Warehouses serve as crucial hubs for the storage, handling, and distribution of goods. However, despite advancements in technology and management practices, warehouses often encounter bottlenecks that impede their efficiency and performance. These wide-ranging challenges can significantly impact a warehouse’s ability to meet customer demands and maintain operational excellence. Understanding and addressing these bottlenecks is essential for businesses looking to optimize their warehouse processes and drive greater productivity. Let’s take a closer look at four common holdups that you may be experiencing in your warehouse.
Delays in Order Receiving and Entry
Manual data entry errors, communication breakdowns, high order volumes, and supplier delays can all cause interruptions in order receiving and fulfillment. Mis-shipments, which include orders that never even make it out the door, can not only cause bad brand reputation and stress and low morale among employees, but it also creates a financial burden to businesses. In fact, businesses can face double the costs related to the pick time, incur return charges, push into the customer service time spent on the issue, and future discounts applied to the customer’s account to try and remedy. Multiple studies indicate that a single picking error can decrease the profitability of an order by up to 13%.
To reduce errors during the picking process and ensure order accuracy, warehouses should use barcode scanning systems, autonomous mobile robots, and consistent employee training, as well as ensure document visibility and accessibility (labels and SKUs must be legible). Packing stations should also be properly set up for maximum efficiency and free of clutter that may cause errors. Proper lighting, ergonomics, and access to shipping materials are all key factors in setting up packing stations within your warehouse.
Inefficient Picking Routes
Inefficient picking routes can have a cascading effect on warehouse processes, leading to lower productivity, higher costs, and decreased customer satisfaction. Optioryx, a Belgium-based integrated AI logistics operations platform, states that selecting the best picking route consumes around 50% of worker labor, which constitutes as 65% of the total operational expenses in a warehouse.
To optimize the picking route in your warehouse it is important to analyze the current process, pinpointing gaps, inefficiencies, and opportunities for improvement. Technology is a great resource as it can provide tools like heatmapping, slotting strategies and organization, data analytics, and performance metrics to assist in establishing picking routes that are best for your facility.
There are a variety of different solutions and systems to assist in warehouse picking, one of these is the pick to light systems. The pick to light system (PTL) is a technology that uses lights and displays to guide warehouse operators to the location of items that need to be picked for orders. The system consists of light modules installed at storage locations and a central computer system that communicates with the modules. When an order is received, the system activates the lights at the corresponding storage locations, directing the operator to the correct items. Once the item is picked, the operator confirms the pick, and the system updates the order status.
Lack of Automation
While automation can enhance warehouse efficiency by speeding up workflows, improving order fulfillment accuracy, and boosting profitability, many businesses still struggle with outdated or insufficient technology. While the upfront costs can seem daunting to business owners, hidden costs associated with manual processes can be substantial and damaging. It is important to ask: What is not having warehouse automation costing my company?
Numia Group, a warehouse and software solutions company, highlighted the obvious productivity increases when automation is applied, in traditional warehouses, workers typically have picking rates ranging from 50 to 100 picks per hour. However, by replacing paper-based picking with voice-picking technology, the same workers can achieve picking rate increases of 70% or more.
Conveyor systems, robots, drones, IoT, and sortation systems are all technologies that can assist in warehouse processes. Adding automation systems in your warehouse can also free up employees, not replace them, to focus more on value-added tasks and allow for upskilling and reskilling into new areas of the business.
Workforce Availability
Like in many occupations, COVID-19 changed the warehouse workplace dynamics and availability of employees. Compared to 5 years ago, 71% of businesses are finding it harder to find workers. Factors like competitive labor markets, rising wages, turnover, and unemployment have contributed to the challenge that warehouse teams now face when trying to find and keep talent.
Implementing and offering technology to support employees in their work functions is a key retention strategy. As the younger generation enters the workforce at a rapid pace, it is important that warehouses use new advancements and technologies that this demographic is well-versed in and want to use in their day-to-day work.
Flexible scheduling can also be used as an attractive offer to existing employees and/or potential new employees. Work/life balance contributes not only to the overall health of the employee, but also to productivity when they are at work. With “flex hours” business owners and warehouse managers can set specific requirements for working hours, for example: employees must clock in no earlier than 6 A.M. and may finish work no later than 8 P.M. Now the employee gets decision-making ability and the option to handle personal obligations without jeopardizing their work and schedule, resulting in fewer sick days and less no-shows and time-off requests from team members.
