Efficiently managing a warehouse can be an overwhelming task. If you can relate, know that you are not alone. This article will address how a warehouse management system can help you manage your supply chain’s most common warehouse challenges.
5 warehouse management challenges
1. Warehouse layout
In order to effectively run a warehouse, space is imperative. When appropriately utilized, warehouse layouts can help your team do more with the space they have available. From receiving areas to storage, operations managers need to have a well-planned outlayout for their warehouse. This will help eliminate wasted time walking back and forth through the warehouse and keep staff moving faster with designated space for each area of the warehouse. It seems like a pretty basic concept but you would be surprised how many warehouses aren’t laid out for smooth order fulfillment.
Solution: implement a warehouse management system to address your current warehouse layout and how it can be improved.
Most warehouse management systems use scanner technology, which provides data on the flow of goods throughout your warehouse. Managers can use this data to understand patterns in orders, areas of significant traffic, and the overall flow of storing and packing goods. This information can help redesign any areas within the warehouse that need to be reorganized.
2. Inventory tracking
It goes without saying but inventory is key to any successful business. Once a customer places an order, you must have the inventory to fulfill it. Mismanaged inventory, shortages, or delays in receiving inventory can significantly impact your bottom line. With the inevitability of human error and minimal transparency, manual tracking systems are becoming a strategy of the past.
Solution: use a cloud based warehouse management software to track inventory.
Enabling businesses to avoid many of the errors and issues that arise with traditional methods of measuring stock levels, cloud-based inventory management seamlessly keeps track of inventory coming in and going out of your business. These systems allow for more accurate and efficient inventory management and enable your staff to focus on more critical aspects of the business.
3. Picking optimization
The process of manually picking orders from your warehouse is not only tedious, it’s also highly time-consuming. From entering SKUs, picking and packing goods, and preparing for shipment, picking management can cost your business time and money.
Solution: integrate warehouse management systems that use scanners or image capture for picking optimization.
Using a WMS allows warehouse managers to get the most up-to-date tracking for inventory, order fulfillment, and order processing. Through automation and formalized picking routes, businesses can significantly reduce order fulfillment time and increase order accuracy.
4. Labor costs
According to a recent report, Labor Management Strategies in the Warehouse, 50 to 70% of a company’s warehousing budget is labor costs. Yes, you read that right. According to the study, labor comprises the largest portion of a warehouse’s total operating budget, making finding (and retaining) the right people and optimizing warehouse productivity a large priority.
It’s also important to address the additional costs that warehouses have endured due to COVID-19. From contactless order fulfillment, social distancing requirements, and regulated cleaning options, labor costs have significantly increased from the pre-pandemic budgets.
Solutions: implement a labor management system (LMS) that can reduce large labor forces and take over tedious, repetitive tasks.
Labor management systems are software applications that manage human resources within a distribution center operation. The LMS typically integrates with the warehouse management system. These systems feed data into the WMS to help reduce labor costs, predict labor shortages and drive productivity.
5. Customer service
In the end, it’s all about the customer. We have talked extensively about the Amazon effect and how customer expectations have shifted to create the need for fast and effective order fulfillment and delivery. Warehouse operations managers have to focus on customer satisfaction to drive revenue growth and build customer loyalty. This means that all touchpoints throughout the warehouse – picking, packing, shipping, delivery – are working together to deliver goods on time and accurately.
Solution: use warehouse management systems for transparency throughout the warehouse resulting in fast, reliable deliveries.
Warehouse management systems give operations managers the ability to track and evaluate the order process throughout their warehouse. These systems can recommend strategies and processes that need updating, take over time-consuming, repetitive tasks, and eradicate outdated practices.
Implementing a warehouse management system can be costly and requires technical support that not all warehouses can accommodate. At WSI, real-time warehouse management systems are fully integrated into the operations to provide enhanced 3PL services to businesses of all sizes. Our team of experts can walk you through different WMS options and help implement that technology that works best for your company. Want to learn more? Contact WSI today.