As a best practice, warehouse managers should conduct an ABC analysis, properly document and review the current process to detect inefficiencies, and improve warehouse processes before introducing any form of warehouse automation and/or warehouse technology. For effective optimization of the picking process, a warehouse manager must match the correct picking and warehouse automation strategy with the goods being handled (e.g. full pallets, full cases, individual units, cargos).
So, let’s dig into the steps needed to optimize one of thesix primary warehouse processes.
1. Conduct ABC Analysis/Order Profiling
The first recommended step is to collect data to understand how efficiently or inefficiently we are managing inventory. One of the best ways to do this is by conducting an ABC analysis and/or order profiling.
An ABC Analysis allows a warehouse manager to classify cargo into three categories (ABC) based on order volume. The idea here is to organize inventory such that the highest volume inventory (A) is stored toward the front of the warehouse, while the lowest volume inventory (C) is moved to the back. The result: less walking time and fewer man-hours required to complete picking operations.
The following image shows a warehouse where high volume inventory (RED) was spread across the warehouse, resulting in unnecessary walking time. After the analysis was conducted, high-volume items (RED) were moved to the front and low-volume items (GREEN) to the back.
For warehouses and distribution centers that do not process customer orders, an ABC analysis can be done based on receiving and shipping volumes.
