Top 5 Warehouse Efficiency Best Practices

On the surface, managing a warehouse should be a simple and straight-forward process. You simply manage the labor, inventory and freight, and at the end of the day, you count the money, right? If only it were that easy. Today, warehousing operations face unprecedented international competition, increasing labor costs, and the constant challenge of finding freight companies that can consistently meet their needs.

The reality is that successful warehouse managers have to constantly find ways to reduce costs, boost revenue, reduce errors and increase operational efficiency, and that’s just to stay afloat year after year. Here are five of the best warehouse efficiency practices used by top managers in the business.

1) Ensure Accurate Receiving and Labeling with Mobile Workstations

Receiving is the most important activity at any warehousing facility. Accuracy, timeliness and organization in receiving affect all downstream processes, so it’s important that the process is optimized to produce the best results. Industrial mobile workstations allow warehouses to accelerate their receiving processes – the workstation can be brought directly to the receiving dock and used to verify counts, print and label items, and accurately sort and direct new inventory for put-away.

2) Document KPIs to Drive Continuous Improvement

Is your warehouse tracking KPIs for key processes? Your warehouse may be generating millions in revenue, but do you know your costs on shipped orders? Your cost per box? Do you know your average orders picked per shift? Is there any system in place to measure individual worker productivity? If you’re not continuously measuring your performance, you can’t implement any cost-savings measures because you have no way to tell if they’re working. Smart warehouse managers track KPIs and use them to innovate and implement cost-savings strategies with measurable results.

3) Minimize Walking Steps to Maximize Labor Efficiency

Order picking and packing can comprise up to 50% of labor costs in a typical warehouse, and the workers who pick and pack orders can spend as much as 60% of their time walking back and forth through the warehouse. Altogether, that walking time amounts to a huge waste of labor dollars throughout the year.

Warehouses that implement mobile workstations to reduce walking steps for their workers can expect to pick and pack more items per hour, effectively increasing their labor efficiency while reducing walking steps that cause needless fatigue and increase distractions that lead to costly errors.

4) Streamline Processes and Implement RF to Reduce Shipping Errors

Shipping errors can happen for many reasons, and it’s important to understand why they occur in order to prevent this needless source of lost profits. Still, if you’re not using RFID to track inventory, it’s worth implementing today. Mobile workstations with a portable RFID scanner can be used to verify accurate picking on-the-spot, virtually eliminating human error from the picking process.

Warehouses have also found success in reducing errors by decoupling the picking and packing processes. One worker picks the order, another verifies that the order is correct before packing it for shipping. This workflow ensures that outgoing orders are double-checked before errors can negatively impact the customer.

5) Engage Employees to Get Effective Feedback

Growing labor costs are putting the squeeze on profit margins, and the costs of interviewing, hiring and training new workers make employee retention a worthwhile initiative at any warehouse. Employees are the experts on their jobs, and most of them want to do their jobs as well as possible. Asking your employees directly how you can help them do their jobs better is a valuable activity, as it boosts employee engagement, improves retention, and gets you valuable feedback on what changes you can implement to increase efficiency at your warehouse.


Warehouses that implement these best practices for improving warehouse efficiency stand a good chance of staying profitable and competitive in the years ahead.


About the author:

Patrick is Vice President at Definitive Technology Group. His career started in the US Air Force where he served as a Combat Medic. After his military service, he earned multiple undergraduate degrees along with two masters, including an MBA. As co-founder of Definitive Technology Group, he has great passion for developing products that improve process and workflow efficiency.

About Tom Reddon

Tom has been involved in the forklift industry since 1986. He loves doing research, blogging, and speaking about forklifts. You can contact Tom on his Twitter or Google+ profiles.

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