In this weekly warehouse tips edition we will introduce some of the top supply chain software, professional services and automated data collection technologies that can help you implement industry best practices that can optimize your warehouse. Utilizing these tools will provide your staff with real time data at their fingertips which will allow them to more effectively manage daily operations while improving profitability across the organization and on a per customer basis.
Tip # 7: Centralize information
Use software to help you integrate information regarding orders, inventory and other data in one location so that all members of your team have access to it in real time. Make sure that the WMS software you select can integrate information across all warehouses and related facilities including third party logistics providers.
Having the ability to manage multiple warehouses and facilities from a centralized location can help reduce errors, improve order fulfillment rates and enhance customer satisfaction rates.
Here is an example of how this can help manufacturers and processors. Manufacturers sometimes utilize contract packagers and contract manufacturers. These companies may not use warehouse management solutions so aging inventory may not be adequately tracked and reported, leading to loss. By using a WMS that has the capability to manage multiple facilities across the enterprise, your business can decrease losses from aged inventory and have greater visibility and control over inventory and orders.
Tip #8: Invest in technology tools and resources to support your infrastructure and warehouse operations
Make sure that your business has the tools to monitor and maintain the required performance levels to meet customer expectations. Having the technology you need to provide real time, accurate information can produce big pay offs in terms of operational efficiency and workforce productivity.
Here are a few examples:
- Mobile device management (MDM) service: This can be provided by a third party vendor or using software in order to remotely access mobile devices in the field to troubleshoot, secure, update software and perform other tasks. By using mobile device management, your business will benefit from having greater uptime, improved labor productivity and efficiency at a fraction of the time and cost associated with keeping devices up and running without these resources.
- When was the last time you evaluated your wireless network? Making sure that your facilities have full coverage in all affected areas can save valuable time and reduce errors and wasted labor.
- Make sure that you always have an adequate supply of batteries and accessories for your mobile devices. Keeping printer ribbons and related items on hand is another business essential.
- Find a mobile computing hardware/equipment service vendor who can provide a variety of services including warranty, extended warranty and repair service based on time and materials. Ideally, try to find a vendor that can provide you with loaner devices and buyback service to get the most out of the service and keep devices in the hands of warehouse workers.
- Consider implementing additional technologies such as pick-to-light, voice, cartonization and the latest material handling solutions to increase operational accuracy, speed and workforce productivity of your business. Today, consumers place high demands on real time, accurate information visibility and fast delivery. Leveraging technology in the warehouse can reduce order processing time, errors in picking and shipping and keep costs down so that you can win and retain customers.
Tip #9: Reduce misplaced inventory and wasted time using passive RFID
Many 3PLs and warehouse operators report that warehouse workers spend too much time searching for misplaced or lost inventory. Supply chain businesses are often concerned about the cost of implementing RFID in the warehouse.
One way to remedy this is to place RFID tags on pallets and use passive RFID portals in specific locations to help track the movement of the pallets. Using RFID middleware and a warehouse management solution, you can then narrow down the location of the inventory to a smaller area.
Tip #10: Get a “heads up” by using Advanced Shipping Notification
Advanced shipping notification, also known in the supply chain industry as ASN, provides you with details about the timing, contents and packaging of upcoming deliveries. By receiving this information before goods are delivered, your warehouse can be better prepared in terms of staffing and resources to process the deliveries. Using ASN enables you to properly produce workforce schedules, plan for crossdocking and enables you to track goods in transit.
Typically ASNs are sent via EDI as either an ANSI X.12 856 or the EDIFACT DESADV document. When the goods arrive, the pallet barcode is then scanned and the information correlated with records within the warehouse management system. Warehouse workers then can have access to information that identifies the shipment supplier, purchase order, anticipated contents and next destination.
Using advanced shipping notification can help reduce the time involved with receiving goods and result in a streamlined process.
Tip #11: Analyze your profitability on a per customer basis
In order to make sure you have a detailed understanding of the activities that make your business money, it is a good idea to examine the cost and profitability of each of your customers. To do this, you will need to produce reports using your warehouse management solution in “drill down” detail.
Ideally, you should be able to use the reporting feature in your WMS to provide detailed information about revenue streams and the cost your business incurred in generating that revenue. This will involve producing reports related specifically to labor and other costs.
In the 3PL industry, 18-23% is considered a solid profit margin on a per customer basis. Once you have the data, consider evaluating the current rates you are charging your customers and make sure you adjust pricing when warranted.
After examining this data for each of your customers, evaluate your warehouse as a whole. A solid profit margin for a 3PL warehouse operation tends to be between 10 and 14%. Use this information to produce graphical illustrations of the data in dashboard format and monitor this monthly. This will make it easier to see trends and recognize issues that require change.
In evaluating this data, consider what changes you can make to maximize profitability for your company. Once you implement these changes, make sure you record when the changes occurred and continue to monitor the results to see if you are on the right track.
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