Let’s break down five of the top strategies used by successful warehouse operators and 3PLs to improve warehouse operations. We’ll share concrete advice for improving your warehouse layout optimization, leveraging warehouse automation solutions, upgrading your inventory tracking system and more.
5 key strategies to improve warehouse efficiency
First, let’s define our terms. In a technical context, efficiency refers to the ratio between the amount of energy put into a process and the amount of useful work it produces. To be more efficient, you need to either reduce the amount of energy going in without reducing capacity or increase your capacity without increasing the energy going in. For the most part, warehouses have a hard limit on capacity. So, these strategies focus primarily on reducing the amount of energy that’s required, otherwise known as time and labor.
1. Optimize warehouse layout
Optimizing your warehouse layout is an effective way to reduce the time it takes to process orders and minimize disruptive congestion for equipment and staff.
Your slotting layout can be a particularly important element to focus on. One of the best strategies for slotting optimization is to organize your inventory by product characteristics, then position them accordingly in your facility. For example, products with a high turnover rate should be slotted close to the packing area, since packers will need to access them frequently. And the heavier a product, the closer its slot should be to the floor.
Of course, the more types of products your warehouse stores, the more complicated it becomes to optimize every single item. So instead of treating it like a tedious, unsolvable, DIY jigsaw puzzle, take advantage of modern technology like Logiwa IO’s Directed Putaway that can identify the best slotting strategies for your operation with the help of AI and custom algorithms.
2. Implement advanced inventory tracking
Advanced inventory tracking ensures your data is always up to date, preventing delays due to stockouts and sales-disrupting errors. It will also give you a real-time perspective on key metrics like:
- In-progress and completed order numbers
- Item locations, descriptions, and SKUs
- Inventory turnover rates
When inventory is tracked by barcodes and scanned as it moves through each phase of your operation, it opens up a world of actionable data – data that can help you identify not only when your order fulfillment efficiency is lagging, but also where you need to focus your resources to solve the problem.
3. Adopt a Warehouse Management System
Adopting a warehouse management system or warehouse management software (WMS) allows you to integrate all your operations (including layout management and inventory tracking) into a single, cohesive digital platform.
A WMS helps further reduce resource loss due to data translation errors by creating a single, authoritative source of truth. A top-quality WMS also offers advanced efficiency opportunities such as:
- On-the-go access to real-time data via mobile apps
- Rules for easy automation integration
- Smart job batching
- Real-time exception handling
4. Leverage technology and automation
Of course, if we want to talk about the top strategies for increasing warehouse efficiency, we can’t forget robotics and automated systems. While these technologies can represent a substantial upfront investment, their benefits are unparalleled. Thanks to advancements in AI and sensor technology, they’ve become reliable tools for reducing labor costs, increasing order processing speed and minimizing errors.
Take autonomous mobile robots, for example. These self-driving robots can navigate your warehouse freely without relying on tracks or guides. They can scan tags and automatically pick, sort and count inventory. In other words, they substantially reduce labor costs by cutting down on employee transit time within the warehouse, human error when picking and sorting and manual inventory counting.
5. Regularly review and analyze KPIs
Finally, tracking warehouse KPIs is critical to knowing if your existing efficiency measures are working and determining what measures to target next. But to get live, accurate numbers like cost per order, rate of return and inventory turnover, you need to have a strong data management system in place. Look for a WMS that can give you the greatest amount of detail in the most up-to-date, easy-to-access format. That way, you can be sure each adjustment you make to your efficiency strategies has the highest possible odds of success.
How Logiwa’s Warehouse Management System enhances efficiency
As we touched on above, a WMS is one of the most powerful strategies for improving warehouse efficiencies that you can employ. However, not all systems are created equal. To take full advantage of recent cutting edge advancements, don’t settle for anything less than Logiwa IO, our AI-powered fulfillment management system.
Comprehensive WMS features
Logiwa IO is a cloud native platform specifically tailored for high-volume B2C and DTC businesses. It makes tracking tens, even hundreds, of thousands of products as easy as opening an app. You’ll get real-time inventory visibility and seamless control of all your operations, whether you’re managing a single warehouse or a multi-warehouse network.
Seamless integration capabilities
From efficiency-improving technology like automated robots to various sales channels, ecommerce marketplaces, and commercial carriers, Logiwa IO offers seamless integration. It eliminates the manual data entry process, reduces human error and optimizes your automation capabilities to save you unprecedented time and resources.
Advanced automation and AI-powered processes
By leveraging the latest innovations in AI technology, Logiwa IO provides you with sophisticated algorithms for optimized picking, packing and shipping. Users can apply our pre-built automation rules or create custom rules to streamline even the most complex fulfillment processes.
Scalability and flexibility
Of course, businesses are always evolving. Fortunately, Logiwa IO was built to ensure you’re always in step with the times. Our scalable cloud infrastructure is built to grow with you, adapting to meet all your emerging business needs. Whether you’re aiming to expand into new markets or flexing to accommodate an increase in order volumes, Logiwa is there to support every major move.
Analytics and reporting tools
Through it all, Logiwa IO provides real-time access to all your critical data and offers actionable insights based on detailed analytics and reporting. By leaning into data-driven decision-making, you can prioritize your resources to pursue only the most effective improvement measures.
Leverage Logiwa’s WMS software for more efficient warehouses
Whether you opt for sweeping changes to your operation or decide to refine your efficiency a little bit at a time, Logiwa IO makes it easier than ever to monitor and manage your progress. With the data in hand and a robust suite of powerful, flexible integration options, operational excellence is well within your grasp.
As you assess your current operations and identify opportunities for improvement our fulfillment specialists are ready to help. Schedule time for a demo of Logiwa IO and let us show you just how big the possibilities are for your business.
FAQs about warehouse efficiency
When was the first WMS introduced?
It wasn’t until 1975 that the first WMS arrived on the scene. This first system was developed by a company called Logisticon for the clothing retailer JCPenney. From there, WMS have taken off to become ubiquitous among large warehousing operations.
What is the biggest cause of inefficiency for warehouses?
What are the most important warehouse efficiency KPIs?
On the fulfillment end, cost-per-order (total fulfillment cost/total orders) is usually considered the most important KPI. A cost-per-order number that’s trending downwards can mean a lower, and thus more efficient, total fulfillment cost.
