Efficiently setting up a warehouse is essential for the smooth flow of operations and optimum productivity. However, there are some common setup mistakes to avoid.
Poor planning
One of the most common mistakes is creating a poor layout that fails to optimise picking paths.
One of the highest warehouse costs is labour. Lengthy picking paths take longer, and this increases staff costs.
Carefully monitor the pick frequency of every item. Goods that are picked most often should be near packing stations. This strategy alone will significantly reduce the average item picking time.
A poor overall facility layout can be caused by not examining every part of the warehouse and how it works. For instance, inadequate goods in an inward space interrupts the flow of inventory into the warehouse.
Untrained staff
Well trained staff are a key element of setting up the warehouse. Even if the warehouse layout is perfect, a lack of staff development and training makes a warehouse inefficient.
Untrained staff make mistakes, pick the wrong items, break things and take too long to complete tasks. This is financially costly for warehouse owners.
Failure to measure the performance of staff means that staff weaknesses that can be rectified through training are not identified.
Holding excess inventory
Poor management of stock levels results in the understocking of popular items, while another item is overstocked. Lack of inventory management also results in lost items, or items that are difficult to locate.
Some warehouse owners avoid warehouse management automation technology because they think it is too expensive and complicated. This is a false economy as, in the long term, a good warehouse management system can save money by restoring order to inventory organisation.
Technology that replaces the utilisation of paper processes accurately tracks stock levels and can also handle restocking of items before they become out of stock.
Failure of planning for the future
Some warehouse setups are exclusively designed for today’s level of business. This ignores future growth plans.
Does the current setup allow for increased sales? Is the setup flexible enough to expand to achieve the company’s long-term goals?
Substandard housekeeping
Signs of poor housekeeping include thick dirt on surfaces, non-functioning lights, and broken pallet boards and boxes littering the floor. Not only is this a safety risk, but it also fosters a culture where staff don’t take pride in their work.
To improve housekeeping, set aside a little time each day at the start or end of a work shift to clean and tidy up – even if there is also cleaning staff.
Poor maintenance
Often where there is poor housekeeping, there is also inadequate preventative maintenance.
When equipment breaks down, it is not usually due to bad luck, but poor maintenance. A good preventative maintenance program is costly, but is usually not as much as the cost of production time lost through stoppages.
Poor warehouse equipment
Another common warehouse setup mistake is purchasing poor equipment or using the wrong equipment.
It may be tempting to buy cheap warehouse trolleys, tables, shelving and other essential equipment, but this is a false economy. Equipment made using strong tubular steel is designed to last and not break down.
In the long term, premium quality equipment can work out cheaper, as equipment will need replacing less often. Reliable equipment is less likely to break down and cause expensive stoppages.
Lack of strong health and safety policies
Inadequate safety measures can be costly. Injured workers are less productive, and accidents result in hefty compensation claims. Warehouse management that doesn’t promote mental well-being finds that staff are unmotivated and less productive.
A warehouse policy focused on health and safety promotes physical and mental well-being.
Failure to consult workers
When warehouse workers are not consulted about the setup of the warehouse, management is ignoring a valuable business asset.
Workers spend their working life in the warehouses. This gives them a unique insight into how things operate and how they can be improved. Some setup mistakes can be avoided through consulting the staff.
Inadequate security
Poor security fails to protect valuable inventory. Access control systems that prevent unauthorised access are important. CCTV cameras, alarms and secure storage areas stop theft.
Poor sustainable practices
It is a mistake to ignore sustainability and environmental issues. As well as hurting the environment, the lack of environmental practices in the warehouse damages the reputation of the company.
A warehouse without waste recycling systems and energy efficiency technology, that only has one-use plastic packing, can be judged unfavourably by staff and customers.
Warehousing and logistics is complex. Customers demand quick and accurate order deliveries, and there is fierce competition. Warehouse management must strive for as few mistakes as possible in how the warehouse is set up.
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