How to Manage and Run a Successful Warehouse Operation

What are the seven areas that managers need to pay attention to? We’re glad you asked! We’ve summarized them here for you. We’ve even added links to our more in-depth articles where appropriate.

Setting up and running a warehouse might seem simple at first. The truth is that it is simple—in that the concepts aren’t all that complicated. But what gets in the way of successful warehouse management is the sheer number of things to do. We’ve found, time and again, that warehouse managers run into problems because they only pay attention to (for example) five out of the seven things they need to do in order to manage and run a successful warehouse operation.

Start with the Right Warehouse Setup

When the flow of items through your warehouse is relatively small and slow, the configuration of your warehouse is not a big deal. But as you begin to move more items more quickly, inefficiencies in your setup will become more obvious. For example, you might notice:

• Areas that become bottlenecks
• Cross-traffic
• Pickers than get in each other’s way
• Items or orders that go missing
• Lack of quality control at key steps

These are all symptoms of poor warehouse setup. 

Setting up your warehouse correctly starts with a proper layout. Previously, we’ve discussed the ideal layout for small-, medium-, and large-sized warehouses. Though the details vary for each, the underlying principle is the same: Create a single flow of goods through the warehouse, with stations organized in such a way as to minimize the number of steps your workers take.

Once you have the layout in place, you’ll need to get the appropriate warehouse equipment, including storage equipment, material-handling equipment, packing and shipping equipment, and some sort of system for inventory control, preferably with barcode readers.

Make Warehouse Safety a Priority

Nothing grinds warehouse operations to a halt faster than a safety accident.

And believe it or not, the fatal injury rate for the warehousing industry is higher than the national average for all industries. Between the machines, the shelving, the heavy pallets, and the constant activity, there are plenty of opportunities for someone to get hurt if he or she is not paying attention.

We highly recommend downloading warehouse safety manual, OSHA’s Pocket Guide Worker Safety Series, for better understanding the safety in the warehouse.

A few of the hazards it covers include:

• Docks: Products can topple over or be dropped on a person, and it's not uncommon for a forklift to run off a dock, either.

• Forklifts: Roughly 100 people are killed and another 95,000 injured every year through forklift accidents.

• Conveyors: Workers can have a finger or their whole hand pinched or nipped.

• Material storage: Workers are often hurt when improperly stored items fall on them.

• Manual lifting: Back injuries often result from improper lifting and handling.
• Hazard communication: Workers can get injured when hazards (i.e., simple slippery floors, areas where chemicals are handled, etc.) are not properly signaled and communicated.

During your warehouse setup, make sure that warehouse safety precautions are built in before anyone even enters the warehouse. Then make warehouse safety checks and warehouse safety training a regular part of how you manage and run your warehouse operation.

Train Your Employees Well

Part of your safety efforts (see above) will involve appropriate training for your warehouse staff. But why stop there? You should also give your staff the training they need to be more efficient. For example:

• Do you have a particular way of packing orders for shipment that is more efficient? How do you teach employees this method?
• Do you use forklifts in your warehouse? How can you teach the most people to drive them, giving you maximum flexibility in worker assignments?
• Do your employees know how to do proper quality control (QC) after receiving items? When picking and packing orders? How do you teach them QC?
• Are your employees familiar with the system you use for rack labelling?

Remember, training is not just about imparting knowledge but also about giving your employees key skills they will need to work quickly and efficiently. Resources spent on training will pay for themselves over time in speed, efficiency, fewer mistakes, and a safer work environment.

Look for Small Ways to Automate

When you hear about automated warehouses, you likely picture a huge warehouse with robots and automated carts zipping around with hardly a human in sight.

The truth is that most warehouse automation is not this “wholesale automation” of the entire warehouse but rather the installation of special-use machines to do very specific and repetitive tasks.

This kind of automation rarely replaces humans…if anything, it frees them up to do tasks they are better suited toward!

Some examples of this kind of small-scale automation include:

• Automatic box builders
• Pallet wrappers
• Automated conveyor belts
• Computerized QC with digital cameras
• Laser measuring systems for calculating DIM weight

Manage Your Employees (Wisely)

Of course, you will have to hire the right number of workers and then create and manage their schedules. But then there is optimizing the output of those workers so that the actual work they do can reach peak productivity.

Optimal management can include:

• Anticipating seasonal ebbs and flows in order to adjust labor schedules
• Optimizing warehouse layout (see above) and pick paths
• Using the most efficient pick method

You should also have a system in place to monitor the completed work so you can look for further efficiencies. For example, could you answer the following questions about your warehouse operation?

• Do your shifts differ in the time it takes them to do the same tasks?
• Is there a difference in time spent on items that need to be placed in cold storage versus those that can be at room temperature?
• Are employees spending more time going back and forth to the warehouse shelves for individual orders than they are packing and shipping those orders?
• At each step of your workflow, how long do items sit idly waiting for someone to complete a step?

If you are able to gather the data and answer questions such as these, you’ll be able to manage your employees optimally, making adjustments when needed.

Manage Your Inventory (Wisely)

Managing an inventory for efficiency always involves trade-offs between pick velocity and available space. This creates a balancing act; problems occur if you have too much or too little inventory.

Here at Infoplus, we formulated this idea into three core rules for all warehouses:

• Rule #1: Have Enough to Service Demand.
• Rule #2: Don’t Overstock.
• Rule #3: Know Thy Inventory.

If you prefer a single comprehensive overview of these topics, check out our white paper, which also includes helpful hints for staying within these rules. A much shorter summary can be found in our post, “5 Steps to Fine-Tune Your Inventory.”

Always Look for Ways to Increase Efficiency

The above point about managing employees also generalizes: If you are keeping the right metrics, you should be able to spot bottlenecks and areas of inefficiency. Then target those spots to increase your overall efficiency.

Here are some ways that warehouses we have worked with increased their efficiency:

• Implementing a barcode system to help automate inventory counts and shipping
• Setting up a forward staging area
• Re-examining their lot mixing and fulfillment rules
• Integrating their shipping and inventory systems
• Changing their picking method
• Improving shelf signage and labels
• Making improvements to receiving

There are more, of course—so many that you might wonder where to start. Guess what? Those metrics should be able to tell you.

Get Ready to Manage and Run a Successful Warehouse Operation

Once you dive into these seven topics, managing a warehouse can start to seem like a daunting task. There are a lot of moving parts, and efficiency is the order of the day.

If that’s you, feel free to reach out to us. We offer on-site consulting and can help walk you through these and other issues, guaranteeing that your warehouse is as efficient as it can be.