Although in recent years there have been enormous technological advances that facilitate procedures, many manufacturers and distributors still do not carry out proper inventory and warehouse management.
This is mainly due to the lack of processes adapted to the needs of each business, as well as the stock storage system and the correct handling of information and documentation.
In this article, I tell you how to carry out efficient warehouse management, based on specialized tips and tools, so that you can increase the profitability of your business.
Inventory and warehouse management
The warehouse management is a key process performance in any business or distribution center, which is to receive, organize, store and move the elements that constitute it.
This activity is also part of the process of the logistics function of having the right amount of merchandise in stock or what is known as inventory management, which is an important factor for the success of organizations.
Today, companies do not hesitate to equip their staff with a Warehouse Management System (WMS) that simplifies the control of these procedures in an automated way.
What is the goal of warehouse management?
The objective of warehouse management is to offer an optimal service, without increasing the cost of storage, thanks to:
- The correct arrangement of materials,
- the control stock,
- the management of supplies,
- the implementation of a process flow and the centralization of tasks that ensure uninterrupted service.
Most supply and out-of-stock problems derive from insufficient control measures or the lack of adequate processes to report in real time on movements in the warehouse and the frequency of sales.
3 Processes for managing a warehouse
Let’s see in detail the processes that warehouse management contemplates within the production chain.
- Reception and disposal
The reception is the process that begins once has consolidated the relationship with the supplier and expect the arrival and entry of merchandise to your store. This contemplates a series of processes such as:
- The unloading of the merchandise,
- verification of the status of the merchandise,
- the disposition of the merchandise in the warehouse.
- the coding method according to the type of merchandise (perishable or not, for example).
This is where you foresee the logistics that you are going to require during the merchandise dispatch process, mainly what has to do with the departure and transport:
- The implementation of an EMS for the preparation of the order,
- the definition of the route in the warehouse,
- the extraction of the merchandise,
- transportation to the dispatch area.
This is the final stage where the merchandise finally leaves your warehouse to be taken to the different distribution points. Contemplate activities such as:
- Consolidation of units and packaging,
- the location of the merchandise on the vehicles,
- the issuance of the necessary documentation for monitoring and control.
How to run a warehouse in 8 practical steps
- Conceive the space correctly
A key parameter for a well-conceived and structured warehouse is having clear, easy-to-read floor plans, located in easily accessible and well-marked areas.
The labels should also be easy to read and large enough. The color of the letters and the presence of a barcode are important elements.
- Keep the warehouse well organized
Make sure your warehouse is organized in a systematic and strategic way. This makes it easy to identify items, both for order picking, receiving and storage.
Also, identify out-of-stock areas, such as empty shelves, so they can be useful later.
- Establish a labelling procedure
- In the warehouse: each item must be clearly identified and contain information that fully describes it with all its details (expiration date, presence of hazardous materials, packaging requirements, type of product, etc.).
- Regarding merchandise management: the supplier that transmits the product to the warehouse must follow good inventory practices.
- It has a system of denomination of stocks
The naming convention used to identify an item on labels is equally important.
The unique identification of items is the most important here. However, in addition to being unique, you also have to consider its length and clarity. Item names should be short and clear, generally using numbers and letters to identify each product/material individually.
Among the things to consider when introducing a naming convention are:
- Group the articles hierarchically (product family, model, etc.).
- Avoid special characters or symbols (such as trademarks).
- Use clear and descriptive names.
- Define a storage and reception policy
For efficient inventory operation and accurate data recording, it is important to define all processes and procedures in place in the warehouse. How to do this? Through a policy that:
- Include procedures for physical interaction, material handling, security procedures, and quality reporting.
- Specify in the documented procedures how the assets are to be managed, verified and stored.
- Indicate how damaged inventory should be managed (can it be recovered or should it be disposed of?).
- Designate people involved in warehousing operations to review the documentation before it is released to the team.
- Consider formal worker training.
- Allow to check that procedures are being followed to the letter. If not, apply corrective measures in this regard.
- Use cycle counting or cyclical counting
Although most companies have processes in place to better manage inventory, this does not eliminate the need (and benefit) of using cycle counting.
This inventory counting method differs from the traditional method, in which operations are suspended while all the materials in the warehouse are counted at once.
Cycle counting has a less disruptive effect on daily operations and provides a continuous assessment of inventory accuracy and the root causes of detected errors.
Tools like Be One Solutions, allow you to classify inventory based on transaction volume and / or value. Additionally, regular, periodic counts of available item quantities can be entered to maintain inventory accuracy.
- Control access to stocks
A simple security measure for good inventory management is to operate using a permit generation system. Such a system should ensure that only responsible employees have access to stocks and their information.
Nowadays, you do not need to make greater efforts in the standardization of this process, since there are applications such as Kizeo Forms, which can help you in the digitization and optimization of inventories . This solution simplifies the creation of checklists, so that employees fill out a form from the mobile application and the supervisor receives a copy of the report.
Knowing exactly who has access makes it much easier to manage the system, reduce errors and implement changes when necessary.
Ideally, this should be decided earlier, when the inventory management system is established. Controlling who has access to the inventory and the management system remains a constant asset, so establishing an annual or semi-annual control would be very useful to keep the list of people with access to the inventory updated.
- Automate your management
Keeping track of your inventory with pencil and paper or with simple spreadsheets is probably not what will ensure the optimal management of your warehouse.
Choosing an EMS for your warehouse depends on the needs of your company. In addition to Kizeo Forms and a warehouse management system, there are many other tools that help you automate and improve your warehouse management.
Importance of optimized inventory management
Some organizations do not measure their inventories accurately or do not have a Warehouse Management Software (WMS) to help them coordinate and obtain real measurements of their processes.
However, every organization should know the many advantages of having an appropriate warehouse management such as:
- Offer excellent customer service.
- Meet delivery deadlines.
- Reduce operating expenses.
- Provide accurate data for financial records.
- Optimize handling and transport processes.
- Anticipate future purchases.
Warehouse Management Systems (WMS)
Having an optimized warehouse management can translate into significant time savings and a huge reduction in costs. For this, it is interesting to implement a Warehouse Management System (WMS) .
The data that this type of system will generate is optimal and of high value for the company.
Warehouse Management Software Features
The usefulness of implementing an EMS then becomes a process optimization measure that intervenes at different levels:
- Receipt and labelling of products,
- handling of delivery notes,
- Product location,
- inventory management (avoid breakages or excess stock).
- Organization and consolidation of orders,
- definition of tasks by operator,
- packaging management.
- Product outbound logistics,
- control of handling operations according to the type of product,
- coordination of transport,
- preparation of the necessary documentation,
- route design and optimization,
- stock update.
- customer satisfaction.
Do not wait any longer to ensure the proper functioning of your warehouse and increased sales. When it comes to improving your management, don’t hesitate to rely on these tips and tools.