Most companies don’t focus on the putaway process because it isn’t as obviously tied to revenue or business operations as fulfillment. That means lots of time and money spent on optimizing pick and pack, without thinking about how putaway prepares goods and teams to operate at their peak.
The initial placement of goods in your warehouse matters. When it’s done right, it makes every other process faster and easier. So, your goal for the second half of 2020 should be to optimize this putaway process to keep things running smoothly and potentially improve your margins. There are a few different options and requirements for it, but they all tend to pay off well.
Here, we’ll break down our optimization thoughts into three phases:
- System and process planning
- Executing changes
- Long-term considerations
It all starts with understanding your warehouse, so let’s begin with a look at your processes.
1. System and Process Planning
The first phase is all about getting your operations ready for optimization. You want to review how you collect data or begin that process. Try to track worker efficiency, putaway times, count accuracy, and more for the physical actions your team is taking.
At the same time, it’s good to review that your system is currently tracking the items in the orders you fulfill. Track size, weight, and how frequently you have to restock based on order volume, inventory levels, and order data. Grab as much as you can so you have the best information to optimize both activities and your physical warehouse space.
Data should be simple to track and analyze. If you’re struggling with these items or other workforce and warehouse analytics, it might be time to upgrade your tools. Start with looking for warehouse management systems (WMS) that help you track the necessary information. If you have this, look to modernize with something that tracks how far each worker walks and shelf locations, as well as providing optimization support for where to put products and bins.
Leading WMS tools also integrate with ERP and order management tools, helping you automate processes, including inventory counts and restocks. They can help you compare carriers, sizes, and other information designed to reduce your shipping costs.
Review your warehouse location, the steps your team takes, and how many people are involved in the complete putaway operation. This will give you an idea of your needs and processes, allowing you to ensure all are measured and highlighting where changes can occur.
2. Executing Changes
Once you have your baseline data and can track changes, it’s time to start making those changes. Remember, you want to optimize across all of your putaway efforts — that’s every touchpoint from the dock to the final warehouse storage location where pickers will get items for order fulfillment.
The chief goal here is to speed up putaway while maintaining accuracy, so you’re looking to reduce how far people walk, minimize how many steps are needed to get something to its final location, ensure safety, and optimize your space.
In warehouses we’ve studied, and for some clients we’ve worked with, up to 75 percent of their labor cost simply covers walking back and forth. Maximize putaway by reducing this travel time as much as possible. Turn to your WMS to help you optimize product placement and even overall warehouse layout. It’s worthwhile and can support your growth in the long run.
Here are a few tips for minimizing travel and optimizing your efforts:
- Create a location near your receiving area to check goods and store damaged products.
- Move high-volume products near your pack locations so your most common orders are fastest to both put away and to fill.
- Define the shortest routes and paths through a warehouse, then use tools to guide employees along these.
- Create one-way lanes and locations to reduce congestion, waiting, and accidents.
- Eliminate staging areas where possible. Directly put away goods often so you’re using space efficiently and not having to make multiple trips to manage initial putaway.
- Assign people to clean your warehouse regularly. It makes a world of difference for having space that’s easy to use and for avoiding accidents.
A smart WMS comes into play here as well because it can start automating and optimizing some efforts for you. Look for a solution that lets your team scan items as they are unloaded off a truck and then as they’re placed on a shelf for verification — or scan them separately if damaged. What’s best is when your system requires people to scan the product as well as the shelf where they’re placed. This keeps inventory levels accurate and allows you to restock as soon as you hit specific levels.
You might also be able to identify products that are often kitted in the warehouse, and determine a space near the assembly location that helps keep goods moving with fewer touchpoints.
No more eyeballing inventory at the end of a shift or miscounting because the wrong product is in the wrong bin. RFID tags and sensors can help you go a step further by automating much of your verification for overall inventory management.
There are many potential changes in these processes. Look to your WMS and other tools to help you define them and track results. One thing that is just as important is how you train your staff. Work with them to address changes, explain the reasoning, and then monitor to ensure new practices are followed. You need to keep on your team until these shifts become habits. You won’t maintain any gains if someone tries to work around the new change or revert to old ways.
3. Long-Term Considerations
Different putaway optimization processes and tools make distinct impacts based on your team, warehouse, and overall efficiency. Some solutions are going to yield substantial changes while others make small impacts. It’s up to you to determine where you’re seeing the most significant improvements and reinforce those gains.
It all starts with monitoring putaway before, during, and after any change. That reality makes the development of a monitoring and recording system your first goal. Review the metrics your WMS can track and look for the gains you’ve made or the time you’ve saved. Increasing inventory count accuracy can be just as important as shaving a few minutes off each process, for some.
For many companies, changing putaway processes includes updating to a brand-new technology, like a WMS. Turning short-term gains into permanent ones takes specific focus here. You want to train your team on how to use the software continually. Review workflows and how to use tools throughout your operations. Monitor teams and activities to ensure people don’t use a new method for a little while and then revert back to old habits.
One top method for ensuring this change is to give people control over reporting and other processes while asking for feedback. You may identify changes in techniques or elements, such as who does the new reporting. Encourage staff interaction and make the most of your changes by allowing them to be a part of decisions.
The better you can manage your putaway process in the beginning, the more likely your teams are to follow through with updates and continually deliver an ROI for your efforts. Remember, every gain in putaway can yield a significant benefit to your pick, pack, and other fulfillment activities.
Jake Rheude is the Director of Marketing for Red Stag Fulfillment, an ecommerce fulfillment warehouse that was born out of ecommerce. He has years of experience in ecommerce and business development. In his free time, Jake enjoys reading about business and sharing his own experience with others.