re dealing with small parts because your pickers can use them to quickly store and access parts that are in demand so that they can get to them faster for greater efficiency allover and fewer stressful moments.

Place Like Items Together

This should be a no-brainer, but so many warehouse operatives have like items scattered all over the place. This makes little sense because, having, say, all of your office chairs close by, means that your employees know, at least, the area they should be looking at to find that product, and because customers often buy several like product, which means it’s easier to fulfill an order when like products are stored side by side.

Implement Regular Training

Last, but by no means least, if you want to be as organized and efficient in your warehouse operations as possible, you should implement regular staff training days to ensure not only that  new employees know what they’re doing, but so that regular staff are kept up-to-date with latest practices and refreshed on old ones. You’d be surprised how much this can help.

Maintaining a smooth operation takes time, but if you implement these practices and stay up-to-date on the latest developments, you should have no trouble keeping your warehouse expertly organized.