Rina Redelinghuys, CQuential WMS Customer Services Executive reveals the challenges posed by the complex warehouse management environment and how they are met.
I have worked in this industry for many years. The one thing that I can attest to is the speed of change and the impact this has on warehouse managers who are mandated with continuously looking for ways to improve and become more competitive. There is an ongoing trade-off to drive service excellence while maintaining operational costs to deliver against customer expectations.
The following are the main objectives of the modern warehouse:
In a series of articles, I will share tips around how the warehouse manager can achieve operational goals in the shortest timeframe.
The following areas will be discussed:
Supply chain professionals constantly search to find ways to reduce the overall cost of getting products from source to consumption – warehousing is no different. It requires the warehouse manager to take a holistic view of the operation to drive cost reduction within the facility.
Having said that, it is also important not to favour short term measures over long term sustainability and growth. It’s recommended that warehouse management executives still need to invest in new technology and infrastructure if they are to remain relevant and competitive in the long term. This investment will ultimately drive down costs and improve efficiencies.
To achieve overall cost reduction, the following areas should be considered:
Inventory Visibility – Visibility of the operation and inventory is critical to drive down operational costs. The benefits of improved inventory visibility are the following:
The objective of any operation is to utilise the full cube of the warehouse. This will drive down the storage cost per item, which in turn reduces the overall landed cost to the customer.
There are several options that a warehouse manager can explore to improve the utilisation of the warehouse:
The storage setup needs to be reviewed continuously to ensure the business gets the best utilisation of the warehouse space over time.
It is also important to contract services from a warehouse specialist regarding designing a layout that aims to drive storage optimisation. The specialist will be able to validate the current storage setup versus industry standards and suggest a layout that will work for your specific operational needs.
Cross docking is the transfer of product from the supplier directly to the customer reducing the need to store and handle the stock during the fulfilment process.
This type of model is well suited to the following operations:
The Benefits of cross docking:
Cross docking removes the storage link which eliminates the storage component within the supply chain. This type of model works and if implemented correctly will have a significant impact on cost reduction across the supply chain.
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