From receiving to storing to shipping, the layout and flow of your warehouse will determine in large part how well your business operates.

We’ll help you get your warehouse in order and improve the speed and efficiency of your employees with the following 7 warehouse organization tips.

Re-evaluate Your Warehouse Layout Design

Your Warehouse layout design is the bedrock of warehouse organization.

Without it, you won’t be able to optimize the rest of your warehouse.

Here are 3 major principles to keep in mind when planning (or updating) your warehouse layout:

• Flow – meaning the uninterrupted movement of materials, people, and traffic within your building.

• Accessibility – meaning every product and all products on pallets should be accessible by everyone, usually without the need to move one product to get to another.

• Space – meaning the maximum warehouse space you can afford, taking into consideration storage, stock, offices, working areas, empty pallet storage, battery charging, etc.

Use Warehouse Racking Organization

Warehouse racking organization is a method of storing your inventory vertically instead of horizontally, such as on pallet racks.

This is a cost-effective way to maximize your warehouse space if you carry a lot of inventory or if you have a small warehouse and can’t afford to buy more space.

Vertical racks also allow you more space on the ground for forklifts and other trucks to easily maneuver around your warehouse, as well as more space for additional employee work areas and safety stock inventory.

Use ABC Analysis to Set Up Warehouse Inventory

ABC analysis of inventory is a method of sorting your inventory into 3 categories according to how well they sell and how much they cost to hold:

• A-Items – Best-selling items that don’t take up all your warehouse space or cost
• B-Items – Mid-range items that sell regularly but may cost more than A-items to hold
• C-Items – The rest of your inventory that makes up the bulk of your inventory costs while contributing the least to your bottom line

ABC analysis of inventory is one way of applying Pareto’s 80/20 principle. The bulk of your profits will usually come from about 20% of your total inventory.

After grouping your inventory into ABC categories, arrange your pick and pack area in a way that gives your employees the easiest access to A SKUs, then B SKUs, and finally C SKUs.

Keep Your Warehouse Clean

The more clutter in your warehouse the higher the likelihood of safety hazards and accidents, in addition to reduced productivity.

More than that, a disorganized and dirty warehouse could lead to obsolete inventory – raising your cost of inventory.

An orderly warehouse, on the other hand, will increase your efficiency and throughput, while potentially improving your lead times.

Label Warehouse Inventory

Your employees shouldn’t have to rely on memory when searching for items in your warehouse. Every SKU in your inventory should be clearly labeled for easy identification.

Keep your labeling consistent for every item (i.e. always label the bottom right corner of boxes) and include all the necessary information on every label, such as:

• Product name
• SKU
• Color
• Size
• Date
• Etc.

Also, consider using RFID barcodes for quick scanning and easy stocktaking.

Make Receiving Inventory Easy

Receiving inventory effectively is one of the key warehouse management tips because it sets the tone for the rest of your warehouse and inventory processes. If you screw it up, everything else will be screwed up with it.

Here are a few ways you can improve inventory receiving:

• Optimize your receiving space by providing the proper tools and enough space to allow your employees to sort and store incoming inventory.

• Keep your receiving space clean and organized by removing clutter and putting every tool away after using it.

• Track inventory in real-time by implementing a perpetual inventory system in order to reduce miscounts, missing inventory, and incorrect shipments.
• Monitor quality control by hiring a quality control manager to watch for mistakes, point out problematic procedures, and reduce the instances of inventory damage.

• Unload received inventory quickly and safely by using the appropriate machines (i.e. forklifts and conveyor belts) and following clear safety procedures.

• Avoid shipping the wrong items to your customers by verifying the goods received using metrics such as the description of goods, product code, batch tracking number, etc.

Regularly Review Your Warehouse Organization System

To continually improve your warehouse’s organization, you’ll need to continually review your warehouse operations.

From placement of equipment to flow of processes to effectiveness of policies, you should regularly verify that you’re maximizing your warehouse space and improving your employees’ productivity.

By formalizing a policy of “checking in” with your warehouse systems and organization, you’ll be able to quickly identify any problems in your processes that could harm your bottom line long-term if you don’t address them.

This article was originally published in: https://dearsystems.com