In this digitized world, the warehousing industry, which is a part of the logistics industry, is growing at a rapid pace. Warehousing has become an integral part of small businesses and big retail giants because it improves order picking accuracy and cycle times. According to a survey, it is predicted that the global smart logistic warehousing market will be worth $11.5 billion by 2022, growing at a CAGR of 19.1% between 2017 and 2022.
Industry studies show that companies tend to outsource logistics functions such as warehousing because it is costly to build and maintain a warehouse. However, by implementing the latest techniques and practices of warehouse management in a cost-efficient manner, companies can still optimize logistic warehousing and its benefits while reducing costs.
Key Techniques of Smart Logistic Warehousing
Here are some of the key attributes of managing logistic warehousing operations smartly.
1) Minimize Inventory Levels at All Times
A wrong product reordering policy can cause unnecessary inventory levels and higher storage costs. Warehouse managers need to create an accurate forecast of demand for products, including those that are not used frequently, to avoid stockouts.
This will help prevent excess waste associated with excess inventory levels as well as allocation failures relating to inaccurate forecasting. Also, the costs associated with storing products that are not sold can be avoided, as well as the cost of having to reorder products later.
2) Opt for the Latest Technologies
The warehouse management systems (WMS) market is expected to grow at about 8% per year, which means that by 2022 it will cross more than $24 billion in revenue. The use of WMS will help automate inventory management, track items in real-time, and enhance the accuracy of demand-driven manufacturing, which is critical to the success of any warehousing function.
3) Implement Effective Warehouse Management Software
An automated inventory management system is necessary to handle complex business functions such as real-time stock updates, accurate forecasts for future demand, and intelligent decisions based on these forecasts.
Automated inventory management systems can help companies maximize their profits by reducing the overall time spent in managing inventory and warehouse space.
For example- companies can improve throughput, track daily activity reports, and optimize warehouse space utilization by integrating a WMS with facility management software.
4) Utilize Big Data for Decision Making
Big data analytics can help companies make intelligent decisions that will lead to improved business performance. Big data has the power to transform the way warehousing managers make decisions.
The real-time analysis of data collected at the warehouse can help managers find trends in demand patterns quickly, thereby improving business operations and customer service.
5) Make Use of Low Latency Technology
Latency is defined as an element that makes or takes part in some form of delay, as a relay station. While the primary goal of latency is to provide an undetectable delay, lately it has been used in warehousing operations to deliver real-time data.
At times, latency can have an adverse impact on warehouse operations but the same concept can be employed effectively if combined with big data analytics.
6) Make Use of Software-defined Radio (SDR)
SDR is a technology where wireless transmitters can be programmed with software, making them more flexible.
Warehouse managers can use SDR systems to carry out tasks such as locating products in real-time or even determining the size of batch shipments to customers. Thus, companies can benefit from significant inventory accuracy and efficiency.
7) Ensure Compliance with Customer Service Standards
Warehouse managers should take special care to meet all the quality and safety standards set by customers, especially retailers.
For example, Amazon warehouse managers must adhere to their internal policies for “Prime”, which means that products delivered will be free of damage or defects. Therefore, it becomes vital for companies to invest in unassisted robotics for sorting and picking out products from storage locations.
8) Promote Safe and Secure Working Conditions
Warehouse workers need to be provided with a safe and secure working environment, where they can practice the right measures of self-protection against accidents at work.
For example, safe levels of exposure to chemicals should be maintained while performing warehouse activities such as cleaning.
9) Engage in Effective Communication with Employees
Warehouse managers should have an open attitude towards all their employees to ensure better rapport.
Through the effective use of communication, warehouse managers can help boost employee morale, which will eventually lead to greater productivity. Also, they can share information about company operations and policies for implementing best practices learned through industry conferences and best-in-class companies.
10) Invest in Proper Inventory Management
Warehouse managers should make sure to invest in the necessary inventory management system, which will help them effectively manage their inventories.
For example, they need to buy software that helps streamline their supply chain activities including receiving, picking and shipping of goods. Also, investing in RFID tags for internal transportation purposes can help reduce the time required to locate, pick out and deliver goods.
11) Make Use of Barcodes
Barcodes are an important part of inventory management as they provide a quick way to identify items in warehouses. By using barcodes, managers can manage the warehouse better and improve efficiency.
For example, they can create a barcode for each product or item and add it to the inventory list. This will help store employees know the quantity and number of items stored at certain locations in the warehouse while using handheld scanners.
By implementing the above 11 practices, warehouse managers can ensure greater business efficiency resulting in higher profit margins. But it’s not just about profits; these practices aim to help companies to grow and strengthen customer satisfaction levels as well. So, adopting these ideas and acting on them is sure to result in growth for the company.