How small and medium sized warehouses can thrive

Warehouse managers face a difficult situation – costs, for everything, are rising – and demand – for most things – is increasing. This means that warehouse space has to contain more stock, operate more rapidly and still deliver efficiently. Warehouse rental cost has surged up since the pandemic which means that many small warehouses are attractive propositions because they cost less, as long as they can operate effectively. However, small and medium sized warehouses also have some distinct advantages over their larger counterparts, when used appropriately.

Mobile solutions support small warehouse operations

It’s a given that smaller warehouses have smaller teams of staff. This means that people are more likely to be multi-tasking and covering more activities than those in bigger warehouses who make have a much more limited range of duties. This means that adopting mobile solutions such as scanners, smartphones and tablets, and even mobile printers, can substantially improve the efficiency of a small warehouse space, boosting productivity. This means that wi-fi coverage is vital and consideration will need to be given to issues like battery life of mobile products so that they can continue to help operatives fulfil their tasks. Mobile workstations are valuable in small warehouses because they can be moved to where they are needed, and also they can be used as a docking centre, allowing personnel to charge RFID scanners or tablets as they work.

Calculate current warehouse space to ensure you’re using it effectively

There’s a simple process to finding out how much usable warehouse space you have. You should already know the square footage of your warehousing, simply multiply that by the clearance height to get the useable warehouse size. To find potential storage capacity, multiply the length, width and height of your existing racking. Now divide the potential storage space by the cubic volume of your warehouse itself to discover the percentage of usable space available. The general rule is that storage space should be no higher than 27 percent, and no lower than 22 percent. Higher storage space can lead to higher labour costs, because it will take your team longer to fulfil their tasks in constrained and potentially unsafe surroundings. Lower than 22 percent and you’re underutilising your storage potential and wasting capacity. Remember the Pareto Principle – also known as the 80/20 rule. In warehousing, this means 80% of sales will probably come from 20% of stock. Locating this 20% closest to packing areas will minimise search time, improving efficiency.optimise your small and medium sized warehouse

Explore inventory slotting

For small and medium sized warehouses, inventory slotting can be a huge strategic benefit. Slotting requires a wide range of data and then decides the optimum location of every SKU and also the nature and size of the storage medium to contain it. It’s a process that can be reviewed regularly, perhaps annually, to continue to improve warehouse performance. Inventory slotting is the methodology that best supports the Pareto Principle. Good inventory slotting also benefits your logistics – knowing where your goods are, and being able to access them rapidly, allows for orders to be picked and packed without delays or mistakes.

Minimise aisles and use smaller equipment

One obvious but often overlooked improvement for small and medium sized warehouses is aisle minimisation. Standard aisle measurement is 12 feet, which allows for turning circles etc. However, there are a number of approaches that can work well with narrower aisles such as double racking, which allows you to place twice as many pallets on racks, utilising specialist equipment to reach into these double deep spaces and allowing pallet storage to be your predominant form of warehouse management. Automated guided vehicles (AGVs) are also useful in narrow aisle warehouses, as they both reduce personnel use, move stock efficiently and give a better return on investment as they tend to be electric; utilising mains power or rechargeable batteries rather than fossil fuels. Drive-through racks can be used with narrower aisle, and these permit a fork lift to enter the racking and access space from both the front and the back of the racking.

Control inventory creep

Another major advantage that small and medium sized warehouses have is that they can find it easier to manage inventory creep. This is the process of filling up corners and under-utilised spaces of the warehouse with stock that is out of date, unwanted or otherwise not moving from warehouse to customer. Regularly clearing aisles, evaluating slow moving stock and removing outdated equipment and technology can help keep small warehouses more efficient than their larger counterparts.

Evaluate storage in small warehouse spaces

In small warehouses, space is at a premium. If you regularly have empty pallet storage bays, if storage bins and racks are the wrong size for existing inventory, you are wasting your most valuable resource. Matching inventory and demand rates to storage space is one way to improve your storage solutions. If low level pallet storage is underutilised it can be converted to carton flow racks which create efficient order picking. Vertical carousels are another option – especially if your warehouse has a range of small items that can be conveniently stored in vertical space. Alternatively a mezzanine can be used for equipment storage, office space etc. In some small warehouses, over door storage can be an option, although this needs to be carefully considered in terms of safety.

Apply 5S to your small warehouse space

5S is a methodology designed to create clean, efficient and safe working environments. Arising from Toshiba’s manufacturing philosophy, it can be applied to small warehouses to optimise performance. The 5S principles are:

  1. Sort – which means getting rid of rarely used stock, or equipment to free up usable space
  2. Set in Order – reorganising the remaining inventory and equipment based on efficiency
  3. Shine – ensuring warehouse space is free of clutter, clean and well lit reduces injury risk and speeds up activity
  4. Standardise – create operating procedures that standardise the previous three principles so that they become habitual to all employees
  5. Sustain – keep the four preceding principles in place by ensure all staff are training in them and by creating an assessment process that measures management against them.

Small warehouse principles in practice

Using some or all of these ideas will improve small warehouse management, upgrade storage and create great efficiency in performance. This creates time and space to let your warehouse flourish.

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