Partner Article by Justine Cross, Brightpearl
Despite effective warehouse management bringing a vast number of benefits to eCommerce businesses, only 26% of company managers view warehouses and distribution centres as an asset which can drive growth for their business.
As the eCommerce industry becomes more and more competitive, merchants everywhere are seeking new ways to keep up with large brands like Amazon, especially when it comes to fast fulfilment and speedy shipping.
One simple way to achieve this is to operate from an efficient warehouse. In order to do so, consider this advice.
Before you even start thinking about how efficient your warehouse is, you need to ensure your recorded inventory availability is accurate across all your systems, including your eCommerce marketplaces.
You’ll need to perform a complete stocktake, ensuring your eCommerce channels, inventory management software, warehouse management system and accounting all match one another.
If you’re operating from a single back office solution, like Brightpearl, you should find that updating one system updates the others. However, if your systems aren’t integrated, then you may need to spend more time on this step in order to obtain accuracy in your inventory.
You should also ensure all of your products are uniquely barcoded, as this will save time and speed things up throughout your warehouse processes, so take the time to do this now if you haven’t already.
Once your initial stocktake is completed, it’s then recommended that you manage your inventory in the future with a cycle count, which is a way of splitting your inventory into batches that need to be counted.
High risk, high value and the ABC method are all effective ways of using cycle counts within your warehouse.
Picking & Packing
Ensure your warehouse staff are given barcode scanners so that they can speed up the picking and packing processes.
With a warehouse management system in place, your staff should find that any mis-picks set off alerts on their handheld devices.
It should also be possible to scan goods as they are packed, ideally updating your eCommerce channels and each on-hand inventory availability figure as you do so.
Not only will you be expecting deliveries from your suppliers on a regular basis, but returns are also inevitable.
Did you know that, on average, it takes 7 employees to touch a returned order before it’s completed? That’s too much time, and resource, spent on an activity that doesn’t promote increased revenue.
To combat this, ensure your staff are equipped to manage incoming inventory with a quick barcode scan, and that your warehouse layout promotes fast re-shelving, and thus, faster resales. We’ll touch on warehouse layout shortly.
And for the instances when you need to write-off damaged inventory, or quarantine them ready for assessment later on, your staff should be able to easily make this decision and update your systems appropriately as they’re scanning items in.
Certainly in the case of write-offs, you’ll need to have a process (or integration) in place that also automatically updates your accounting and financial reports, so bear this in mind when implementing a new WMS solution or when optimising your existing one.
When it comes to your staff finding products on your shelves, and returning items to shelves quickly, an effective warehouse layout is crucial.
Your warehouse should be so easy to navigate, that even a brand new employee could make sense of it within just 5 minutes. This cuts training times as well as picking times.
Consider these quick-fire tips for an effective warehouse layout:
● Group similar items together in the warehouse
● Place best selling items near the packing station
● Designate specific areas for peak season products, on sale items and best sellers
● Barcodes should face outwards from shelves and upwards within bins
● Utilise vertical space with stackable shelf bins, industrial shelving or mezzanine shelving
Making changes within your warehouse is just like making changes in any other part of your business.
You need to test the changes, analyse your metrics and then make changes again if things aren’t running as smoothly as you’d hoped.
Some warehouse-specific metrics you should keep an eye on are:
● Time to Ship: How long does it take for you to ship customer orders after the order creation date?
● Perfect Order Rate: Are your customers receiving the right products? And in the timeframe and condition that was promised?
● Processing Cost Per Order: How much does you cost you to ship each order out of the door?
It’s also recommended to keep an eye on other industry-standard warehouse reports, such as your empty bin report and history by supplier.
These reports and metrics will all ensure that the changes you’re making are the right ones. But as with any other part of your business, keep making changes until you have an efficient warehouse in place, and a turbocharged eCommerce business.