The impact that storage policies can have on your warehouse efficiency
Running a warehouse is certainly not an easy feat. With all those 
stocks or products that need to be stored, one needsto make the best use of the space available. This calls for planning and proper allocation. some key considerations also need to be taken into account. For instance, some raw materials may end up perishing if bought in bulk. This leads to wastage and a loss of funds that could have been used in other operations. Another key issue is the efficiency of the warehouse. You need to decide how to allocate the various storage locations to the various SKU’s (stock keeping unit). Thus, you need to consider the various issues in your particular warehouse so as to decide which storage policy is most suitable to apply. You need to take into consideration the various possible layout configurations, the dimensions of the warehouse itself, the types of inventory as well as the different SKU activity profiles.
Improving warehouse efficiency by reducing time wasted
Your primary aim should be placed on the need to reduce time wasted so as to improve efficiency, you can read more here. The best starting point would be to evaluate the distance travelled by the material handling equipment. Then, you should try to implement different storage policies and measure the amount of distance travelled and the respective time in each case. Afterwards, try out changes in picking time by implementing different policies. Based on these evaluations you can identify the best storage policy to apply in your warehouse.
The best plan is to find and implement the storage policy that minimizes the average time that is needed to store and retrieve an item. This same policy should also be able to satisfy any limitations that may be placed on the system.
Picking operations are also critical. In a study carried out in 2010, it was concluded that the travelling of the order picker is literally the most important factor. This is the most time-consuming activity of all. In fact in many cases it is usually estimated to be at some 50% of the whole operation. Therefore, amelioration’s to this activity, that is, in the picking operations, is the most obvious way to make improvements to increase the efficiency of your warehouse.
Based on these conclusions, let us now take a look at some of the main types of warehouse storage policies
First there is Dedicated storage, which is a situation where each SKU gets a storage location solely allocated to it. Thorough inventory activity profiling is required in these cases.
Then there is Randomized storage, whereby each unit from any SKU can be stored in any spot that is available.
There is also the Class-based storage. In this type of policy, SKU’s are grouped up into classes. Each of these is then assigned a dedicated storage area. However, SKU’s within a class are then stored according to randomized storage logic.
Obviously, these are best tried out in practice so that you will be able to ascertain which policy is most suitable to your personal circumstances. Take the time to try them out individually, evaluate each one of them, and compare and contrast them with one another, so as to ultimately choose the policy which will increase your warehouse’s efficiency the most.