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Finding Hidden Warehouse Savings

Warehouse managers are busy dealing with supply chain issues, finding and keeping quality labor, and firefighting.  This daily grind makes it difficult to have the time required to find hidden warehouse productivity improvements.  The hope is you can find a few minutes to read this blog, so you can be prepared to find hidden savings during your next walk-through the operation.


Do you see a lot of walking in the pick area?  There may be opportunities to modify the pick path.  The material flow and pick sequence in your facility should result in minimal travel.  The order picking area has the most labor and walk-time can be 40%+ of the total time picking.  You must first understand the pick sequence and make sure it is not resulting in back-tracking, or passing the same location more than once.  If picking to a pallet, there may be other constraints to your pick path (i.e. building a stable load, product weight, etc…).  Within your existing system, you should be able to define the pick-path to reduce the travel time and increase picker productivity.  Much of this enhancement requires the improved slotting of items within the pick area.

Do you see lift truck drivers traveling long distances before performing a task?  The storage area is usually the largest area of the warehouse.  While lift trucks are used for traveling in a warehouse it is still important to reduce the travel distances.  Look into zoning the warehouse by item velocity.  Storing the fastest items closest to the dock and slowest items in the back of the warehouse (and in the top storage levels), drastically reduces travel distances and retrieval and put away times.  In addition, if your legacy systems can enable directed activities, then the operator can reduce search time during stocking and retrieving pallets.

Also, in larger storage areas, the use of bridge bays or tunnels and cross aisles reduces the travel time and minimizes backtracking.  You may be able to remove beams and uprights as needed to create these efficient travel paths in the warehouse.


Do you have documented standard operating procedures and/or process flow diagrams?  By reviewing your documented processes, you might identify inefficient steps, delays, and repetitive tasks.  The next time you walk the floor, observe that the processes are being followed, or if there are additional tasks required that are not documented.

Do you see a lot of empty pick locations?  One of the biggest process improvements could be within replenishment.  If you are relying purely on a demand-based replenishment strategy this can lead to congestion and increase pick location stockouts.  An improved process might be to replenish the forward pick locations using a min/max strategy.  This means, when a location hits the minimum inventory location amount, a replenishment task is triggered by the warehouse management system.  This reduces the probability of a location stock-out during picking.

Do you see an order picker with one order traveling through the warehouse?  Another process change to consider is batch-picking multiple orders, versus walking the pick-path for only one order.  Lower volume operations can simply provide multiple pick tickets to the process and increase productivity by 30%-50%.  Larger operations may need a system change to enable the batch picking process.


Do you see a lot of walking, congestion, bending or stretching to reach locations in the pick area? Slotting is often the biggest opportunity for reducing labor costs.  Slotting refers to right-sizing forward pick media and positioning items to maximize the use of space and labor resources.  Properly sizing the pick locations impacts the amount of replenishment and travel distance during picking.  You can achieve improved slotting with the purchase of stand-alone slotting software, or by building an in-house tool for smaller operations.  However, on-going and frequent slotting likely requires the development or purchase of an advanced slotting program.

The fastest moving items should be located in the golden zone (between waist and shoulders) to reduce bending/stretching.  Typically, 80% of the pick activity is generated by only 20% of the active products.  These top-moving products should be located in the most ergonomic and properly sized locations to minimize replenishment labor.  These products should be balanced across the pick zones to reduce congestion and further increase picker productivity.


Do you see operators scratching their heads, and/or constantly huddled with team leads/supervisors?  A clear understanding of the tasks to perform is critical to achieving higher productivity.  It is essential for facilities with high amounts of temporary staffing.  If operators don’t have a clear understanding of the process it will lead to time-consuming mistakes.  A training program should include the following:

  • Simplify processes
  • Reduce manual processes
  • Mix-up training using class-room, on the floor, see what works each person
  • Effective training materials / videos (standard operating procedures)
  • Ensure operators know impact before and after their process/area
  • Ensure operators know the products
  • Consider team incentive program / mentor programs
  • Continuously train


Do you see people lost, having a hard time finding their way, or look generally uncomfortable?

Possibly the most hidden areas of improvement that impact productivity is general facility management.  This includes signage, rack labeling, conditioning space and lighting.

Proper aisle signage can be a major time saver, especially for new or temporary employees.  Having large, easily readable signs, and an easily understood location scheme make a big difference.  Even with no bar coding or scanning, a quality location label ensures the operator can quickly find the right location.

With the majority of warehouse facilities unconditioned, it can be an afterthought to take steps for a comfortable work environment.   Adding aisle and overhead fans, opening dock doors and wall vents can lead to large productivity gains.  A more comfortable employee is a more productive one.

Lighting is an obvious need for efficient operations, and the use of LED is in big demand for the economic benefits, longevity and quality lighting.  However, older facilities have halogen lighting and other conditions resulting in poor lighting.  There are no great low investment options to retrofit an existing poor lit facility, but building this into your future capital plan might yield good economics.

Hopefully the few minutes you took to read this blog will allow your next visit through the warehouse to result in finding these and other hidden savings lurking within your facility.
—Norm Saenz, St. Onge Company

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