Warehouses are facing more changes than ever as global supply chain issues since the COVID-19 pandemic. To stay successful and sustainable during these times, it’s important to have flexible and scalable processes that follow industry best practices.
Warehouse managers need to keep an eye on changes in the business environment and be ready to adopt new solutions. This task is easier when they have a) the right information and b) helpful tools.
Apart from unpredictable demand, and varying labour needs and costs, there are several more challenges. These need strong systems to help managers keep up with changes and identify areas that need improvement.
In this blog we have discussed all about problems in warehouse management and how to solve them, let’s jump right into it!
7 Problems in Warehouse Management and Solutions:
1.Inventory Inaccuracy
First, among the problems in warehouse management, we’ll talk about maintaining accuracy and efficiency in inventory management is crucial, especially in a world where events can drastically affect demand, like customers buying up all the toilet paper in Australia overnight or South Africa shutting down the alcohol industry.
Inaccurate inventory leads to issues such as incorrect stock levels and the accumulation of obsolete inventory, which can cause picking errors when workers rely on faulty data, leading to inefficient processes. These inaccuracies can also lower productivity, increase costs, and result in lost revenue.
Solution: Implementing automated systems provides real-time, accurate information about stock levels and composition. The success of inventory management technology hinges on the quality of the system itself.
2.Redundant Processes
Traditionally, warehouse employees may handle a product multiple times due to standard warehousing practices. However, since the onset of Covid, this redundancy has become a health risk and needs to be reassessed.
And that is a huge problem in warehouse management, for instance, passing the same ticket through multiple hands is now a significant concern.
Solution: While some redundant processes are necessary, they are often time-consuming and increase labor costs, as well as pose health and safety risks. Using barcode technology can streamline warehouse processes, eliminate redundancies, and maximize resource utilization.
With rapidly evolving automation technologies, warehouse managers need to keep systems up-to-date to ensure they thrive, not just survive.
3.Poor Warehouse Layout
Efficient use of space is a key success factor in warehousing, especially in 2021, where there’s a push to do more with less. Inadequate storage space and inefficient use of available areas are common issues in poorly laid-out warehouses. A suboptimal warehouse design can directly impact profits.
Solution: An optimal warehouse layout considers both the floor and vertical space available. Besides maximizing space usage, a good layout optimizes equipment and labor use, ensures easy access to all items, secures inventory, and maintains staff safety.
Using forklifts can help configure a layout that utilizes both horizontal and vertical space effectively. Complementary strategies to solve this problem in warehouse management systems include making high-demand inventory easily accessible and streamlining dock-to-stock processes.
4.Erratic Demands
Fluctuating demand is a significant challenge for warehouse managers. The global financial crisis caused a dip in sales for many, leading to overstocking in some areas, while PPE suppliers found themselves overwhelmed by sudden demand spikes.
This issue highlights the difficulty of managing demand fluctuations due to external factors beyond the warehouse’s control.
Solution: Managing seasonal demand fluctuations requires timely and accurate information about manufacturing, retailing, and the industry. Information gaps between the warehouse and relevant entities limit the ability to monitor and respond to demand changes effectively.
Planning and forecasting demand, as well as providing supply chain visibility, are crucial to solve problems in warehouse management.
Rearranging products to match current demand helps minimize the negative impacts of seasonal changes. This involves positioning high-demand items at the front of the picking aisle and at the correct height.
Managing erratic demand also involves optimizing transportation networks and strategically sourcing transportation services, building long-term capabilities with strategic value.
5.Labor Costs
Warehouse managers aim to boost productivity while minimizing labor costs, which can account for around 65% of operating budgets. Warehouses typically use expensive equipment and employ large labour forces, including cleaners, packers, managers, and administrative staff.
Solution: Reducing labor costs should consider the impact on other expenses. Two main strategies to address labor-related issues include maximizing the existing labor force and automating systems. Workforce planning can help managers develop the necessary skills for effective labor management.
Combining the right skills with motivation, such as good working conditions, training, and flexible hours can work wonders. Being a key component in the warehouse, it enhances employee productivity and solves problems in warehouse management.
6.Picking Optimization
Picking is a major source of warehouse management issues, often stemming from errors during receiving or put-away tasks. Poor picking practices can disrupt inventory management systems, especially when urgent customer needs lead to rushed decisions and actions.
Solution: Radiofrequency and voice-directed systems are becoming more common, but some small operations still rely on paper-based systems. Regardless of the system used, full compliance is crucial, even when it seems counter-intuitive.
To ensure a smooth flow, solving this problem in warehouse management by maintaining accurate and reliable master data is key.
When exceptions occur, such as offering a substitute item or finding a wrong item in a slot, they must be recorded to ensure an accurate inventory record. Various picking errors, such as noting an excess of an item that is already reserved for back orders, can occur.
7.Quality Control
In many warehouses, workers responsible for quality control also handle picking, packing, and shipping, leading to errors that aren’t discovered until the product reaches the customer. This is especially common in pandemic situations, where warehouses are under pressure to ship more with fewer staff.
Solution: Implementing a separate level of quality control can improve inventory management, especially for the food and retail industry. This additional oversight encourages accountability and ensures that inventory issues are managed in a structured way.
A dedicated quality control function can track vendor accuracy, enhance stock rotation, and reduce the need for manual processing of warehouse items. Quality control systems help ensure that the overall warehouse management program operates as intended.
There you go, 7 problems in warehouse management and solutions, we hope this detailed analysis helped you!
FAQ: Solve these 7 Problems in Warehouse Management:
How to build a warehouse operations management team?
You can hire skilled managers, define clear roles, foster strong communication, provide training, and encourage collaboration to ensure efficient operations and problem-solving.
How to improve warehouse layout?
Start by analyzing workflow, optimize space utilization, use vertical storage, streamline pick paths, and ensure safety and accessibility for all items to maximize efficiency.
What are the common warehouse inventory problems?
Inventory inaccuracies, overstocking, understocking, poor space utilization and inefficient tracking systems can lead to mismanagement, increased costs, and reduced productivity.
Conclusion:
Addressing the problems in warehouse management requires strategic planning, the adoption of automated systems, and efficient resource utilization. Staying ahead of challenges ensures smoother operations and sustained success.
In case you’re looking for expert solutions and advanced technology, consider Qodenext. Our intelligent warehouse management and execution systems streamline warehouse processes, therefore allowing managers to effortlessly oversee every operational detail and effectively solve different problems in warehouse management.
