How to manage an effective warehouse

Smart businesses run efficiently. The less time and effort that's wasted getting a task done, the more healthy the bottom line will eventually look. That goes for all processes, and your warehouse is no different. Just because it's big and full of boxes doesn't mean it can't be fine tuned into a slick operation.

The first thing you'll want to get right is your floorplan. Ideally, this is done at the very beginning, but even if you're already running a fully operational setup, the potential efficiency savings could mean that rearranging your layout is still worth considering.

Matt Grierson is managing director at Dexion, which provides industrial and commercial storage solutions across Europe. He says that only a small fraction of the companies that approach him believing they need to move into larger premises really do need to. The rest have enough space already, they're just using it badly.

Grierson says: "Inefficiency just happens. You start with a big empty shell that's high and deep and you slowly begin to fill it as your company grows. Most of the company's efforts are concentrated on generating sales, naturally, and the warehouse gets forgotten. Before long, your warehouse is full, but it's wasted space and you've got a lot of unused potential."

By using your space efficiently, your staff can get jobs done quicker and can complete more jobs in a day, you save on purchase or rent by not expanding unnecessarily, and you can go longer before the huge burden of relocating into bigger premises.

Grierson adds: "There are a lot of shelving options. Two-tier or mezzanine, fixed or mobile. If you can squeeze your rows of shelving together, and only open them up when access is required, you can save 50% of your floor space."

One of the most commonly overlooked aspects is product placement. Grierson says: "Is your number one product the easiest to get to? If your pickers are regularly travelling the length of the warehouse to get to your biggest sellers, you're wasting time compared to keeping everything nearby."

Successful warehouses often employ full-time warehouse managers, but professionals can be hired in to assess your requirements. Dexion offers a simulation tool, which tracks all movements and gives insight into who is travelling where, what's most popular and what changes would improve efficiency.

Once your goods are in the optimal location it's important to keep detailed records with a good inventory control system, which is a process for managing the location, stock on hand and movement history of all items in the warehouse.

Graham Jones, logistics manager of parcel delivery service DPD, says that good warehouse organisation increases your capacity to process the company's input and output, and in turn, your revenue potential. A solid working environment with minimal waste will also help motivate your workforce, and working more accurately keeps customers happy.

"All warehouse operations strive to achieve the highest levels of inventory accuracy," he says. "The simple principle is that all physical movement or change in status of an item must be reflected in a transaction on the system. The transaction must be time- and date-stamped and referenced to the request that generated the movement.

"To assist operatives in achieving the level of accuracy required, the use of barcode and radio frequency identification technologies provide a quick, simple and accurate way of identifying products and creating stock-movement transactions on the system.

"Operatives also benefit from the ability of the system to optimise both their route around the warehouse when carrying out stock put away and order-picking tasks and the location of products based on usage, size and so on to provide the most efficient stock-location layout."

And even once your warehouse layout has been optimised, and all stock location and movement is tracked in detail, there is further technology available that speeds up the work of the pickers.

Birmingham-based Connect Distribution Services Ltd installed a voice-directed system to help speed up its warehouse performance. Within the first year, the warehouse had improved efficiency by as much as 40%, and by increasing its use of the technology into other areas, is now seeing gains of as much as 85%.

The domestic appliance and parts distributor holds approximately 100,000 product types on site and has access to around 1.5 million lines. The firm is based at a six-acre national distribution centre which processes over 180,000 orders on average per month.

To service the demand of the e-commerce boom, the company expanded its floor space and recruited more staff. In addition, it added VoiteQ's Vocollect Voice technology, including headsets for pickers, and linked it to a custom built warehouse management system.

The system services up to 14 orders within a single route. Items are placed into a box that then passes by a barcode reader, automatically diverting it to the next relevant picking zone. This in turn updates the system and instructs the picking to take place via a voice command.

The system used at Connect Distribution has been configured to operate by priority, automatically directing the picker to the most urgent pick and enabling the company to fulfil a high volume of next-day deliveries.

Iain Priestley, director of the national distribution centre operations, says: "Initially, our pickers were a little concerned that they wouldn't be able to adapt to the verbal instructions. Yet, within just a few days, everyone had increased the speed setting they receive from the voice commands. After two weeks they were working at the fastest setting.

"Voice has undoubtedly become a mainstream warehouse technology, yet in our relatively traditional industry, implementing it has given us an edge compared with other distribution companies. Crucially, it has enabled us to deliver a higher quality of service and fulfil the high degree of same-day dispatch orders we receive."

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