Warehousing products can create several obstacles that businesses must overcome. Organizations face issues with the supply chain, as well as the effects of their own internal processes for inventory management, space optimization, order fulfillment and cost control. Finding the right system may require significant investigation and adjustment, especially for a growing company. With this information, purchasing professionals will understand the most common challenges in product warehousing, as well as the best practices to manage them.
Supply Chain Complexities
The complexities of the supply chain can increase the strain on even a robust product warehousing system. An increasingly global marketplace draws materials and components from distant regions, adding time, cost and other hurdles that purchasing professionals must navigate. A sudden change in demand, or a shortage in the ability to manufacture a crucial component, can leave companies relying on their existing stock as much as possible. A resilient supply chain can anticipate and manage these concerns, but businesses need to utilize technology and modern inventory management systems to forecast and plan for supply chain disruption.
Inventory Management
An inventory management strategy must be efficient, consistent and accurate to provide useful information. Many companies rely on inventory management systems that are outdated or manual, requiring hours of human labor to do what a machine could perform in minutes. Older systems increase the chance of inventory loss or inaccurate counts.
Updating inventory management can help purchasing professionals to improve accuracy and efficiency. Modern systems rely on AI, barcodes and electronic databases to automatically categorize and present data. AI can identify trends and help companies avoid ordering too much of any product. Purchasers can also see what they have at a glance, with faster methods to verify and order more supplies.
Space Optimization
Maintaining an accurate and useful inventory of products calls for an optimized storage space, which many companies do not have. Some businesses choose to organize inventory based on a process that leads to excess time searching for the right product or component and walking to the next station.
Optimizing space involves a thorough evaluation of the production and packaging process. An efficient picking system minimizes the distance between identifying the order and finishing packaging for shipment. In many cases, companies can minimize waste by placing the most in-demand products closest to fulfillment, leaving low-demand products for the depths of the warehouse.
Order Fulfillment
Speedy order fulfillment requires an updated inventory management system and an efficient layout for the warehouse. Inaccuracies in inventory can lead to sales that cannot be completed or the languishing of forgotten products in the warehouse. An inefficient layout takes longer for the picking crew to locate the product, leading to delays in shipping.
The use of automation can simplify many of these processes. Electronic order management allows workers to easily review the information, approve shipping and set timelines for order fulfillment. Tools like robotic packaging systems can free up workers to focus on tasks that cannot easily be managed by technology.
Cost Control
Many of the errors that companies make in warehouse management come from a desire to cut costs. Cost control is an important factor in product warehousing, but businesses must evaluate their goals and confirm that they do not create more problems than they solve. For example, lean inventory management can minimize space used for storage and simplify the order fulfillment process, which can cut costs on warehouse space and increase revenue. With an inefficient system, however, companies may end up with insufficient supply that causes them to lose sales. Creating a practical setup with automated inventory management, ordering and fulfillment can eliminate wasted money.
Product warehousing can provide excellent opportunities to improve efficiency and decrease waste if companies are willing to work to implement a customized plan. By utilizing technology and other efficient tools, businesses can find a path toward a warehousing strategy that saves time, money and labor.
