There’s no denying that inefficient warehouse operations can lead to higher operational costs and significant delays in order fulfillment for customers. And when working in the competitive world of ecommerce, where speed and accuracy are king, there’s no secret that warehouse efficiency can make or break a business. Johannes Panzer gives his top tips on significantly enhancing the efficiency of a business’s warehouse operations.

1. 1. Building Strong Foundations with Inventory Management

Effective inventory management, consisting of accurate tracking, efficient receiving of goods, a thorough ‘put away’ process, and regular stock-taking. These form the backbone of many successful ecommerce businesses. This success all starts with a well-structured ‘goods-in’ process. This needs to be complemented with, implementing effective barcode scanning to verify goods against purchase orders – this is essential for maintaining accurate inventory records from the outset. This accuracy is essential because it prevents issues further down the line – especially in picking, packing and dispatch. After the verification of goods, they then need to be moved to their designated storage locations. Again, barcode scanning forms part of this process, helping to locate goods and direct where they should be placed, stored and collected from when needed, as part of a wider traceability system,  ensuring items are easily locatable when required.

Getting stock-taking right is also essential when building the foundation of a good ecommerce operation. In fact, it’s non-negotiable to maintain financial accuracy and prevent overselling. For example, if adopting a cycle-counting approach, teams should be checking a few locations every day, or spending a few hours a week when picking demands are lower. Ideally, no location should go unchecked for more than 60-90 days. By scanning each item and its location respectively, businesses can ensure their inventory data matches the physical stock available. By doing this, businesses mitigate the risk of selling products that are out of stock, which can lead to customer dissatisfaction and financial losses.

2. Enhancing Order Fulfilment for Speed and Accuracy

Fast and accurate order fulfilment is the bread and butter of any good warehouse operation. However, for this to run smoothly there must be an efficient picking and sorting process in place. Yet, not all operations have the right tools available to hit their goals.

When it comes to effective equipment for product sellers that typically deal with small items, like clothes in polybags, socks, batteries, beauty or supplements products or similar items, a pick and sort to trolley system will significantly enhance any business’s picking efficiency. This system is essentially a trolley with designated slots or totes, each representing a separate order. As pickers move through the warehouse, they can collect items for multiple orders simultaneously and sort them into the corresponding totes on the trolley. By using this trolley system, workers can minimise their travel time and streamline the packing process.

Another tip is to ensure you optimise your picking routes by sequencing them. Sequencing is another key factor in efficient order fulfilment. It involves strategically planning the picking route to minimise travel distance, whilst also ensuring efficient trolley weight distribution. This might involve arranging picking locations alphabetically or in a way that corresponds to product popularity, minimising the time and effort required to complete each pick.

3. Optimising Packing and Shipping for a Seamless Workflow

The final stage of the fulfilment process is the packing and shipping stage. In this stage of the process, businesses should make it a non-negotiable to have a well-equipped pack bench. Preferably one with a raised monitor for better visibility and space utilisation, a hard-wired scanner for reliable connectivity, and readily available packing materials such as boxes, packing peanuts, and pre-printed packaging barcodes. These elements are important to ensure packers have everything they need within reach, minimising the chance of errors.

As well as this, businesses should also implement a scan-to-ship system. These systems are crucial for verifying order accuracy before packing any order. The beauty of this double-checking system is that it reduces the risk of shipping errors, ultimately improving customer satisfaction and minimising costly returns.

4. 4. Managing Returns Efficiently to Reduce Costs and Delays

‘Returns’ is the dirtiest word in retail right now… And, unfortunately, it’s here to stay! Especially in the fashion sector, returns are an inherent part of ecommerce these days. And how businesses choose to deal with them is massively important.

In order to see the returns process go as smoothly as possible, businesses should integrate it into their warehouse operations for greater visibility and automation. This allows for the real-time tracking of incoming returns. With this enhanced visibility, warehouse staff can anticipate the volume and types of returns they are faced with and, therefore, plan around this information and allocate resources appropriately. Finally, automating the refund process for eligible returns can also make a big difference. Not only will it speed up the process, but it will also improve customer satisfaction and free up customer service resources – a win-win for everyone!

5. Designing a Warehouse Layout for Maximum Productivity

The look and feel of a warehouse’s layout goes a long way towards the efficiency of its operations. So, to optimise the space available, the floorplan should be kept clear to allow easy access to goods. In an attempt to streamline the workflow, it is wise to have designated areas, such as goods in, goods out, picking, packing, and returns. By separating these activities, a business will reduce congestion and minimise the risk of errors or delays.

Most ecommerce businesses – particularly those that normally deal with smaller items like clothes or toys – will benefit from installing large pick faces with single-SKU locations. The reason for this is that, unlike traditional large-scale racking systems, these pick faces allow for fast, efficient order fulfilment. Finally, businesses should also look to use whatever room they have available. For example, support beams can be effectively used for additional storage solutions such as shelving units, maximising the usable space.

6. Using Data and Technology to Drive Continuous Improvement

Few things are more important than good data analysis when it comes to optimising a warehouse’s operations. The reason for this is that data dashboards can aid businesses in monitoring performance in real-time. This is done through a comprehensive overview of key performance indicators.

But what should businesses be looking at? The key metrics to focus on, or that can be most beneficial to a business, are the number of items picked per person per hour’, the ‘number of orders that can be fulfilled in backlog’, the ‘Mean time to ship’, or % of orders that go out within 24 hours, and return rates,. These individual operations can all be visualised and tracked, helping managers to identify bottlenecks, track employee performance, and make informed decisions to optimise processes.

To conclude…

By carrying out the above strategies and technologies, ecommerce businesses can significantly enhance the efficiency of their warehouse operations. From inventory management to order fulfilment and returns processing, every stage of the warehouse workflow can be optimised to reduce costs, improve accuracy, and, ultimately, enhance customer satisfaction while making sure to keep the delivery promise given and made at check out.