Less Waste, More Wins: Strategies for Efficient Warehousing

When companies think about efficiency in warehousing, their first consideration is likely how it can save money, which it does. But there’s much more to the equation than that. Efficient warehousing also generates less waste, improves workflow, and delivers better service to customers. By implementing lean practices like 5S, slotting optimization, and cross-docking, organizations can increase productivity, reduce errors, and operate more sustainably. The result is a stronger bottom line and better outcomes for customers.

Why efficiency in warehousing matters more than ever

Customer demands continue to rise, especially when it comes to delivery times. Two-day delivery expectations are now the norm, and 62% of customers are hoping for even faster. In that environment, every piece of the supply chain feels the pressure.

But warehousing efficiency doesn’t end with meeting customer expectations, and the pressures don’t either. A continuing labor shortage and growing real estate costs mean companies must do more with fewer people and less space. Wasted time, motion, inventory, and errors hurt both profit and performance. Lean principles are a solution, allowing warehouses to accomplish more with less.

Lean warehousing: A brief overview

What does lean warehousing look like in practice? It’s a combination of steps that help companies eliminate non-value-adding activities with a mindset on continuous improvement. Five key principles guide the process: value, value stream, flow, pull, and perfection.

When companies adopt lean warehousing principles, they target key waste categories, such as overproduction, waiting, unnecessary motion, excess inventory, errors, and underutilized talent. All warehouses, including B2B, B2C, and omnichannel, can target and accomplish warehousing efficiency through lean practices.

Proven strategies for waste reduction and efficiency

There are several proven strategies for achieving efficient warehousing. Companies can choose to apply any combination of the approaches, or go all in on all of them. Your options include:

5S System

5S stands for sort, set in order, shine, standardize, and sustain. Japanese companies created the system as a practice to help eliminate waste and defective products in manufacturing. Warehouses can make use of it, too, however. Applying 5S practices can lead to tangible improvements and cost savings. If warehouse efficiency is the goal, 5S is an excellent starting point.

Slotting optimization

When a warehouse aims to optimize slotting, it is looking to place products on shelves that allow for maximum fulfillment efficiency. To determine optimal slotting positions, a business calculates factors like weight and size, and places in-demand products in easy-to-reach locations. The result maximizes the warehouse’s available space and minimizes worker travel times.

Cross-docking

In today’s quick-turn environment, companies frequently turn to cross-docking, which provides an assist to waste reduction and efficiency. When products reach the warehouse, workers stage them on a dock rather than taking them into storage. A truck arrives, workers load it with the staged items, and the truck takes them to the next location. Products “crossed the dock” but never became part of the facility’s inventory.

Cycle counting

Efficient warehousing means having a firm grip on inventory. Cycle counting is the process of auditing the inventory to achieve accurate, up-to-date counts. Companies often compare their manual counts to the warehouse management software’s (WMS) counts to ensure accuracy.

Layout and design optimization

Companies can achieve efficient warehousing by designing a lean warehouse layout. To achieve this, companies must take careful stock of the types of products they store and move. The goal will be designing a set up that allows for maximal flow from receiving on through shipping. A lean layout eliminates wasted space and motion, often with narrow aisles, conveyor systems, and other automation.

Labeling and signage systems

An efficient warehouse is one that features prominent, clear labeling and signage. This reduces confusion and eliminates errors, allowing for free-flowing operations.

Results and ROI of efficient warehousing

When companies achieve efficient warehousing, they can expect a long list of benefits, often quickly and without the need for a large capex investment. Better slotting and lean layouts lead to time and labor savings, for instance. When a company practices cycle counting, they achieve tighter inventory control and thus experience lower carrying costs.

A reduction in errors and returns, which results from implementing the proven strategies listed above, is another benefit of efficient warehousing. A 5S environment leads to safe operating conditions and improved employee morale. Finally, by leaning out operations, companies position themselves for future growth with easy scalability.

WSI’s approach to lean operations

WSI understands the principles of lean operations and can apply them to each customer’s specific needs. By using both proven strategies and smart technology, WSI can tailor solutions that boost warehousing efficiency.

Part of WSI’s approach is cross-functional planning, which it can apply to layouts, inventory, labor, and throughput improvements. WSI executes at the facility level, providing frontline training and accountability for every aspect of operations. Services extend beyond the implementation of processes and tools, however, and include ongoing process improvement in keeping with lean warehousing principles.

The future of lean warehousing

Lean warehousing can be a powerful tool for change. As it evolves and as the industry looks to the future, businesses will increasingly support efficient warehousing with automation that boosts productivity, warehouse management systems analytics, and AI for optimized slotting.

Lean warehousing in the future will also include an increased focus on environmental, social and governance (ESG). Through lean warehousing practices, businesses will be equipped to meet their ESG goals, reducing waste in the system and providing a more sustainable model.

As the labor shortage continues, lean warehouses create a differentiator that helps with retention. The 5S approach, for instance, adds up to a cleaner, safer environment that makes employees want to come to work. Being part of a modern, efficient warehousing operation allows your company to stand out among the competition.

Lean warehousing isn’t a trend. It’s a foundation for competitive advantage that’s here to stay. Want to learn more about efficient warehousing and how to go about it? Reach out to WSI’s team to get started on your lean warehousing journey.