Various factors can interfere with warehouse management operations, such as ineffective space usage, inventory miscalculations, and inability to keep up with consumer demand. Below are six common issues affecting warehouse management orders and operations, along with tips to overcome them.
1. INACCURATE INVENTORY
When warehouses manually update and manage inventory data, it can lead to inaccurate stock information and obsolete inventory buildup. In turn, employees spend unnecessary amounts of time performing physical checks and correcting errors.
Here are some indicators of improperly updated and maintained inventory records:
- Expecting to find a product in a certain location but it’s actually placed somewhere else.
- Trying to store stock but struggling to find a place for it.
- Accepting an order, then finding out later there isn’t enough stock to fulfill it, resulting in a backorder.
- Rejecting an order assuming there isn’t enough stock to fulfill it, then finding out later there is.
Manual checks can cause miss-picks and delayed shipments, especially if workers visit a location that doesn’t stock the product they need. These issues can also occur when storing products in an already full location. With growing standards and expectations from clients and customers — not to mention unsuccessful deliveries costing valuable time and profits — an automated inventory tracking system is more important than ever.
For instance, a solution might include a barcode scanner device that sends the information to specialized software, which stores and tracks inventory. This is incredibly helpful for supervising all inventory operations and logistics, ensuring timely deliveries, and minimizing human error, thus saving distribution centers from added stress, time, and costs.
2. INEFFICIENT SPACE UTILIZATION
An ineffective distribution center layout also interferes with deliveries and operations.
Just like inventory inaccuracies, a poorly organized storage center wastes time and revenue. The more time a picker takes to locate a product, the fewer orders they can fulfill. Without enough space, products continue to accumulate inadequately. This can result in work accidents, lost time searching for products, and diminishing merchandise quality.
Making the most of warehouse space, including storage systems, shelves, and selection routes, is essential to get items in and out efficiently. By optimizing layout and supply flow, staff and managers can better ascertain where products are coming from and going.
That way, they can reduce the risk of incidents caused by improperly stored products and traffic. They can also use their floor and space to store as much merchandise as possible.
3. IMPROPER LABOR MANAGEMENT
With various tasks like loading, product picking, forklift operating, handling materials, cleaning, and monitoring shipments, labor costs generally comprise 60-65% of the total warehouse budget. Managing an extensive labor force of associates and managers can be a challenge, especially with equipment expenses and availability to account for.
To make the most of the available workforce, warehouse managers should seek areas that could benefit from automated technology. They can start by reviewing all the tasks performed throughout the warehouse, then examining the systems and solutions they’re currently using.
They can then try to increase their usage by automating more tasks. Doing so can reduce labor costs and fulfill orders more efficiently. This is assuming the warehouse has enough employees to perform tasks that can only be performed manually.
By incorporating more automation for repetitive, tedious, and manual tasks, employees can focus on more valuable and strategic responsibilities. Automated tasks might include following digital paths through the warehouse or loading and unloading boxes, pallets, and other containers.
4. ADAPTING TO SEASONAL DEMAND
Variables such as weather, seasonal changes, economic cycles, and trending goods can contribute to product demand. While some goods experience the same demand year-round, others are more sought-after during specific seasons.
Demand fluctuations can present some challenges for distribution centers. They may experience lower overall sales during some months, while demand exceeds their inventory levels during other periods. They might not have enough products in stock to fulfill abrupt demands, or they may not know where to store them on such short notice.
Warehouse managers should prepare their facilities for this influx of orders and deliveries. While they can’t control shifting consumer demands, they should take the necessary measures to forecast them as much as possible. Being aware of demand changes and market trends can help managers prevent excess inventory, cut down storage costs, and avoid lost sales from a lack of inventory.
Here are some tips to equip a warehouse for particularly busy seasons:
- Use demand forecasting software. Implementing demand planning software can help warehouse teams determine which products they need during specific seasons and which ones they can cut back on.
- Communication is key. Distribution center managers should maintain strong communication with manufacturers, retailers, drivers, distributors, and any other team members. This ensures each group is up to date on demand patterns and can take the appropriate action.
- Sort through merchandise. Warehouse managers and staff should organize merchandise to push out seasonal products quicker. By storing these popular goods in the most convenient warehouse spaces, workers can easily pick them and put them away as needed.
- Use automated tools and equipment. Warehouse equipment like forklift trucks, pallet flow rack systems, and automated storage and retrieval systems helps ensure a more efficient flow during hectic seasons.
Ensuring a proper balance of supply and demand is vital for order fulfillment. By staying on top of market trends and demands, warehouse operators can order in-demand inventory early, properly store items, optimize the picking process, and adjust their transportation network accordingly.
5. FLAWED ORDER MANAGEMENT
Customers use various methods for product ordering, such as e-commerce platforms, company websites, and offline sales mediums. This can make order management a complex, time-consuming undertaking. Order management entails every process from the minute a warehouse receives an order, including:
- Accepting the order.
- Picking and packing the item.
- Transporting, shipping, and delivering the product to the customer.
- Handling a return or refund if necessary.
While order management is a crucial component of warehouse operations, it can also encounter many errors. A flaw in any of these steps can compromise the entire process, often requiring a complete do-over. That means the customer will receive the order behind schedule, or they may end up canceling it. Both outcomes result in lost time and money.
Manual order fulfillment management methods, such as pen-and-paper or spreadsheets, can result in errors and occupy considerable amounts of time. There may be issues with storage capacity, pickers may retrieve incorrect orders, or a customer could receive the wrong product.
To ensure a smooth process and successful outcomes, warehouses can benefit from effective order management systems. These solutions help manage each element of the process, from shipping to customer notifications to inventory management, saving substantial time and labor.
6. REDUNDANCIES
Distribution centers typically perform several operations per item, collectively creating workflows. However, an unorganized or inefficient workflow can result in different actions, like sorting and picking, being repeated unintentionally. This leads to increased labor costs and lost time.
Investing in automation technology can help warehouses eliminate obsolete or unnecessary steps. A modern warehouse execution system can automate redundancies in tasks like order picking.
For example, a distribution center might use a barcode device to scan already-picked products, notifying the employee of any duplicates. These technologies help increase speed and efficiency, ultimately minimizing labor costs and improving overall customer experiences.
Whether adjusting warehouse layout, ensuring a safe workplace, or protecting products from damage, various practices and strategies can improve distribution center operations.
1. IMPROVE LAYOUT OPTIMIZATION
In an attempt to create more space and better organize products, vertically structured facilities may be optimal. A vertical building doesn’t require additional land, which is why many distribution centers have opted to expand their storage vertically rather than horizontally.
This technique allows companies to increase their storage capacities and make their warehouses more visually pleasing. Another tip to enhance a warehouse layout is adjusting aisle widths. Warehouse aisles should be wide enough for workers to move through comfortably without compromising workflow efficiency. Forklift drivers and pedestrians should be able to pass each other safely and easily.
Distribution centers can also position fast-moving products closer to the shipping and packing areas. This technique can reduce cross-traffic and travel time.
