How to Improve Your Warehouse’s Inventory Management

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The hallmark of a well-run warehouse is effective inventory management. When a warehouse can’t manage its inventory properly, it affects the entire business’ bottom line due to lost product and delayed orders. Warehouse inventory management isn’t just about assuring that every item is accounted for and stored in its proper place. Its processes are designed to maximize productivity, reduce costs and protect goods, all while ensuring an accurate inventory count.

Implementing proper inventory management reduces the amount of time you spend locating items throughout the warehouse. It also ensures that you maintain proper inventory records. If you’re a warehouse manager in search of ways to tighten up your entire operation, it’s wise to begin with your inventory processes. By following these tips, you’ll be able to enhance your overall warehouse performance while maintaining accuracy:


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1. Follow a Smart Warehouse Layout

Warehouse layout directly affects your ability to keep an accurate inventory count. A smart layout makes the most of warehouse space, which means goods are stored in a logical order and flow. SKUs and similar items are all grouped together in their own clearly defined and well-marked sections. Keeping products well-organized and ensuring each type of product has its own place within the warehouse layout prevents you from missing items when picking and counting them.

Another aspect of proper warehouse design is to arrange the warehouse based on picking frequency. High-selling items should always be stored in easily accessible locations, close to the shipping area. Giving fast-moving items the best warehouse real estate reduces labor costs by preventing pickers from traveling long distances. In addition to maximizing productivity and picking efficiency, this strategy also prevents you from having to physically re-allocate inventory unnecessarily, which puts it at risk of damage.

2. Invest in Warehouse Management Software

Warehouse management software, or WMS, is a must-have tool for all modern warehouses. WMS was originally developed to improve a warehouse manager’s ability to keep track of inventory. But over the years, and as consumer demand has changed, WMS has drastically evolved into a much more comprehensive program.

Why Use a Warehouse Management System WMS

Today, managers can use WMS for inventory management as a way to maximize productivity, decrease labor costs, reduce product loss and improve overall warehouse processes. WMS gives managers detailed insight into warehouse operations. It allows managers to uncover data about their operations and use it to improve inventory management processes. WMS can assist with:

  • Locating stock anywhere at any time within the warehouse or throughout the supply chain to ensure faster order fulfillment.
  • Making informed warehouse layout decisions by identifying high-selling, fast-moving inventory and SKUs that should be placed in the most accessible locations.
  • Improving inventory accuracy by comparing physical inventory levels with what’s reflected in the WMS.
  • Determining which types of products the warehouse struggles to manage, account for and move out of the warehouse quickly.
  • Uncovering opportunities to improve inventory management practices, including where items are physically stored in each warehouse destination.
  • Ensuring quality control and order accuracy by pulling picking lists and comparing them against the picked items for each order.
  • Reducing product loss by tracking employees and making sure only authorized people are in the warehouse.

These are only a few ways WMS can help improve your warehouse inventory management. If your existing software can only perform some of these functions, it may be time to invest in a new system. If you’re looking to invest in new WMS software, it’s important to do your research and discover which systems cover the functionality of your specific warehouse requirements to ensure accurate inventory control.

3. Perform Regular Cycle Counts

The conventional approach to inventory control involves performing a massive annual audit. Inventory audits ensure all your stock is accounted for and determine if you have too much or too little product compared to what the books show. While extremely important for preventing product loss and protecting profitability, yearly inventory counts are exceptionally time-consuming, overwhelming and, in many cases, inefficient.

Warehouse Cycle Counting

You don’t have to wait until the end of the year to take on such a huge task. You can divide the daunting responsibility of inventory audits into regular, ongoing cycle counts. Depending on the nature of your warehouse and business model, there are different intervals at which you can conduct cycle counts.

For warehouses with high-ticket items but low sales volume, an annual or quarterly cycle count will suffice. But, for businesses moving a significant amount of inventory in and out on a daily basis, monthly, weekly or even daily cycle counts will make the most sense.

Cycle counts are inventory audits done on an ongoing basis and in waves. During each wave of cycle counting, you can audit certain categories of inventory. Any discrepancies found in the cycle count can indicate a need for improvement in the inventory management of that particular product. As you conduct cycle counts for each section of the warehouse, you’ll maintain a much more accurate inventory count and spreadsheet.

4. Develop a System of Labels, Barcodes and Scanners

The basis of good inventory management is knowing what and where everything is at all times. A system of labels, barcodes and scanners can help you keep track of the stock. No product should be without a label of some sort, whether it’s a barcode or another identification unit. You can develop your own customizable labeling system that makes sense for the type of stock you carry and the categories of inventory you maintain.

Because every item is labeled, it reduces the chances of goods getting lost within the warehouse. When every label is entered into the WMS, it makes it much easier for warehouse pickers to select the right inventory for orders, mitigating the chance of incorrect shipments. Pickers can use handheld scanning devices to look up each item and cross-reference it with the WMS and pick list to ensure picking accuracy.

However, an effective warehouse inventory management system doesn’t label and account for goods only. It also labels each destination within the warehouse, or the warehouse’s “fixed” assets, such as bins, containers, shelves or other storage units. Every unit should be assigned a destination number and labeled appropriately. This makes sense for both receiving and picking stock.

Receivers can look up the goods they’ve received and know where it should be stocked based on its destination number. Additionally, pickers can identify items based on their destination number and easily locate them within the warehouse.

5. Follow Inventory Management Best Practices

It’s essential for all warehouses to clearly define in-house standards for how stock is managed and moved throughout the warehouse. Best practices should always be explicitly communicated with warehouse staff, and managers should have systems in place for ensuring they’re adhered to.

Warehouse Inventory Management Best Practices

When followed, these practices reduce inaccurate inventory counting, ensure all orders are correctly put together and decrease the amount of product loss. Here are some examples of practices you should consider following in your warehouse:

Limited Touches

All warehouse systems should aim to reduce the number of “touches” goods experience. This means finding the most direct route from receiving to storage to shipping. The more items get shuffled around, the more at-risk they become of being miscounted, lost or damaged. When you practice limiting the number of touches, you reduce unnecessary and costly movement of inventory around the warehouse.

Quality Control

Every warehouse should have a quality control practice in place. In a warehouse, the simplest QC practice is to double-check every order against the order’s pick list. Once items have been picked and placed into a shipping container, they should then be checked against the order’s pick list to make certain it’s correct.

Warehouse Quality Control

Commitment to Safety

Part of best practices is the safe handling of material. All warehouse staff should be properly trained in standard safety practices, including how to properly use forklifts, pallet jacks and other material handling equipment for heavy items placed up high. Proper inventory handling reduces the risk of workplace injuries and product loss.

Daily Clean-Up

A cluttered warehouse makes it easier for inventory to become lost. To maintain excellent inventory practices, it’s wise to ensure that at the end of every shift, workers have enough time allocated for clean-up. After they’ve processed the last order of the day, workers can return all unprocessed inventory to its proper location.

Inventory that hasn’t yet been officially received and put away can be noted to prevent double-counting. End-of-shift cleaning allows workers to get started on orders first thing in the morning because all inventory and tools will be put away.

Weighing Systems

In your warehouse, you can make it a regular practice to weigh goods as they arrive and before they ship. When everything gets weighed, it lets you know how to safely stock your goods to prevent overloading shelving and storage units past their capacity. Weighing goods helps you make decisions about where to place stock and how to ship it. Once orders are picked, weighing items makes sure you’re able to meet the right shipping requirements so you can process and send the order correctly without incurring penalties.

Cross-Docking

A logistics practice that has been around for decades, cross-docking is a way to control inventory, so it spends minimal time in the warehouse. With cross-docking, you receive goods, then load them directly onto outbound trucks headed for another distribution point or to their final destination.

Cross-docking doesn’t work with all inventory management systems, but it can work for some. If this option is available, cross-docking can reduce warehouse carrying costs, streamline inventory management and reduce the risk of mishandling.

Wave-Picking

A final inventory management practice that may work in your warehouse is wave-picking. Instead of picking one order at a time with items being pulled from various locations throughout the warehouse, workers pick multiples of items in waves, minimizing the amount of travel they do throughout the day.

Wave-picking streamlines operations, but it’s also a good practice for inventory control. Wave-picking can ensure inventory accuracy and quality control because each wave corresponds with a consolidated pick list generated by the WMS, which reduces picking errors. The practice can also be combined with replenishment so that you can continue to keep inventory stocked as needed.

6. Use a Variety of Storage and Sorting Solutions

If you carry a variety of stock, it only makes sense to have a variety of storage options to house it all. Each item may need to have its own type of storage solution. Diverse storage allows for easier item selection and a more efficient cycle counting and inventory auditing. If everything is properly stored and highly visible, you’ll be less likely to lose track of goods.

Variety of Storage and Sorting Solutions in the Warehouse

Palletized items need plenty of sturdy shelf space that’s safely accessible for material handling equipment. Forklifts and pallet jacks should be able to operate within the aisles for safer handling. Perhaps in your warehouse, not all stock will remain palletized and stored directly onto shelving. Certain goods can be separated and allocated into bins or containers. If these items are hot-sellers, they can be kept in bins at an accessible height on shelving — between the average person’s waist and shoulders, so they’re easy to grab.

By using a variety of storage solutions, you can keep your goods neatly sorted and ensure the warehouse stays decluttered. When your warehouse doesn’t have enough versatile storage solutions for all the goods you stock, items can become lost, and it’s harder to keep track of them. Proper warehouse storage helps you find and account for items and improve order picking efficiency.

7. Maintain Good Supplier Relationships

One overlooked way to improve inventory management is by building good relationships with suppliers. By having open communication, you can plan how to manage inventory flow into the warehouse better. Suppliers can reduce your inventory carrying costs by helping you plan ahead for what items you’ll be receiving and when.

Discuss your needs with your suppliers. They might be able to develop a different shipping schedule and send smaller loads more frequently, making the inventory easier to manage. This allows you to implement a better receiving strategy by having the correct amount of staff and freeing up enough warehouse space.

Additionally, having good relationships with suppliers helps you fulfill orders faster. If consumer demand increases — or you predict an increase in consumer demand due to seasonal activity — work with your suppliers to ensure you can receive enough stock on-time to fulfill the orders. Remember, your customers are your suppliers’ customers too, so it’s important for both parties to work together to ensure inventory moves quickly and accurately out the door.

8. Perform Regular Upkeep

Regular upkeep is crucial to both maintaining effective management processes and improving upon them. It’s important to step back and regularly examine your current systems. Even the most organized warehouses can slip into clutter and disarray when practices aren’t maintained. Disorganized warehouses make picking, cycle counting and replenishing take longer than necessary.

Regular Warehouse Maintenance and Upkeep

Part of upkeep and organization is making sure your practices are streamlined based on current activity. Managers should constantly be assessing their high-selling goods and making changes to the warehouse layout as customer demands change. Another aspect of upkeep to consider is what to do with damaged products.

Damaged products need to be written off or processed through the WMS in some form. If you aren’t regularly accounting for damages in your inventory management system, they can accumulate over time, making it a bigger task than necessary.

Consider implementing daily, weekly and monthly checklists of upkeep items. By scheduling warehouse upkeep in advance, you can stay on top of messes and clutter.

9. Reduce Product Loss

Proper inventory management largely involves keeping track of all goods and knowing how to store and organize them properly. But it also involves implementing practices to keep your inventory safe from damage or theft. By actively reducing product loss, you can streamline your operations and maximize your profitability. Warehouses are complex systems, and products are prone to damage or shrinkage when proper measures aren’t in place to protect them.

Reduce Warehouse Profit Loss

One of the key aspects of inventory management is also people management, and it’s a big opportunity for protecting your bottom line. It’s important always to know who is in the warehouse at all times and ensure that everyone is authorized to be there.

If you don’t have a proper protocol for tracking people in your warehouse, it can be easy for unexpected people to take advantage by entering the warehouse and helping themselves to goods. Today’s advanced warehouse inventory management systems also have employee tracking tools, allowing you to control both inventory and the flow of traffic through your warehouse.

A second way that you can reduce product loss is by investing in the right tools that protect goods. Warehouses need sturdy storage solutions that are stable and secure enough to prevent goods from falling off and breaking or becoming contaminated. Additionally, workers need material handling and moving equipment that keep goods safe while in transit from one end of the warehouse to another. Investing in the right equipment and supplies will allow you to manage and protect inventory in your warehouse properly.

Warehouse Inventory Protection

Cherry’s Industrial Equipment: Your Supplier for Storage Solutions

An efficient warehouse starts with proper inventory management systems. To properly manage inventory, you need the right tools to stay organized and keep track of all your goods. Warehouses need a variety of efficient and safe warehouse storage solutions, plus high-quality material handling equipment. That’s why warehouses like yours partner with Cherry’s Industrial Equipment for a variety of supplies that make it easier to move inventory and store and stock goods safely.

To keep your warehouse organized and better manage your inventory, it’s critical to have a wide variety of storage solutions designed to manage the diverse types of goods in your warehouse. Our selection of wire containers,bins and boxes give you convenient storage solutions that improve picking efficiency and inventory control.

Having all the right supplies on hand can also improve your ability to track and manage inventory. Plastic pallets are fundamental supplies that warehouses need to easily and safely move goods and keep them organized. For more efficient inventory management, warehouses also require pallet racking for the convenient and safe storage of palletized and containerized goods.

Pallet racking systems help ensure that all goods have a proper place and can also help streamline inventory management practices. To improve the functionality of pallet racking, warehouses can also use wire decking which will bring further safety to your facility and prevent product loss.

For more information on warehouse inventory management and storage solutions, contact a Cherry’s representative today. Our experts can discuss the right inventory storage and material handling solutions to increase your warehouse performance and productivity. Call us at 1-877-350-2729 or contact us online.

Improve Warehouse Management with the Right Equipment
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