Helpful Tips for Improving Warehouse Efficiency While Reducing Costs
The cost of labor for warehouse and manufacturing facilities is increasing. With minimum wage on an upward trend, finding ways to increase productivity is a must.
The good news is, there are several tips to use to increase warehouse productivity with some of the most effective ones found here.
Increase Available Floor Space
Are warehouse workers constantly being caught in traffic jams inside the warehouse? Do the items being stored take up too much floor space?
If so, there’s a smart solution to consider. It’s to contact a mezzanine floors supplier. By installing these floors, your storage can be taken up, rather than out, expanding the available working space present.
This is going to help increase worker productivity significantly.
Control the Inbound and Outbound Freight
If you want to prevent profit erosion, this is something you have to focus on. A great way to achieve this goal is by using a consultant. They can help you competitively bid.
While most carrier agreements are considered proprietary, an experienced consultant can help to identify areas where negotiations can be made without impacting service levels in a negative way.
By offering incentive pay for employee performance, you can increase overall labor productivity significantly. Remember, over 50 percent of the labor force of a warehouse is going to be pick and pack, so this is a great place to start.
However, you need to make sure you aren’t paying for productivity you are already getting or that you could get in other ways.
Simplify Processes to Reduce Touches and Minimize Costs
In past years, have you begun to layer new functions over the older, pre-existing ones? Do order flow and product flow no longer make much sense and crisscross over the floor?
If so, it’s time to take another look at the physical processes in place and the steps necessary in order fulfillment and product flow. In most cases, if you can reduce the number of steps, it results in a reduced number of touches, resulting in reduced costs.
Manage and Measure
Do you manage or even capture the critical KPIs of your organization? Do you know the critical productivity or the costs for shipped orders, cost per line shipped, or cost per box?
If you don’t have or measure these critical metrics, then how can you assess or put in place any cost reduction processes? You have to have a baseline or there’s no way to know what errors or returns are costing you.
Once you have established these things, you can create feedback and share it with workers. They are going to respond and begin to give a higher level of productivity.
Train and Develop Better and More Skilled Frontline Mangers
An effective manager understands it’s all about execution. The ability they have to efficiently manage all the aspects of the fulfillment process is going to significantly impact your costs, overall worker morale, and the quality of order fulfillment for customers.
Do you know the managers’ needs? Would exposure to other parts of your business help them to better understand your vendors, customers, and merchandise? It’s essential for you to utilize the training resources available locally or online to improve your front line managers effectively.
Improving Warehouse Efficiency: It’s Possible
If you want to improve your warehouse efficiency and increase revenue, you need to implement the tips and recommendations found here. Doing so is going to help ensure the desired results are achieved for your facility.
When necessary, use the services of a consultant or other professional to help you find other areas where you may be able to improve performance.