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Question answered in Quora - How do I optimize a warehouse?


This is a very broad question. There are many things to optimize, the most important thing is whatever you want to optimize you need to measure, what you cannot measure you cannot manage, so you cannot optimize, also the more you focus on measuring, the more you can make people accountable, and also people will focus and execute on what they are measured on

The most important thing for any warehouse is to ship orders, the more orders you ship the more you can invoice and more you can get paid.

So keep that in mind and work backwards, so what is your typical volume look like, how many orders. How many boxes/cartons? How many items? How many units? So how many people will you need to pick those units? Are you picking unit by unit or boxes by boxes, with people buying through Internet crazily, there are a lot of Ecommerce operations that have come up, for them the order profile is picking 1 or 2 units, so batch orders so a person can pick a batch of 10 or more orders and do it efficiently, then there is retail, shipping to a store, usually like dozen of a specific item, so boxes of dozen are picked and shipped, then there is also wholesale, where pallets of items are shipped to a wholesale buyer, once you get the volume and the number of order pickets you need, then determine how much inventory you need to receive, put away and replenish, based on that determine the number of people you will need for the operation, also determine why peak volume will look like, you need to have a way to optimize processes and also get additional labor to support peak volume, usually that is done by coming with processes that run in cordoned off areas to ahip the most bought fast moving SKUs, also hire temp workers, also have any tools these temp workers need

Here are some very high level aspects that can be optimized

1-Labor

2-Throughput

3-Inventory

1-Labor - To optimize labor you need to measure and manage labor. Basically every single minute of everyone on the floor needs to be measured, there are labor management systems that can do this, you can come up with engineering standards for every single job that is performed in the warehouse, then Engg standards can be applied and you can measure what are called SAMs, Standard Allowed Minutes, the actual minutes to takes to get a job done, based on that you can calculate efficiency of the person by seeing how long the person is taking. Then you need to display these numbers on a daily basis, if you can show this realtime to warehouse operators that will be even better

2-Throughput-This is the amount of product you are able to push through the warehouse, it varies depending on the channel, for Ecommerce orders the throughput can be measured in units/cartons, whereas for a retail channel you would typically move boxes, but you have to measure the right thing, measuring units for retail channel cannot be compared to units for Ecommerce channel. So be careful in what you are measuring

3-Some warehouses measure this at the warehouse level, some don't, some might look at this across the entire supply chain, the most important thing is inventory accuracy, once your inventory is accurate, let us say to the level of 99.9%, then you can look at optimizing the inventory in the warehouse, the least you can keep on hand it is better, the most important thing is you need to have enough inventory to fulfill every single order, the last thing you want is a disappointed customer that is not able to buy what they saw in the store or your website, the lost sale is the every retailer's dreaded scenario

Hope this helps, if there is a specific question will be happy to answer that one.


ABOUT THE AUTHOR 

Puga Sankara is the CEO and Founder of Smart Gladiator. Smart Gladiator is an ATDC Georgia Tech company, Smart Gladiator's award-winning product LoadProof (https://feature.loadproof.com/loadproof) is an Enterprise Photo Documentation System that is enjoying tremendous traction in the Supply Chain Community. LoadProof (https://feature.loadproof.com/loadproof) is a patent pending Centralized Cloud based Enterprise Photo Documentation System for Supply Chain. It is built on the premise that photos and videos are vital documentation serving as compelling proof of important operations performed in the supply chain within and across organizations. These operations may be related to fulfilling customer orders, meeting contractual obligations, or transferring merchandise across different parties taking part in the Supply Chain operations. LoadProof is as important for your organization as an ERP (Enterprise Resource Planning) which is an enterprise system of record for critical documents such as Purchase Orders, Sales Orders, Contracts between parties etc. that have tremendous legal ramifications, or a WMS (Warehouse Management System), that holds indispensable information related to orders shipment/fulfilment data. Just like Instagram, Facebook or Snapchat have evolved into platforms that enable individuals to showcase how pretty they or their clothes are, LoadProof is a similar Enterprise system of record that holds photos, not so much for show off, but to serve as compelling, unequivocal, thoroughly documented proof, even in the court of law when there is a dispute between organizations while they perform many facets of their functions/operations, as well as for increased visibility and transparency within the Supply Chain. The capabilities of LoadProof are discussed in detail in the next sections of the document below. LoadProof is live in 460+ Sites, 250+ corporates, 13 Countries.There are more testimonials in this link here also https://www.g2.com/products/loadproof/reviews. Learn more here on our YouTube channel,  https://youtube.com/@smartgladiatorloadproof  & also here in LinkedIn - https://www.linkedin.com/company/smartgladiator/

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