The key to operating an efficient warehouse is having the right data to evaluate your processes. Without that, you won’t notice where inefficiencies lie. If you’re an efficient manager, you’re measuring with metrics and benchmarks. Here are six things that should be on your list:
You conduct regularly-scheduled cycle counts.
Here is where you take inventory of a small section of your warehouse to test effectiveness of your inventory processes. This accuracy sample is useful; mistakes found in a small sample almost guarantee mistakes throughout the rest of the warehouse.
Regular cycle counting tells you how often and in what order mistakes occur. To ensure the entire warehouse has been counted at the end of a cycle, counts should be rotated. Counting the same sample repetitively doesn’t give you a very good gauge of accuracy.
You know your inventory turnover rate.
This is simply how fast you completely cycle through your inventory. The higher your rate, the more you are shipping out of the door, or in other words, the more money coming in. You can make your rate more transparent with cycle counts, inventory counts, and other tracking systems available for the warehouse.
You have control over your inventory
This is all about inventory management – knowing where all inventory is, and being proactive rather than reactive. If you have 100 SKUs of something, your employees should be able to retrieve all 100 without incident. You shouldn’t be uncovering lost boxes of parts or products randomly throughout your warehouse. Warehouse management systems tell you where a product is, how much you have, and when to schedule new stock orders. This helps managers be most efficient with inventory control.
You efficiently use your warehouse space
Space is one of the biggest challenges and expenses in warehousing. With an ever-growing inventory, it’s easy for items to be disorganized in numerous ways that waste space and time. Your warehouse management system should help you control your stock and know your numbers. In addition, you may be able to sort more efficiently, reduce SKUs with lean strategies, or utilize more of your vertical space.
You’ve cross-trained the majority of your employees
Consider how tasks fluctuate each day for your facility. If your employees aren’t trained stocking, pulling, and counting inventory, for example, there will be times when some employees aren’t working efficiently (or at all). Excessive labor costs are a major strain on warehouses.
You’ve optimized packaging and shipping
This is an area that can easily eat costs very quickly if you’re not paying attention. From the ease in which packages can be filled, to the materials used, to the arrangement on a pallet, every decision you make in your packaging translates to money lost or money saved. If you need to review your process with experts, Packnet offers free assessments on standard and custom solutions. You can contact them at 952.944.9124 or fill out a free assessment form.