THE ULTIMATE GUIDE TO
1. Introduction to Warehouse Storage
What is warehouse storage?
Warehouse storage is storing tangible goods or items in a dedicated facility. As part of the supply chain process, warehouse facilities store items for a short-term or long-term period before distribution throughout the supply chain to the end user, such as a retailer.
Some facilities may specialise in storing particular items, such as pallet loads or perishable goods. Such storage facilities will either be owned or rented by a business from a specialist warehouse storage provider. Inventory management and order fulfilment are two significant warehousing functions.
The process of storing goods on a large scale for commercial purposes is sometimes referred to as warehousing. A warehouse will use different components and storage systems to ensure the safe storage and efficient handling of items.
What are the key components of warehouse storage?
People may not realise that there’s much more to warehouse storage than simply storing and preparing goods for distribution. Effective warehouse storage will use several key components that improve operations’ efficiency, safety, and reliability.
Some of the key components of warehouse storage include:
- Inventory management – Keeping a record of the inventory entering and leaving the facility makes tracking items much more straightforward. Any changes in storage should also be monitored.
- Space utilisation and layout – effectively using the available space can increase storage capabilities, including where items will be stored inside the warehouse. Different layouts can also be considered for better space utilisation.
- Storage systems – using the appropriate storage system to safely and securely store items to minimise the risk of injury or damage.
- Warehouse monitoring systems – the backbone of effective order fulfilment, a WMS improves the efficiency of order fulfilment and management through tracking systems and labour utilisation.
- Warehouse staff – warehouse staff are the fundamental element to successful warehouse storage operations. Robots do not operate warehouses. Instead, technology will work alongside staff to improve efficiency and accuracy.
What are the benefits of warehouse storage?
Why should you use warehouse storage? There are many benefits businesses can gain if they utilise warehouse storage. Whether the business owns a facility or uses a third-party provider, here is why companies should leverage warehouse storage:
- Create more space
- Better security and protection
- Less risk of damage
- Improved supply chain efficiency
- Save money in the long-term
- Utilise other available services, such as pallet distribution
- Provides a centralised storage location
The Role of Warehouse Storage
Warehousing plays a crucial role in the management and efficiency of the supply chain. With effective storage solutions, the supply chain process will be faster and more effective at meeting demands.
Storing items in a centralised location also make planning distribution throughout the supply chain much easier and more manageable. Otherwise, businesses will have difficulty satisfying customers and delivering quality service.
With warehouse storage, businesses can achieve the 7 Rs of supply chain management. That is getting the right product, in the right quantity and the right condition, to the right place at the right time, to the right customer and the right price. That’s a lot of rights!
2. Importance of Efficient Warehouse Storage
What is efficient warehouse storage?
Efficient warehouse storage is vital for the supply chain to fulfil demand and ensure customer satisfaction. Efficient warehouse storage involves adopting processes and technology that help improve the speed, reliability, and safety of warehousing operations.
Why is efficient warehouse storage important?
There are several reasons why efficient warehouse storage is important. Firstly, it reduces operational costs by reducing time and errors in pick & pack operations and distribution. Necessary goods can be found quicker and prepared for distribution without delays.
Space is limited, which is another important reason for efficient warehouse storage. Over time, a warehouse can be adapted to make much more efficient use of the space available while still ensuring the safety of goods. Otherwise, valuable space can be taken up, which limits the storage capabilities.
Warehouse employees will also benefit from efficient warehouse storage. Employees are more motivated and productive by implementing the technology and procedures to improve efficiency. Ongoing training is essential for improving productivity and efficiency.
Processes for Warehouse Storage Efficiency
There are several processes a warehouse facility can implement to improve efficiency. These include:
Streamlined operations and productivity
Improving workflows and warehousing operations by identifying and removing tasks or processes that slow operational efficiency. Productivity and efficiency can improve by implementing automation or eliminating processes.
Streamlining operations and productivity can include efficient inventory management, handling time and cost minimisation, and the impact of efficient storage of order fulfilment.
Enhanced inventory management
Inventory management is a key component of warehouse storage but can also slow down efficient warehouse storage processes. Improving and enhancing inventory management is essential to more reliable stock control.
Enhanced inventory management can be improved through real-time monitoring, implementation of inventory tracking systems, and efficient stock control.
Space utilisation and cost efficiency
Space is everything when it comes to storage. Improving space utilisation not only frees up more room for storing more, but it can increase revenue too. There’s much more to space utilisation than choosing where items will go. It requires careful planning and consideration.
Optimising the warehouse layout, use of storage systems, and maximising the available space are all ways to improve space utilisation and cost efficiency.
Better order accuracy and customer satisfaction
Order fulfilment is another core element of warehousing. Mistakes can happen, costing the service provider and businesses time and money. Reducing order fulfilment errors and improving accuracy are important for better customer satisfaction.
Improving and optimising warehouse management systems (WMS), easy retrieval of items, minimising processing errors, and achieving order fulfilment all contribute to better order accuracy. It also helps improve customer satisfaction and brand reputation.
Effective inventory tracking
Inventory tracking is vital for monitoring the contents, quantity, and location of goods stored in a warehouse. Effective inventory tracking makes it easier for businesses to monitor goods throughout the supply chain and ensure that stock levels are managed correctly.
Maintaining accurate inventory levels, data-driven forecasting, and stock rotation are all methods for effective inventory tracking.
Risk mitigation and safety
Warehousing comes with risks and safety concerns that can affect the efficiency of storage operations. Physical injury, trip and fall hazards, or health & safety training are all factors that can affect efficient operations.
Consider damage prevention through proper storage, minimise accidents by clearing obstructions and trip hazards, alongside reviewing and abiding by regulations and laws for risk mitigation. Item safety should also be considered by implementing theft protection methods.
3. Common Challenges In Warehouse Storage
Warehousing operations can encounter many challenges that affect warehouse storage’s efficiency, reliability, and safety. Overcoming these challenges is crucial for improving the supply chain.
Insufficient storage space
No warehouse wants to run out of available space. After all, warehousing relies on space to store goods properly. But sooner or later, a warehouse will start running short on available space, whether physical space or suitable racking systems.
Planning and effectively using the space available, alongside choosing appropriate racking systems, can help overcome space restrictions and make more effective use of an available area.
Another problem with insufficient storage space can result from inefficient layouts. Finding the balance between storage systems and access can take time and effort. A poor layout can also cost money due to less available storage space.
Optimising the warehouse layout by reviewing and analysing storage space can help overcome warehouse layout problems. Utilising vertical space alongside horizontal space is another solution.
Inaccurate inventory management
Inaccurate inventory management can create problems affecting supply chain efficiency, including missing items, overstocking or understocking items, and insufficient space. Solving inaccurate inventory management problems takes up valuable time and resources.
The outcome of inaccurate inventory management includes shipment delays due to insufficient stock quantities, misplaced items, or longer lead times while waiting for order fulfilment. Implementing a warehouse management system with a focus on inventory management will prevent such problems from occurring.
Inadequate monitoring and tracking systems
Monitoring and tracking items during the warehousing process are crucial for supply chains. Failing to monitor and track items properly can lead to human error, unaccounted stock, and the potential of missing items.
All warehouses should implement a monitoring and tracking system to identify, account for, and properly store the exact contents. It also reduces errors by making it easier for items to be located.
Order fulfilment issues
One warehouse operation likely to experience the most problems is during the pick and pack process or order fulfilment. It’s easy for issues or mistakes to happen when items are picked from different locations and by multiple people.
Again, implementing an effective warehouse management system can reduce the risk of errors alongside increasing productivity. It also reduces the risk of pick and pack operations preparing and sending inaccurate shipments.
Training and safety
Labour costs are among the highest operating costs of any warehouse, so productivity is vital for maximising warehousing operations. A lack of training and safety procedures are two factors that can significantly affect employees’ productivity and motivation, decreasing supply chain efficiency.
Providing sufficient training in warehouse operations and handling, alongside implementing safety procedures and guidelines, can overcome this common warehouse storage challenge.
Technology is continually advancing and evolving, including warehousing technology. Whether it be data management, automation, or implementing inventory & order processing systems, technology can significantly affect efficiency and operations.
But this relies heavily on successful implementation and incorporation into current processes. Often, technology is improperly implemented, leading to clashes or confusion. In addition to this, new technology can sometimes experience teething problems, which can lead to further frustration and delays.
Gradually implementing technology systems provides time to check how effective such systems are and whether any changes are necessary. It also provides staff sufficient time to understand how such systems work to prevent challenges.
Demand constantly changes, with seasonal and economic demand being the most significant fluctuation. These changes in demand can make it challenging to forecast inventory requirements. Such fluctuations could result in insufficient or excessive stock in a warehouse.
The importance of addressing warehouse storage challenges
Identifying and addressing warehouse storage challenges is crucial to improving the supply chain and ensuring long-term success. Without overcoming the common challenges outlined above, lead time can increase, and customer satisfaction can be hit hard.
No one likes to be kept waiting, especially nowadays with quick delivery services now the norm. Failing to overcome such warehouse storage challenges can unnecessarily increase delays. Delays that increase costs and minimise the efficiency and effectiveness of warehouse operations.
When adverse outcomes arise from warehousing mistakes or challenges, brand reputation and trust can also be significantly harmed. Employee productivity and motivation may also suffer due to improper or overstretched operations. That’s why addressing the challenges above is essential.
4. Key Factors to Consider for Effective Warehouse Storage
The layout and space utilisation are among the most important factors for effective warehouse storage. Carefully considering the design and layout of storage systems while providing sufficient navigation space is crucial for determining how much you can store inside a facility.
There are three warehouse layout choices to pick from:
- I shape is most favoured by larger warehouse facilities due to the layout being ideal for high volume. Receiving is at one end of the I layout, while shipping is at the other end, with two staging areas accompanying both. The middle of the I layout is for the storage area.
- L shape layout is the least used of all layouts due to its unusual layout. Receiving is on one side of the layout, followed by shipping on the adjacent side at a 90-degree angle. Staging accompanies both before the storage area in the middle.
- U shape is the most common layout and is considered the best for starting. The U shape involved a layout where components are arranged in a horse-shoe-like configuration. Receiving and shipping are placed on parallel sides at the top of the U shape, followed by staging. Storage forms the base of the U shape and covers the most significant area.
Another factor to consider for effective warehouse storage is inventory classifications. Items entering the warehouse should be stored according to their classification. You can choose from different classification types, including top-level entry types or ABC classification.
Top-level entry types involve the classification of items into four categories for storage. These are raw materials, work-in-progress, supplies, and merchandise. Classifying into these four simple categories allows for better inventory control and improved inventory management,
Alternatively, the ABC classification system can also be used. Based on the Pareto Principle, ABC classification follows the principle that 80% of revenue is generated from 20% of products. Items are then classified and stored based on the value of each unit.
Inventory monitoring and tracking systems
Inventory monitoring and tracking systems are vital tools for effective warehouse storage. Efficient warehouse storage relies on knowing which items are in storage and where. Monitoring stock levels in real-time can also help too.
Gone are the days of manually tracking inventory, which was prone to errors and mistakes (not to mention time-consuming). Today monitoring systems are automatic, removing the laborious and intensive job of checking a warehouse’s inventory.
Implementing a successful inventory monitoring and tracking system saves time and money. Processes are easier and quicker due to a fast and reliable monitoring system. The same goes for tracking systems. Now, it’s much easier to locate and monitor the location of items.
Inventory accessibility and retrieval efficiency
Considerable time is spent by warehouse staff travelling to the location of stored items. This time is consuming and could be better spent on other areas, such as pick and pack. Inventory accessibility and retrieval efficiency automate and speed up part of the process.
Workers no longer need to spend around 60% of their time walking and searching the shelves for the required items. Implementing automation means machines do the time-consuming travelling and picking, taking items back to the operator in a quarter of the time.
Material handling in warehousing involves moving and protecting items throughout the storage process. Usually, material handling requires equipment due to the size or weight of stored items. Such equipment improves efficiency and safety in the warehouse.
Material handling equipment varies considerably, from small trollies and hand trucks to larger forklifts and pallet trucks. Using appropriate material handling equipment minimises the risk of damage during handling.
Safety procedures and security measures
Given the large quantities of items stored in a warehouse, safety procedures and security measures are necessary to protect staff and the stored items. All warehouse facilities should have safety procedures based on regulations and laws to protect employees’ safety and well-being.
Security measures should also be implemented to protect the large quantities of equipment and items stored in the warehouse. Using multiple security measures, such as alarms, CCTV, and security patrols, minimise the risk of theft or vandalism.
Warehouse facilities that form part of an FMCG or e-commerce supply chain must be flexible to adapt to the quick changes often experienced in such industries. Improving the flexibility of a warehouse can ensure operations are efficient to meet the changing demands.
Flexible warehouses should be easier to adapt and change based on the current demands. For example, volatile supply chains may require storing a range of goods or a larger quantity than expected.
To create a flexible warehouse space, consider these steps:
- Plan and organise your warehouse space.
- Create separate zones or areas according to different needs or requirements.
- Implement quality storage systems that make the most of the available space.
- Consider integrating autonomous robots and machines.
- Manage and optimise warehouse traffic.
Environmental considerations should also be considered for effective warehouse storage. Certain items may have specific storage requirements, such as temperature or humidity. In this case, climate-controlled warehousing is vital to persevere item quality.
Usually, climate-controlled warehouses will have special environment control systems or equipment in place to adjust the environment accordingly. This ensures that the interior environment is consistent and ideal for the item requirements.
Warehousing is never a standalone process. For effective and efficient warehouse storage, continuous improvement should be implemented.
Continuous improvement results can be small incremental, or large, significant changes. Any changes that are made, however, should improve warehouse processes. Continuous improvement in warehousing can be implemented across a range of areas.
Areas to consider implementing continuous improvement include:
- Workforce training and skills
- Space utilisation and layout
- Warehouse management systems
- Safety procedures and processes
- Technological advancements
5. Overview of Different Types of Warehouse Storage Systems
What are warehouse storage systems?
Warehouse storage systems are a range of storage structures designed for better optimising storage space in a warehouse facility. Depending on item size, weight, scale, or available space, storage systems come in different types.
Why are warehouse storage systems important?
Using warehouse storage systems is vital for improving a warehouse facility’s efficiency and space utilisation. Choosing the right storage system ensures that you maximise each square foot of storage space while still providing easy access. Using storage systems also minimises the risk of damage to goods.
What are the different types of warehouse storage systems?
The first warehouse storage system is pallet racking or racks. Pallet rack systems are a common feature of large storage facilities ideal for pallet distribution and delivery. However, they are also recommended for smaller and medium-sized facilities, as many pallets can easily be moved together.
Pallet racks are adaptable to store different unit loads, volumes, or weights, making it a versatile solution for various items and pallet sizes. Pallet racking is usually made from wood, metal, or plastic and can support many pallets at any one time.
Shelving and Mobile Shelving Systems
Shelving systems are another type of warehouse storage system. Available as static or mobile shelving, shelving systems are ideally suited for storing small items with a continuous replenishment cycle. Static shelving can be used in warehouses of any size.
Static shelving systems stay in one fixed position and cannot be moved around. In contrast, mobile shelving systems are designed to maximise space efficiency by eliminating individual aisles for each shelving system. Instead, multiple shelving units can be accessed from one aisle.
That’s because mobile shelving systems can be controlled to access a particular aisle when needed. The shelving units slide autonomously along floor rails, providing smooth and safe movement. While mobile shelving systems can be used anywhere, they are ideally suited for cold storage.
Mezzanine storage is another type of warehouse storage system you can implement. Ideally suited for smaller facilities, mezzanine storage adds additional floor structures constructed above the main floor, providing extra storage levels.
Mezzanine storage systems can be expensive, but they can be customised with lighting, conveyor belts, and lifts. Warehouse workers can access each mezzanine level without any restrictions.
Automated Storage and Retrieval Systems
Automated storage and retrieval systems (AR/RS) is another warehouse storage system that has significantly advanced over recent years. Once too expensive for smaller warehouse facilities, AR/RS technology is now a widely popular storage system.
Consisting of a range of different technologies, AR/RS is designed for buffering, storing, and retrieving items on demand. Different AR/RS technologies include autonomous mobile robots, vertical lift modules, shuttles, loads, and stockers.
Implementing AR/RS helps with space utilisation and can use unused vertical space. Various speeds and sizes are also available, providing flexible options based on your warehouse premises. Worker efficiency can also be improved by implementing AR/RS.
Cantilever racking is another warehouse storage system specially designed for storing long items, such as piping, wood planks, or plastic sheeting. Made with a 2-column base, load-bearing arms are attached to hold items safely.
With cantilever racking, the arms can easily be adjusted and moved on the column bases according to the storage requirements or item size. As these racks are open, direct access to items is provided. Most commonly seen in storage facilities for automotive, machinery, and home décor.
Flow Racking Systems
Flow racking systems uses elevated rails and dynamic components to create a high-density storage solution for pallet loads. As wheels or rollers support each rack, loading pallets onto a flow racking system is much easier to handle.
Flow racking systems are ideally designed for first-in, first-out, or last-in, first-out flows. Goods with a high or medium turnover are also ideally suited to flow racking systems and can be adapted to suit different unit loads.
Automated Vertical Storage Systems
One more warehouse storage system you can choose from is an automated vertical storage system. A great space-saving storage system, automated vertical storage systems are suited to a wide range of products.
These storage systems can also be customised to suit different sectors, item heights, payloads, sizes, or options. Using an automated vertical tray system, these storage systems use a goods-to-man approach, drastically reducing time moving around storage facilities.
6. Best Practices for Optimising Warehouse Storage
Continually Analyse Available Space & Layout Plans
One of the best practices for optimising warehouse storage is to continuously analyse the layout and available space. Not only can constantly analysing and optimising layouts and available space be beneficial for space optimisation but also employee productivity.
Other benefits you can gain from space utilisation are better warehouse profitability, efficiency, and productivity. Calculating space utilisation is easy and only requires two figures: total storage space and occupied storage space.
Then, divide the occupied storage space by the total storage space to get your space utilisation figure. The higher the figure, the better. If the figure is low, consider adjusting the layout and storage systems or implementing different inventory management techniques.
Utilise Efficient Inventory Management Systems
Inventory management is another area to consider for optimising warehouse storage. Utilising efficient inventory management systems (IMS) can improve supply chain efficiency, minimise errors, and more efficiently manage and control inventory stock levels.
Many warehouses just starting out may use a manual spreadsheet or adopt an ad-hoc approach to inventory management. This can lead to mistakes, overstocking, or understocking. A situation that reflects poorly throughout the entire supply chain.
Modern and successful inventory management must rely on more efficient methods. Implementing an efficient IMS can save both time and money.
Implement ABC Analysis
Implementing ABC analysis is another best practice to consider for optimising warehouse storage. ABC analysis is an inventory control method that categorises inventory based on significance. Determining the value of the stock can help demand forecasting and customer satisfaction.
Firstly, group A categorises inventory that is high value and with the highest annual consumption value. Secondly, group B categorises medium-value inventory with a small yearly consumption value. Lastly, group C categories inventory that is low value and has a low annual consumption value.
Use Vertical & Horizontal Space
Another best practice for optimising warehouse storage is to use vertical and horizontal space. Not only will an effective warehouse make the most out of horizontal space, but it will maximise available space using vertical storage too.
Vertical space is a hidden resource many warehouses don’t utilise, providing a golden opportunity to make better use of current space. After all, floor space is expensive, so it would make sense to tap into unused vertical space.
While you could start implementing mezzanine floors, this soon mounts up cost-wise. Instead, plenty of other storage systems can be used that can safely and securely store inventory. Consider implementing vertical carousels and racks for a much more cost-effective vertical storage solution.
FIFO & FEFO
An inventory management practice to consider for optimising warehouse storage is FIFO & FEFO. Standing for First-In, First Out or First Expired, First Out, these practices involve an inventory stock rotation method that ensures no stock is left for long periods.
FIFO can be used for a variety of stock, while FEFO is more focused on food goods, ensuring that no wastage occurs from inventory passing an expiry date. Both racking systems and inventory management software can help with these practices.
Improve & Optimise Slotting
Warehouse slotting is organising and categorising inventory to improve picking and stock control efficiency. By improving and optimising slotting, warehouses can benefit from better space utilisation, minimising travel time to inventory, and reducing errors.
There are three ways to improve and optimise slotting practices. These include:
- Inventory reorganisation
- Incorporate slotting throughout warehouse processes
- Implement an effective warehouse management system
Organise and Clean Storage Spaces
Organising and cleaning storage spaces is another best practice for optimising warehouse storage. Cleaning and organising storage space is essential and should be carried out in every facility and entails more than just improving the environmental aesthetics.
Warehouse spaces that are clean and organised reduce health and safety risks, minimise the risk of inventory damage, increase employee productivity, and reduce maintenance costs. The increased efficiency from organised and clean spaces can also reduce waste too.
To keep a warehouse space organised and clean, specific tasks should be carried out daily, weekly, monthly, and biannually.
- Floor sweeping
- Recycling waste
- Cleaning and spillages
- Removing trip and fall hazards
- Clear obstructions
- Removing empty pallets
- Storing empty containers
- Thoroughly cleaning floors
- Testing and cleaning ventilation systems
- Dusting shelving unit and rafters
- Serving handling equipment
- Removing old stock and unnecessary inventory
- Upgrading storage units
- Floor stripping
Employee Training & Empowerment
Training and empowering employees is another best practice for optimising warehouse storage. Providing sufficient training in operating procedures or skills can improve employee productivity and motivation. It also increases efficiency and reduces costs in the long term by lowering turnover.
Secondly, empowering employees can also increase productivity and motivation. Empowerment includes allowing employees to make individual decisions and act on them. Giving employees a degree of autonomy can also speed up the process and result in a stronger bottom line.
7. Emerging Trends In Warehouse Storage Technology
Automation technology is one of the fastest-growing trends in warehouse storage. Successful implementation of automation will work alongside warehouse workers, not against them. Effective automation technology can take over repetitive, laborious, or time-consuming tasks.
Implementing process automation successfully increases the efficiency of operations and improves employee productivity. Tasks that automation can fulfil include moving heavy loads, accurate pick and packing, and warehouse management systems.
Internet of Things
The Internet of Things (IoT) combines physical objects with internet-connected technology. For example, IoT in a warehouse may involve sensors integrated into storage systems that can pinpoint inventory a warehouse worker may be looking for.
If warehouse facilities want to keep up with growing demands, it is essential to implement IoT technology. Successful implementation improves productivity and process efficiency. It also improves management processes too.
Robots haven’t taken over warehouse storage, but artificial intelligence significantly improves automation processes. AI in warehouse storage acts as a central brain that processes information and initiates processes accordingly.
Through machine learning, warehouse operations can be significantly improved. Using algorithms and machine learning, AI can make informed decisions for better operational and inventory management efficiency, such as reducing the time to pick and pack orders or wearable technology.
AR and VR
On a similar theme of AI, augmented reality and virtual reality are other emerging technologies in warehousing. Augmented reality can be integrated to optimise processing and inventory control.
Achieved through smart glasses, each worker can benefit from optimised procedures and processes, minimise errors, and speed up operations. AR technology, such as barcodes and visualisation, are examples of how AR implements into warehousing.
Virtual reality is also playing a role in warehousing. VR provide simulated experiences or environments that can aid and improve warehousing processes. By visualising a space, space optimisation, training procedures, and order fulfilment can all be enhanced through VR.
Imagine Alexa in warehousing being able to act upon a voice command. Well, voice technology has made it happen. Using voice picking, employees can use voice prompts to instruct picking task operation and guide them to the designated picking location.
Cloud computing is another emerging trend in warehouse storage technology. Implementing cloud computing technology allows data to be uploaded to a cloud server and stored instead of locally. Implementing cloud computing allows data to be accessed throughout a warehouse system.
Inventory Management Drones
Improve inventory management by implementing another emerging trend in warehouse storage technology. Inventory management drones sync with a warehouse management system to collect and update warehouse inventory data. Employees can then access this for improved operations.
Autonomous Mobile Robots
Autonomous mobile robots (AMR) are another emerging trend in warehouse storage technology that reduces repetitive tasks and speeds up processes. AMR are small robots that can move independently through a warehouse to perform heavy and light-duty tasks, such as handling.
Sustainable Warehouse Storage
Another emerging trend is sustainable warehouse storage. More companies are seeking ways to cut their carbon footprint by becoming more sustainable. Warehouse storage can implement specific processes to reduce environmental impacts, including:
- Energy efficiency by utilising natural light and energy efficiency lighting
- Automated systems as automated equipment emits fewer emissions
- Sustainable climate control by reducing air conditioning and implementing insulating materials
- Compact storage systems by making more effective use of available space
- Recycle or reuse any material that can be or cut down on wastage that cannot
- Efficient layout that speeds up operations and reduces emissions
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