Teruel, Mary Jochelle G.

CBET-18 604E

Warehouse Operations Best 5 Practices 5 Tips to Help Improve Warehouse

Management and Operations

Warehouse managers know all too well that the task of managing operations for a warehouse
facility is far from straightforward. Warehouse operations managers are tasked with ensuring the
efficient flow of products in and out of the facility, optimizing the buildings layout, making sure
orders are fulfilled and products are in stock, but not overstocked. Add ensuring profitability and
minimizing overhead and labor costs to the mix, and warehouse operators have their work cut
out for them.

With so many factors to balance, considerations to weigh in every decision, and pressure from
stakeholders on all sides to be more productive, minimize expenses, and maintain a smooth
supply chain flow, its no surprise that there are many articles and resources outlining best
practices for warehouse operations.

To make analyzing the vast array of information on warehouse operations best practices, weve
put together a relatively concise list of best practices from a variety of sources. Here are some 5
best practices for warehouse operations to provide a useful resource for warehouse managers
aiming to be top performers in their field and produce the best results possible for their
companies. While categorized by topic, please note that the following best practices are not
otherwise rated or ranked in any particular order of importance.

1. Use automatic data collection.

The benefits of automatic data collectionvia bar code and radio frequency
identificationare well-established, including increased productivity and accuracy and
lower labor costs. But plenty of companies still havent implemented automatic data
collection.

Some organizations with 30,000 or 40,000 item numbers and multiple facilities are still
convinced theyre better off without technology Denny McKnight, partner,
Tompkins Associates Inc., a supply chain integration firm headquartered in
Raleigh, N.C.

2. Dont rely on manual data entry processes.

Use mobile computers with bar code scanners or RFID readers at the receiving dock to
immediately identify products on arrival. This helps get product off the dock quickly and
eliminates nearly all the errors associated with manual receiving: including identification,
counting, and data entry errors. With scanning and RFID technology, youll avoid
the mistakes that wreak havoc with inventory accuracy and eat up time and resources
 to fix. And that means your warehouse staff can focus on processing customer orders
more quickly. Top 10 Losing Warehouse Strategies and How to Avoid Them,
Motorola Solutions

3. Implement lean warehouse operations practices.

Designing and implementing Lean warehouse operations can have a great impact on
the total supply chain output. By approaching the waste focus areas mentioned above
with Lean solutions, some of the opportunities that come up to reduce lead times in
warehousing include:

Reduction in material handling time in order picking, put away, palletizing and shipping.
Reliability of information to coordinate the rest of the supply chain.
Reduction in truck and containers loading and unloading times.
Reduction in time spent checking and looking for inventory.
Increased flexibility to adapt to changing market conditions and customer
specifications. Lean Warehouse Operations, Four Principles

4. Only trained operators should use equipment such as forklifts, cranes, and
hoists.

Forklifts and hand trucks arent the only warehouse equipment that can prove
hazardous. Contact with moving conveyor parts can cause serious injuries. Thats why
its so important to keep their guards in place. Cranes, hoists, and derricks can be
operated only by trained operators who know enough to keep from swinging a load over
people or to remove their hands or feet from controls while a load is suspended. In
addition, anyone who works in the vicinity must pay attention to crane movements; if
you work or stand under a crane, youre looking for trouble. You may spot hazards in
the way this equipment is loaded, too. Heavy or unbalanced loads could fall over and
cause serious injurieseven fatal ones. Warehouse Safety, BLR.com

5. Establish stable warehouse operations within the warehouse first, then work to
improve pre-planning efforts.

The first place to start the MRO improvement process is in the warehouse itself. Once
stable warehouse operations have been established, maintenance and operations can work to
improve their pre-planning efforts. At first glance, this appears to be a daunting task. Trying
to organize, store, identify and properly manage thousands of disparate inventory items, with
different and seemingly unpredictable demand patterns, creates an environment in which it is
difficult to succeed. Creating an implementation strategy that is simple, straight forward and
thorough, is critical to a successful MRO Warehouse Operation. Creating the Perfect
Warehouse, MRO Connection
Policies and Procedures

Policies

The policies contain hard and fast rules and regulations that define the general conduct of the
warehouse operation. Examples of the types of policies that organisations will define are as
follows:

organisational specific warehouse management policy and procedures guideline outline

health and safety
human resources management
security
pest control
warehouse maintenance and cleaning
quality control
record keeping and reporting
reverse logistics Return of goods and exit strategy in the event of downscaling or
shutting down operations
Disposal of obsolete and damaged goods.

Procedures

The procedures' document defines step by step how the activities in the warehouse should be
carried out and clearly defines the processes to be adopted. These can be adopted as best
practice.

The procedures provide visibility of the operations for managers and donors.

However, in creating such procedures, care must be taken to avoid constraining the use of local
initiative which might be required to deal with local conditions. Procedures should be considered
as streamlining the business processes and providing checks and balances. They provide
guidance to warehouse managers and must have some level of flexibility to cater to unique
situations. This can be achieved by limiting the level of detail that the procedures document
defines, allowing more flexibility and/or by arranging dispensations to allow departure from the
procedures in order to optimize local performance, especially in emergencies.

The procedures will normally provide the step by step guidance on how to manage each aspect
of warehousing and may cover:

Receiving and issuing of supplies;

Quality control or verification;
Storage of goods;
How to control stock movement (stock control);
Documentation flow;
How to detect and deal with stock losses;
How rejected material will be managed; and
How to deal with unwanted material, obsolete and scrap, disposal.
Teruel, Mary Jochelle G.

CBET-18 604E

Warehouse Preparation Planning

Space layout

The areas that should be planned are both the general storage areas and the areas for goods receipt,
consignment picking and goods dispatch. It is also desirable that space should be set aside for the
following activities:

equipment maintenance and parking;

charging of equipment batteries such as pallet trucks;
refuelling of trucks;
an area for garbage disposal e.g. empty packaging;
a quarantine area for keeping rejected goods, goods to be sent back or destroyed;
an employee rest area;
washroom; and
an administration office.

Planning

It is worth keeping these requirements in mind during the planning of the main operating areas. Planning
consideration needs to be given to the following:

allocate space for each type of product and locating number;

allow sufficient space for easy access to the stacks for inspecting, loading and unloading. Stacks
should be one meter from the walls and another meter between stacks;
sizing the goods receipt and despatch area;
allow space for storage of cleaning materials and supplies;
allocate areas for damaged items by consignment number;
allow sufficient space to repackage damaged items and place it in separate stacks;
sufficient free space is needed to operate a warehouse effectively. When planning the size of a
warehouse consider:
o planning on having about 70-80% utilisation of available space, whilst considering:
o throughput rate
o number of stock keeping units (SKU)
o handling characteristics of items, etc.