St. Onge Company Links Supply Chain Blog
Strengthening your supply chain one link at a time.
 

Be a Storage Media Influencer

Social media influencers have the power to set trends in fashion, style, music, diet, and language by promoting carefully curated imagery to their followers.  Storage media influencers do not exist – but maybe they should!

If walking into your warehouse feels like taking a trip back to another era, then it is time to reevaluate your storage equipment. By periodically reviewing the latest trends in storage media and making appropriate updates, you can maintain or improve your facility’s efficiency even as your business climate changes.

For example, during a past site visit I encountered a frustrated operations manager who was trying to figure out why shipping costs were increasing even though the number of orders and cases shipped held steady. After several audits, the manager found a dramatic increase in the number of exception picks that required additional shipments. He was certain this was a problem that could be easily fixed; after all, he had the latest slotting software, had seen plenty of poorly used locations, and had the product on hand in every case.

But the answer may not be as easy as re-slotting. Slotting works only when you have the correct mix of storage media.

Using the appropriate storage media allows you to improve your company’s bottom line by making the most of valuable facility space and improving productivity across nearly all of your facility’s operations, from put-away to replenishment/picking to shipping. It also enhances your ability to adjust to business changes, both expected and unexpected.

Observe the Signs

Do you see any of the following in your DC? If so, that’s your signal to begin a storage media mix review:

  • Significant amounts of wasted storage space in the facility, particularly in racking
  • Poor inventory visibility (long and inaccurate inventory counts)
  • High replenishment frequency and/or pick exceptions due to stock-outs in primary locations
  • Storage media in poor condition
  • Changing inventory or throughput volumes
  • Varying SKU mix because of facility consolidation or unprecedented growth
  • New products or packaging because of changes in customer taste

The first step in finding a solution is getting your hands on the right SKU-specific data, such as packaging specifications, inventory levels, and demand. This information is probably already available in your enterprise system and financial or sales files. For information that is hard to find, operational surveys, field checks, and educated assumptions are more reliable than you may initially think.

To properly determine the mix of storage media for your facility, you need to determine a finish line or time frame for data projections. Consider industry trends, customer service goals, and your company’s strategic plans and objectives. Don’t be afraid to use educated assumptions for unknowns, and cover your backside by being conservative in your projections.

Finding the most effective solution may seem daunting when you consider the wide range of storage options and possible combinations. So first, examine major groups of SKUs with common traits. Second, combine selections for SKU groups to build storage media mixes. Finally, conduct apples-to-apples comparisons of storage media combinations, including a status quo alternative. Quantitative (space, labor, costs) and qualitative (work environment, flexibility, customer service) factors will help identify the option that will best serve your needs. If you need to reconfigure, the results of your comparison will clearly indicate the benefits and provide an adequate return on investment.

Finalize your Plans

Of course, other steps and decisions are required to fully realize the benefits of installing the right storage media. The following strategies will enable you to derive maximum benefit from the equipment you select:

  • Ensure that the placement of product storage equipment in your facility supports an efficient material flow and use of space.
  • Determine what storage media to reuse; this is a key decision that directly affects your return on investment.
  • Consider the impact your storage choices will have on warehouse appearance and safety.
  • Prepare bid documents and evaluate vendor responses just as you would for more expensive material handling systems.
  • Complete a transition plan for operations.
  • Draw up a realistic post-implementation plan that lists your expectations, considering the learning curves associated with new equipment, layouts, and processes.

Realize the Benefits

What benefits can you expect from this exercise? At a minimum you should be able to:

  • Provide better service to your customers by improving order fill rates.
  • Reduce shipping costs by standardizing picking operations and decreasing the number of exception picks.
  • Add flexibility by saving space.
  • Improve your inventory accuracy by having locations that fit your product.
  • Heighten the morale of your warehouse employees.

Simply put, be a storage media influencer: Analyze the effectiveness of your storage media combinations and adjust proactively. This forward thinking move will provide noteworthy and tangible benefits that can be felt in virtually every area of your facility.
 
—Howard Turner, St. Onge Company
 
 

Enter your email to subscribe to "Links":