In the most general sense, these operations revolve around receiving and shipping.
Poorly-managed warehouses run into a host of problems, all of which impact profitability:
None of this is good for business. If warehouse operations aren’t in order, it becomes near-impossible to serve customers, vendors, and your own organization. Smart warehouse management, particularly the right warehouse management software (WMS), lets you do more while working less.
In saving time, money, and energy, you can reinvest these resources into spurring your business to further growth. Throughout this guide, we’ll take a close look at everything that goes into effective warehouse management. Before we get ahead of ourselves, though, let’s spell out some of the basics first.
What's the difference between inventory management and warehouse management? While the two terms overlap, there are key differences between inventory management and warehouse management.
Inventory management is focused solely on the actual items being held within a warehouse. As a part of your supply chain, inventory management includes aspects such as controlling and overseeing purchases — from suppliers as well as customers — maintaining the storage of stock, controlling the amount of product for sale, and order fulfillment.
Here, we’re looking at the people, equipment, and other resources being used at different stages — and how they all come together.
For a warehouse to run successfully, your approach must be based on a solid foundation. Let’s break down the key warehouse management principles to keep in mind as you develop your approach.
Perhaps the biggest mistake a warehouse manager can make is assuming that things are running as smoothly as possible because nothing seems to be going wrong.
Even if no problems seem to be occurring, that doesn’t mean the warehouse is running at its highest capacity. In reality, there may be a number of improvements to be made to the team’s processes that are being overlooked on a daily basis.
It’s important to note that being data-driven means more than just “considering” any data you’ve collected that may or may not lead you to a more informed decision. Rather, data-driven warehouse management involves looking at your data first, then coming to a decision based on what this data tells you.
In fine-tuning your approach to warehouse management based on solid evidence (rather than on hunches), you’ll ensure that every decision you make will lead to higher productivity.
In order to manage your warehouse effectively, you need to have complete control over all the goings-on within the building.
Basically, if you’ve found that doing x, y, and z will lead to more productivity, you need to know that your team is going to get x, y, and z done — and done well. An essential part of warehouse management is the creation of systematic workflows, processes, and protocols for your teams to follow throughout their daily operations.
With proper workflows in place, your individual team members will always know what they’re responsible for at any given time.
While control is essential, it’s also important to remain flexible. Why? Because warehouse operations do not happen in a vacuum. Your workflows and processes may illustrate the “typical” (and perhaps ideal) way in which your warehouse operates. But things aren’t always going to go according to plan.
It’s up to you, then, to enable your team to shift gears or change course “on the fly” whenever extenuating circumstances arise.
In other words, your warehouse processes should never be completely written in stone. If your data shows that a change needs to be made, it’s vital that your team is able to make the change with as little friction as possible.
To be sure, there are a wide variety of tools available to help you improve your warehouse management across the board. From warehouse and inventory management systems to data-collection tools (and much more), investing in the right technology can allow your warehouse to run as efficiently as possible.
However, this is more than using technology for the sake of using it. Rather, it’s important to seek out the specific tools that will help your warehouse team with your specific processes.
You’ll also want to consider how the other tools in your organization’s tech stack will integrate with your warehouse management tools.
Finally, it’s important to keep up with any tools and technology that emerges as time goes on. Again, it’s not about using newly-released tools just to use them — but you do want to know whether or not a new piece of technology will benefit your warehouse operations in some way.
Everything that happens within your warehouse is done so that your customers end up receiving the products they’ve ordered exactly as planned.
Note that it’s the customer who determines what “exactly as planned” means — not your organization. In other words, your warehouse operations should be tailored to your customers’ needs and expectations (while still ensuring maximum productivity on your end).
To illustrate this point, think about Amazon’s approach to fulfilling orders for Prime members. In most cases, the company pledges to deliver orders within two days’ time. In order to make this happen, Amazon’s warehouse processes need to be as streamlined as possible.
But, it’s not always a matter of doing more to better serve your customers.
In some cases, you might find that you can better serve them by removing unnecessary steps or promises. For example, if two-day delivery isn’t something that your audience absolutely requires, there’s no need to go “all-in” to make it happen.
This might mean offering a flexible return policy or providing further transparency regarding order fulfillment.
By keeping your customers’ true needs in mind, you can optimize your warehouse operations in ways that have a positive impact on their experience with your brand.
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