December 30th, 2023 | 3PL, Logistics

Warehouse Fundamentals

What can you do to improve your warehouse efficiency? Below are twelve points that every warehouse operation should consider. Each warehouse operation is different and the optimal WMS configuration will vary from one operation to another but the points below are the ‘WMS basics’ that need to be addressed first.

Wairehouse aisle, optimised slotting logic
Wairehouse aisle, optimised slotting logic


1. Use warehouse locations

If you rely on staff knowing where everything is or having to arrange SKUs in alphabetical order to find them, you’re locked into a really inflexible approach that will severely limit the options open to you when you try to increase warehouse efficiency and productivity. Tying stock to fixed locations is an inefficient use of space and prevents any optimisation of slotting and picking processes. Introducing new products becomes disruptive and training new staff will take far longer than it should.

If SKUs are given a dedicated ‘home’ location in the warehouse every SKU has to be given enough space for the maximum quantity that will ever be present. As it’s very unlikely that all your products will be at this maximum quantity at one time there will be lots of empty space in your racking. This low stock density is not only an expensive use of space, it will also require your staff and/or forklifts to travel greater distances than necessary, slowing down all the key warehouse operations.

Every warehouse should have a location numbering scheme that’s intuitive and completely independent of the SKUs the locations might contain. This is probably the most fundamental requirement for introducing a warehouse management system (WMS) and is a prerequisite for all the points below.

Staff can waste valuable time trying to work out the best location for incoming stock and how to put it away. Your WMS should provide a quick and efficient process for stock put away which maximises space and visibility, it should also apply the ‘slotting logic’ or ‘putaway rules’ that should be applied.

2. Replace paper with handhelds

Dedicated warehouse handhelds are expensive but in most cases the benefits of introducing product barcodes and handhelds far outweigh the cost. Many operations find that the majority of their SKUs are already barcoded when they arrive, but even if you need to add barcodes as part of your receipting process it’s still worth doing.

In many cases, it’s not necessary to barcode individual items. Barcoding the outer carton can be a useful approach for those products that don’t already have a manufacturer barcode on each item. It’s important that your WMS is able to support multiple barcodes for the same SKU so you don’t need to relabel existing stock if barcodes change or if you want multi-source interchangeable products from different manufacturers.

Experienced pickers can work at impressive rates but during periods of pressure mistakes will inevitably creep in, especially if you need to rely on temporary staff. A modern WMS used with hand-held scanners will vastly improve your picking accuracy. Pickers will automatically be sent to the correct locations and will be required to scan either the source location, the product being picked or both. If the product is not barcoded the user can be required to click on a product image before they can progress to picking the next item. It is important not to underestimate the cost of inaccurate picking. Time spent searching for the required items and correcting picking errors that have been identified at the packing stage is costly. If an incorrect order is dispatched there is the cost of handling returns and sending out the correct item. Finally, there is the potential loss of reputation and customer loyalty which will result in the loss of future sales.

Once your operation is using warehouse locations, product barcodes and handheld scanners, it will be possible to know exactly what stock you have at any given time and to know exactly where it’s being held. Perhaps more significantly, mispicks and other errors can be eliminated at source, even when new staff join your team.

Your WMS should be smart enough to allow you to introduce barcoding in stages rather than requiring that everything is barcoded before you can introduce handheldd processes. OrderFlow will allow users to click on an image of the SKU if it hasn’t yet been associated with a barcode.

3. Stop re-keying data and bouncing between multiple systems

Manually re-keying or cutting and pasting information is slow and error-prone and completely unnecessary. This is often done to produce courier labels or CN22 documentation, but it shouldn’t be a part of any day-to-day warehouse operation. Similarly, it should be possible to complete all the key warehouse operations from within a single WMS environment.

Processes that require users to log-on to multiple platforms to generate courier labels, update the status of orders when they’ve been despatched or to adjust stock will not scale as your business grows and will allow the possibility of costly manual errors. Make sure that your WMS has a range of integration options, a public API and can support integration with all the external systems you need it to talk to.

4. Avoid picking one order at a time

The most obvious way to process orders is to start with the oldest one, pick it, take it to a packing bench, pack it and repeat. Although this is the simplest way to process orders, it also requires the picker to walk far farther than necessary and repeatedly visit the same locations to pick items in ones and twos.

Unless your orders are incredibly uniform, a system that requires you to process all your orders the same way is going to be highly inefficient. It’s useful to consider your typical Monday morning orders and think about how you’d subdivide the pool to process them most efficiently. Choosing the right picking strategies for your operation and making sure they are regularly reviewed and tweaked is essential, if your current WMS doesn’t allow you to do this then it’s costing you money in wasted time and missed delivery deadlines.

5. Reduce the time spent sorting picked items before you can pack them

Picking each order individually is clearly inefficient, wherever possible your WMS should group orders together in a way that maximises the efficiency of your picking process.

However, if it’s not done carefully it can just move the bottleneck from the picker to the packer, as your packers have to sort through a mixed tote to find the items they need for a particular multi-line order. This can be reduced by limiting the number of items picked or picking into subdivided carts. This way, when a cart is presented to the packer the stock’s already sorted by the orders it’s being picked for. The aim should be to spread the workload equally between the pick and pack operations so that orders flow through both processes at roughly the same rate.

6. Pick your best selling products and product combinations efficiently

In most environments, a small proportion of the product catalog represents a significant proportion of the orders despatched every day. If these popular products or product combinations are not identified and processed separately you are missing an opportunity to make significant savings.

The 80/20 rule might apply to a few of your most popular products, perhaps you have well established top sellers, they may be determined by product promotions, or it may change day-to-day as a result of factors that can’t be planned for.
So you need an order processing platform that allows you to identify the orders for your best-selling products automatically and group them together.

7. Stop concentrating stock in just one pick location

If you have a picking face that’s spread over more than a few aisles, and contains a large range of SKUs, it makes sense to spread the stock around. Amazon does it and there’s no reason why you shouldn’t too.

Make sure your WMS allows you to control the ‘slotting’ logic that determines where SKUs are put in the picking face. At its most basic it should ensure that each of your most popular products are spread around so they’re present in every aisle. This will dramatically increase the proportion of picks that can be completed within a single aisle and reduce the distance your pickers have to walk.

Your WMS should allow you to put more than one SKU in a location where this is appropriate but also ensure that similar looking SKUs are not held together. Even if every item is barcoded making sure that similar looking items are never  held together in pick locations will speed up your picking.

8. Optimise your inventory levels

A modern WMS should provide real-time information on stock levels and order volumes as well as the historical data needed to help you manage your stock levels effectively. Live stock level feeds to your sales channels will avoid overselling of stock. Accurate inventory tracking and re-order alerts will help avoid costly out-of-stock losses. Informed decisions can be made when you replenish stock so you can also avoid issues such as overstocking which will affect your cash flow.

9. Make it easy to introduce new team members

Introducing new members of staff to your warehouse should be straightforward. In particular, having been given a fifteen minute introduction to either the picking or packing process they should be up to speed very quickly, and it should not be possible for them to make mistakes.

If your warehouse processes are complicated by lots of workarounds, exceptions and funny little rules that have built up over time it can be almost impossible for new and temporary staff to start and the whole process becomes more susceptible to errors whenever a new person is introduced. All the business rules surrounding each warehouse operation should be configured into the WMS processes that you use to support them.

10. Know where the time’s going and what it’s costing you

If your users are working in a paper-based warehouse it can be hard to get an accurate picture of how much time is spent in each of your main processes. You need to know what a realistic man-hour cost is for your operation and how many man hours a week are spent in each of the main warehouse processes. When you do it becomes possible to ensure the costs associated with improving your warehouse efficiency are justified. On a day-to-day basis, a modern WMS will provide you with dashboards that give the visible needed to manage your resources proactively and efficiently.

11. Work with a WMS that can change and evolve

Warehouse environments are not static, your WMS needs to be able to adapt to the changing needs of your business. You should be able to introduce changes quickly and cost-effectively. One aspect of this is the flexibility of the WMS platform itself but the quality of the technical support you receive is just as important. If you have to wait weeks or even months to make straightforward changes you are working with the wrong partner.

12. Specialist Warehouse Requirements

Running a warehouse is always going to be complex but if you need to track stock or manage temperature-sensitive goods it becomes even more difficult and time-consuming. In these circumstances a flexible WMS provider who can adapt the system to your needs becomes invaluable. If features such as lot tracking, serial number tracking, support for multiple units of measure, FIFI and FIFO management are critical to the effective management of your operation it’s critical that you work with a partner that has experience of these areas and will take the time to understand the nuances of how they need to be implemented in your environment.

Let Us Help

If you are coming up against the limitations of your existing WMS or are struggling to get the support you need get in touch with OrderFlow to see how we can help. Our team of multi-skilled professionals has a wealth of experience in the world of warehouse management, our OrderFlow platform provides a scalable enterprise WMS that can deliver the changes you need.

Why not give us a call on 01249 750564 or drop an email to to find out more?