There is always room for improvement in the logistic processes of every organization, but there is a special place where they need to run smoothly and flawlessly: in warehouses. This is a nodal point in the journey of a product from the manufacturing plant to the end consumer. If it is properly organized and operated, with a clear view of existing stocks at all moments, then the supply chain will work flawlessly, without surpluses or interruptions in providing products to stores.
However, the reason why the worldwide supply of products and logistic processes are still inefficient – at least compared with the possibilities offered by modern technologies – is the lack of proper automation and implementation of lean manufacturing principles in warehouses. These huge repositories of various products are still suffering from the lack of order, of adequate procedures for receiving and shipping goods and from interruptions in the communication chain between the warehouse workers and the central office employees.
Professional logistics specialists have identified during their extensive first hand experience a series of errors which are visible at worldwide level. In this article we have decided to present the top 5 logistic processes errors which make warehouses operate inefficiently and in a costly manner:
1. Manual Labor Is Still Used In Great Proportion
Although logistic equipment and machines are affordable and sufficiently diversified to cover most of the logistic processes and operations taking place in a warehouse, manual labor is still used on a large scale. There are cases when the workers have to push or pull heavy boxes using only their own strength – without the help of the simple dolly for EURO sized containers.
Manual labor is slow and fraught with the risk of accidents resulting in injury and loss of products. Warehouses where employees are primarily used to handle products manually accumulate many costs, are unable to keep up with the constant demand for deliveries and end up becoming both unprofitable and unproductive.
2. Stock Inventories Are Kept On Paper
The next worst offense after manual labor is keeping track of products entries and exists on paper lists which are later input in central computers. A simple audit would show discrepancies between records and actual stocks at any given moment. The reason for this is that any time lapse between the physical entry or exit of products and its recording in the computerized inventory software leaves the logistics and supply manager unsure of how many products they actually have on stock.
Inventory keeping is one of the most critical logistic processes in warehouses. They need to be fully integrated with the central computer network and the employees have to be supplied with handheld devices (such as smartphones, tablets or notebooks) allowing them to record each stock move directly into the central inventory system.
3. New Stocks Are Placed Wherever There Is an Available Spot
This type of approach is a guaranteed road trip to massive losses: products are “lost” among other types of products, forgotten past their shelf life because there is no precise order for receiving and delivering them onwards. The FIFO system was developed exactly in order to avoid the occurrence of such situations, and making sure that all products are shipped in such a manner that none is left behind beyond its expiry date.
Implementing a system of modular shelves for pallet containers with label holders for the quick identification of the contents and receiving date in the warehouse is the smart and cost efficient manner to keep your warehouse productive.
4. Packaging Materials Take Up Too Much Place
Every inch in a warehouse matters and is extremely valuable. If you are using storage space for empty containers, while the newly delivered filled containers are waiting to be placed on shelves, you are losing time, space and money. Selecting adequate packaging materials is a strategic decision with a strong impact on the logistic processes of warehouses.
There is a large array of foldable and collapsible containers on the market, adequate for all sorts of merchandize, which can be easily handled with forklifts, automated discharge systems for containers and which can be easily stored when they are not in use without taking up too much space.
5. Failure to Promote Actual Communication and Teamwork
Beyond all technicalities, if the people working in a warehouse are not constantly on the same page with each other, aware of each other’s work, of the latest news from the central office and the list of demands from suppliers and clients, the warehouse will not be able to be a trusted supplier for stores.
There is no replacement for your employees’ innovative ideas and last minute creative solutions to solve any problem choking up your supply chain. People must always remain at the core of any smooth and efficient logistic processes, but in order to do so, they must be always encouraged to work together in a friendly environment of openly shared ideas.