Top 6 Symptoms of Bad Warehouse Slotting

Though slotting occupies a very fine-grained level of detail, a good slotting plan is an essential part of a successful warehouse layout. In fact, efficient slotting has been shown to reduce labor costs up to 20%. But how do you know if your current slotting is up to the task?

Warehouse management software can boost efficiency in a number of ways. Managers count on its ability to provide real-time data, track productivity, and plan out daily fulfillment goals. One function that sometimes is overlooked, however, is slotting. Very simply put, warehouse slotting means putting things where they belong. And therein lies the problem—it can be easy to underestimate and dismiss the importance of such a basic concept.

But make no mistake, a good slotting plan is an essential part of the warehouse layout. In fact, it’s estimated that labor costs can be reduced by as much as 20% when efficient slotting is implemented. The alternative is a loss of productivity. And since time is money, bad warehouse slotting will eventually be felt in the bottom line.

How Does Slotting Software Work?

Warehouse management software that includes slotting algorithms can generate a plan for appropriate placement of each piece of inventory in a warehouse or distribution center. To do this, the software incorporates a number of data points about each item, as well as the physical warehouse space where they all must fit.

Physical aspects of each product are examined, such as:

• Dimensions and weight
• Storage medium (is it kept on a rack, shelf, or in a carton?)
• Picking level (is it picked by pallet, case, or individual unit?)
• Special storage requirements (for example temperature-controlled or locked for safety)

Sales and fulfillment details should be included in the calculations too:

• Sales velocity (both past data and future projections)
• Seasonal velocity fluctuations
• Product grouping (sales data will show which items are typically bought together)

A very small company whose products take up only two or three shelves may not worry much about slotting, but deciding where hundreds or thousands of things should go becomes much more important—and complex. WMS software uses all of these data points to automate decisions about where each item should be slotted. Choosing the right locations will make picking faster and easier, allowing the warehouse to continually reach its fulfillment goals.

Signs That Warehouse Slotting is Flawed

Running a warehouse without a clear plan for slotting is like buying groceries and not putting them away where they belong. Maybe things are shoved into cupboards wherever they will fit. Or perhaps, the grocery bags are simply dumped on the countertops and nothing is put away at all. Either way, the result is a disorganized kitchen. A cook will have a hard time finding what they need or the room to work preparing a dish.

Problems in warehouse operations can often be traced to bad slotting decisions. Here are some of the most common symptoms, and how slotting can play a part in the solution.

1. The Place (Seems to Be) Running Out of Space

A manager may think a warehouse is bursting at the seams and that the solution is expanding to additional square footage. In reality, the space may just be crowded and cluttered with things that are slotted incorrectly (or not at all). For example, if there is no designated space for a new product, pallets that come in may be dropped off and left in the receiving area. Or, shelves appear to be filled, but on closer inspection have a lot of unused space.

Slotting Solution: Organization is the key, and everything needs a proper place during its time in the warehouse. Slotting software acts a bit like a jigsaw puzzle. Using dimension and level information it can find the best way to arrange all the pieces of inventory to make the most efficient use of available space. Every new product should be added to the WMS so the algorithms can run a new map of how things can be rearranged to accommodate it.

2. Picking Times Are Slow

When pickers take too long to fulfill orders, there is a tendency to assume it is an employee problem. In fact, workers may be doing the best they can under the circumstances. When things in a warehouse aren’t slotted properly, it is hard to pick orders quickly and easily. Disorganized storage can cause pickers to travel greater distances to pick every item for an order. They may also spend time opening cartons, disposing of the packing materials, and replenishing forward picking bins while they’re trying to pick. 

Slotting Solution: Automated slotting works in concert with WMS-generated pick paths and appropriate rack labeling to give pickers the most efficient way to do their jobs. Products with high velocity can be given prime locations where workers can quickly grab them off the shelves. Or, they can be sent to a forward picking area that is replenished often. 

The kind of pick should be taken into consideration as well: For example, products won’t be stored in crates on the shelves if pickers need to pick individual units. Likewise, the software can take product affinity into account as well. Take any two items that are often sold together-- like a particular brand of razor and the refill razor blades that match, or a t-shirt and a hat promoting the same event. These items can be stored close to one another so that travel time is minimized for orders that contain both.

3. There Are Errors in Order Fulfillment

Having to hunt around for something that isn’t where it should be will slow pickers down. An alternative scenario is that they keep their pace, but often pull the wrong product or quantity from the shelf. The chances of picking the wrong products off the shelves increases when they are slotted incorrectly...and shipping the wrong items makes for unhappy customers and more returns. With tight quality control procedures, errors might be corrected before the package leaves the building, but that just makes more work for everyone.

Slotting Solution: With good slotting procedures in place, pickers will find what they need in the right location—every time. There will be no question that the next destination on their pick path will have the item that they’re looking for. Proper slotting starts in the receiving area. As crates and boxes are unpacked, workers will know exactly where they belong in the storage area.

4. Workers on the Floor Experience Traffic Jams and Bottlenecks

Productivity in a warehouse suffers when people and machines get in each other’s way. The point of well-drawn pick paths is to eliminate backtracking and bottlenecks. Improper slotting can cause them, too. Let’s say one aisle of a warehouse holds pallets that must be moved with a forklift, but also smaller items that a picker can grab by hand and place on a cart. Whenever the forklift needs to travel down that aisle, there is no room for a cart (and there are potential safety issues as well). Likewise, forklifts will need to wait until the human traffic clears. An efficient slotting scheme can minimize this kind of cross-traffic.

Slotting Solution: By slotting items according to level and storage medium (bin, cart, full pallet, etc.), aisles can be designated as exclusively for forklifts or carts. This way neither type of picker needs to wait in line for access. If both types of inventory absolutely must be slotted together in the same aisle, their location on the shelves should be maximized for efficient picking to limit the duration in which a bottleneck occurs. Scheduling specific times for one or the other to pick is another alternative.

5. Damaged or Spoiled Inventory

Disorganized storage increases the likelihood that products will be ruined. Just as it would be a mistake to store canned goods on top of a loaf of bread, slotting things incorrectly in a warehouse may damage them. Attention needs to be paid to FIFO (first in, first out) rules too. Perishable items will spoil if they’re pushed to the back of shelves by newer inventory.

Slotting Solution: Taking inventory characteristics into account, slotting decisions can help to protect things that are easily damaged. Weight, picking level, storage medium, and special requirements, along with the appropriate machinery for handling all come into play. If something breakable, like light bulbs, is picked by piece rather than case, they might be safer within arm's reach rather than perched on the top shelf. Likewise, something heavy like a car motor would be placed close to the floor to avoid being dropped by the heavy machinery used to lift it off a higher shelf. The organization of climate-controlled storage areas is essential so that nothing is damaged to being left somewhere too hot or too cold.

6. “Missing” Inventory

When products aren’t in the right place, it’s easy for things to go missing. The items are there—somewhere—they just aren’t easily seen or located in the jumbled mess. This will prevent warehouse workers from fulfilling orders for the “lost” item. It can also cost the company money as the purchasing department might place another order to replace it. Using our kitchen analogy, most people can relate to buying a can or jar of something, while a long-forgotten older version collects dust in the back of the pantry.

And, as much as you want to trust your employees, the fact remains: Loose inventory in a disorganized warehouse might tempt some people into theft. Tighter control of the inventory puts this temptation out of their minds.

Slotting solution: WMS with a slotting application, along with good rack labeling and real-time inventory data, can ensure that managers know exactly what is in the warehouse at any given time.

Invest in Warehouse Slotting that Works

Warehouse slotting is like a giant jigsaw puzzle. All of the pieces need to fit together to produce the desired result. Where things are placed in the warehouse is as important as the paths pickers will take or the equipment chosen to move products around. 

An organized warehouse is an efficient warehouse. When the space at hand is used properly, orders will be fulfilled quicker and more accurately, with fewer missteps. Choosing a robust WMS that includes slotting algorithms will make that happen.