With the cost of labor constantly increasing, warehouses are looking for areas to cut costs while increasing labor efficiency. First of all, it is important to take stock of your warehouse to see which processes can be improved and which ones are working at their maximum efficiency. While some solutions may be experimental and might not work in your particular warehouse setting, others are almost sure to produce better results if only for your warehouse atmosphere and the morale of your workers. Then it is time to go in to make changes where prudent. Here are five areas to look to make changes in your warehouse.
Incentive Pay. When properly executed, incentive pay can help bring about the best possible improvement in productivity and efficiency. Begin with your pick and pack labor, but be sure you properly analyze your productivity ahead of time so you are not paying extra for the labor you are already receiving.
Simplify Processes. Processes which were put in place and made sense years ago may not make sense on your warehouse floor now. Analyze your processes and be sure that there are the fewest and most sensible steps possible for moving products across your floor. The fewer the steps and touches a product receives, the less the handling of that product will cost you.
Effective Managers. The more a manager understands about their job and the aspects of fulfillment, the better the quality of the fulfillment in their area will be. If your manager is in need of training services, seek out that training for them to help them do better in their job and the needs of your specific warehouse.
Consider 3PF. Third-party fulfillment (3PF) can help you save costs on seasonal surges and facilities which would only need temporary use. Instead of expanding your warehouse only to be used for a short amount of time, a 3PF can be used during those surges to carry out orders specific to the surge.
Control Inbound and Outbound Freight. Carriers are one of the biggest areas for warehouses when it comes to saving money. In this area, it is best to use a consultant to help you lay out a plan and competitively bid. A good consultant will help you identify areas which can be negotiated in terms of reductions while still maintaining the service levels you seek from your carrier.