Gaining efficiencies in your warehouse with technology

Transform your warehouse performance and reduce fulfilment costs.

Matrix Park, Western Avenue, Chorley, Lancashire, PR7 7NB | T:01772 455052 E:hello@fulfilmentcrowd.com

Contents03Introduction

Warehousing layout

Mobile warehousing

Replenishment

Stock receipting and put away

Picking & dispatch

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IntroductionThis document is for anyone running a warehouse, who is looking to achieve efficiencies by implementing relatively affordable technology. This is not a document aimed at warehouses seeking automation using robotic picking systems etc.

Whilst this document covers most of the basic warehouse activities, it shouldn’t be considered a ‘comprehensive guide to running a warehouse’, just a list of the things you should probably be considering, in order to ensure you get the best out of your warehouse, your team and the technology you choose to implement.

Who is this document for?

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What should a warehouse management system deliver?

At the end of the day, the whole purpose of implementing technology into your warehouse is to ensure you know how much stock you have and exactly where it is. A warehouse management system of any quality, will allow for total visibility of the exact quantity of stock you have for any SKU, regardless of how many different locations you may be storing the SKU within.

Increased stock accuracy and visibility

Increased efficiencyEfficiency should almost be a by-product of improved stock accuracy. The introduction of stock locations will speed up all aspects of your day to day routines from stock put away to picking. Increased stock accuracy will reduce picking discrepancies and more control over your picking and dispatch processes will ultimately reduce the number of customer returns and increase customer satisfaction.

Warehouse layoutThere’s no right way or wrong way to lay out your warehouse. Most warehouses have evolved over many years to suit the products being housed within them, so it’s not possible to say that they are set up incorrectly. However this document is about implementing technology and technology can only be applied where there is a logical process.

Warehouse layouts tend to differ based on four factors:

• Average order size • Product lead times

• Number of SKU’s • Budget

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A mezzanine floor is simply an additional, semi-permanent, area for additional storage. It is usually more suitable for smaller, lighter items and slow moving stock items. Whilst mezzanine floors can be used to store bulkier items, this would generally require additional lifting equipment, which can be very costly.

Correct use of heightMost modern warehouses boast significant height. When looking to gain efficiencies within your warehouse and particularly when paying per square metre, the correct use of the height you have available is perhaps the biggest factor.

When height is available and of course when the budget permits, the main choice you need to make is whether to install a mezzanine floor, in order to allow for more picking locations, or to take advantage of the height for Bulk Storage. Again, the four factors mentioned above will be the key points to consider when making this decision.

Ideally, a warehouse will have a combination of different sized picking locations, pallet storage and a mezzanine for additional slower turnover picking locations.

Mezzanine floor

Mezzanine floors are best suited to smaller items and smaller order sizes, due to the practicality of moving the items from the mezzanine to the packing area.

Mezzanine’s can be an expensive option, but are ideal for those items with low stock holding and a slower turnover, i.e. items of which you only hold a small quantity, but may be sat on a shelf for a while.

Bulk or bulk above pick storageFor those people selling bulkier items a mezzanine floor really isn’t suitable. Often, depending on size and fragility of the items, the only way to store them is on the floor space, making height redundant. In those cases, where bulkier items can be palletised or storage, bulk or pallet racking is the obvious choice.

Bulk racking can also be very flexible, in as much as additional ‘left to right’ beams can easily be added, along with simple, relatively low cost board, to create shelving. Many warehouses which require space for picking small items will adopt a bulk above pick storage system, whereby the bottom section of racking is split into shelves, from the floor to an area just above head height.

This is the ideal solution for companies who buy stock in large quantities due to significant lead times. For example, when importing goods using shipping containers from China, it is not unusual for a company to buy several months worth of stock at the same time.

This allows a business to massively increase the number of SKU’s they can sell, without increasing the number of picking locations they use as, again with the right IT systems, a single picking location can be used to store multiple SKU’s.

Modern fork lift truck (FLT) technology, such as that used by ‘Bendi’ Trucks, allow for aisles as narrow as 1.5m. These FLT’s can lift pallets as high as 12.5m, maximising every square inch of warehouse ‘real estate’.

Pallet racking can even be used to support a hybrid mezzanine floor, which really offers the most flexible mezzanine or bulk solution, though again the costs can be fairly significant.

Using a pallet racking solution which allows for bulk over-pick and the right IT systems, a warehouse can easily manage the following: - Ensure picking locations always hold the minimum stock requirement, using

slow moving stock analysis.

- Easily manage replenishments from bulk to pick.

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BACK STOCKBACK STOCKINVENTORYINVENTORY

INVENTORYINVENTORYINVENTORYINVENTORY

INVENTORYINVENTORYINVENTORYINVENTORY

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PALLETTES U.B. KITS

RECEIVING

NEED ELECTRICAL & ETHERNET

CONDUIT DROPDOWN

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PALLETTES

Figure 1: Least Walk Picking

Least walk picking is an important consideration when planning the layout of your warehouse. This is simply the route your pickers will need to take when picking products for your customer’s orders.

The diagram in Figure 1 below shows the best route for pickers to take in order to collect their items in a typical warehouse. As you can see the route takes the pickers from the ‘Begin’ point through each aisle, eventually returning to the packing benches, without ever having to traverse the same aisle twice.

This is simple to achieve and may seem to be common sense. The warehouse in the diagram below simply allows space at the end of each aisle, for the picker to turn into the next aisle, how much space you leave, should really be determined by the size of the picking trolleys you intend to use for picking your orders.

Many warehouse planners decide not to leave space at the end of aisles, choosing instead to rack right up against the wall in order to maximise the use of space. Whilst there is certainly an argument for this, the time saving benefits of least walk picking can be incredibly substantial and in most cases will quickly recover the opportunity costs of empty space.

Least walk picking

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If you take the first aisle in the diagram (to the left of the ‘Begin’ arrow), it would not be uncommon for the aisle to your left to be considered the ‘A’ aisle, and the aisle to your right to be considered the ‘B’ aisle, with subsequent aisles labelled as ‘C’, ‘D’, ‘E’ etc.

A key component of least walk picking is to ensure that, as you walk down an aisle you are able to pick items from both sides of the aisle. This avoids walking down the aisle picking items from aisle ‘A’ only to have to walk back up the same aisle to pick items from aisle ‘B’.

An intelligent picking system will allow a walk sequence to be introduced, so that walk sort is not dictated by the alphabetical codes of the bin locations. For example, bin location codes.

Least walk picking

Trying to determine the best way in which to code your picking boxes or ‘bins’ can be quite a difficult task. Bin codes are often a sequence of letters and numbers, occasionally separated by hyphens ‘-‘ or slashes ‘/’ to make them more legible.

As a general rule you should try to ensure that all location codes within your warehouse follow the same generic structure, i.e. they share the same length and the same positioning of numbers, letters and separators.

In some instances a bin code may not actually need one of the numbers or letters, but this should be replaced with a ‘0’ or other null character in order to ensure the bin carries the same structure.

Your picking team will soon learn what the different letters and numbers in the codes mean and keeping the same structure will avoid unnecessary confusion.

To take a fairly complex example; A warehouse manager who looks after a warehouse which is split into three adjoining rooms. Each room is easily accessible but they are known to his team as warehouse one, warehouse two and warehouse three. Warehouse one and warehouse two have a mezzanine level, known to his team as the ‘upper’ levels, warehouse three does not contain a mezzanine.

Bin coding• Each warehouse and each floor houses several aisles of racking.• Each aisle is divided into natural bays formed by the upright beams of the pallet rack storage systems.• Each bay consists of four shelves which are used to hold picking stock and three levels of bulk storage.• Each picking shelf is capable of storing up to six picking locations.• Each pallet storage level is capable of holding two pallet locations.

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Bin coding

WAREHOUSE UPPER / LOWER AISLE LOCATION BIN CODEBAY SHELF

1 L A 1 1L/A/1A/11 A

1 L A 2 1L/A/1A/21 A

1 L A 3 1L/A/1A/31 A

1 L A 4 1L/A/1A/41 A

1 L A 5 1L/A/1A/51 A

1 L A 6 1L/A/1A/61 A

1 L A 1 1L/A/1B/11 B

1 L A 2 1L/A/1B/21 B

1 L A 3 1L/A/1B/31 B

1 L A 4 1L/A/1B/41 B

1 L A 5 1L/A/1B/51 B1 L A 6 1L/A/1B/61 B

Figure 2: Bin coding

The codes are built as follows:

The warehouse manager decides to hold each of the above identifiers as letters or numbers within the

bin code so that his pickers can pinpoint the exact location of any item, by knowing the bin code.

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The use of the ‘/’ separator allows the picker to quickly decipher the different areas of the code, i.e. ‘Go to this warehouse, upstairs / downstairs’, ‘Go to this aisle’, ‘Go to this bay and the middle shelf’, ‘Go to this picking location’. Changing between letters & numbers also helps. Notice how the bay’s are numbers & the shelves are letter. This could easily have been the other way round (i.e. a letter followed by a number), but two numbers or two letters together would be confusing & difficult for the picker to decipher.

As said above, warehouse one and warehouse two have a mezzanine floor. When labelling the mezzanine floor locations, the warehouse manager will simply change the 2nd character to a ‘U’ for Upper. Warehouse three doesn’t have a mezzanine floor, but the bin codes within warehouse three should still have a ‘L’ as the second character. It’s not needed as its obvious there’s not an upper floor, but it maintains the integrity of the barcode structure and prevents the picker from confusing the Upper / Lower character with the aisle character.

Bin coding

I have stated above that each of the shelves in my example could hold six bin locations. This doesn’t necessarily mean that the shelf will hold six separate picking boxes. It may be that some shelves contain bulkier items and can therefore only hold two or three different SKU’s.

Where this is the case, I would recommend that you still label your shelves with six locations (this could be eight or twenty depending on the typical size of your product). By doing this it means that you can easily move products around your warehouse, without having to re-label the bin locations.

Where a shelf contains six picking locations, but is only holding two or three bulky items, you should attempt to line up the left side of your picking boxes / product boxes with the bin location you consider it to be in i.e. if a shelf stores two items only, then it’s reasonable to assume that the first item would be in position one (1L/A/1A/1), whilst the second would be in position four (1L/A/1A/4), i.e. each product is taking up three spaces on the shelf.

Bin location labels

Obviously ‘Figure 2’ is just a snapshot of a few of the bin locations the warehouse manager has had to create. This may seem like a relatively huge exercise and indeed it is quite complex but by using tools such as MS Excel, once you have determined the coding structure you want to use, the above codes can be knocked together relatively quickly. Most IT systems will allow you to import your bin coding structure once you have created it and then simply modify or create new bins within the system.

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Whether you stick the labels directly on to your racking or on to your bins is entirely up to you and largely depends on whether you have static, custom made bins, which stay in the location (in which case you would label the bins), or if you tend to pick from the boxes the products are delivered in (in which case you would label the racking).

Later on in this document we will look at the benefits of using mobile devices in your warehouse to increase stock accuracy and to reduce picking errors. A crucial part of that system is the ability to be able to scan bin locations, to ensure you are putting stock into or taking stock out of the correct location. Even if you are not yet considering implementing mobile devices into your warehouse, if you are looking to restructure and re-label your bins, it’s worth printing them with a barcode now, so you don’ t have to redo the exercise later.

Note: You don’t have to register a load of barcode numbers with anyone or anything like that, the printed barcode is just a representation of your bin code, for example, (1L/A/B1/2).

There are many products on the market which can be used for printing bar code labels for your bins, most of which are pretty cheap Also, most will offer some kind of mail merge functionality, so your Excel spreadsheet can be used to quickly print off your labels.

It’s been a few years since I labelled our warehouse, but I used a piece of software called Bartender, which was relatively cheap, offered the above functionality and worked pretty well.

Bin location labels

Figure 3: Bin label stuck on the boxes

Figure 4: Bin label on racking

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Picking binsPicking boxes or ‘bins’ can be very costly and there is often an obvious temptation to go out and purchase the cheapest bins you can find. Any storage container sturdy enough to do the job can be used as a picking bin and in relatively low volume operations the design of your bins is largely unimportant.

As order volumes increase however, obtaining custom built storage containers for use as picking bins can reduce picking times,protect your products from damage, prevent items from falling into other locations, or down the back of the shelf etc, and even help prevent injury.

Figures 5 and 6 opposite show some custom built boxes for use as picking locations in a ‘bulk above pick’ environment.

The boxes which are at about chest and head height are similar to ‘crisp boxes’. They are fully enclosed to prevent items being damaged or lost, with an opening at the front from which to pick. These have been made to fit the locations and are therefore approximately 1m in length, allowing for the whole area of the shelf to be used.

The boxes at floor and waist level are larger, with an open top. These boxes can be easily pulled out by the picker who can pick from the top without needing to go down on bended knee.

Separators can easily be built into these boxes by simply using pieces of spare cardboard, allowing a single box to form multiple picking locations. Again, this particular box is approximately 1m in length allowing the whole area of the shelf to be utilised for storage.

Figure 6: Flexibility of the pallet storage system

Figure 5: Custom picking boxes

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Products such as clothing will often be sold as a ‘Base’ product with varying colours and sizes. Take for example a T-shirt, whichcomes in black, white and red and in large, medium and small.

Usually, when picking the T-shirt, the picker will easily be able to decipher black from red from white, but will normally need to take a closer look to determine whether the T-shirt they are picking is a small, medium or large size.

You could store all the different colours & sizes in one bin location, but this will slow down your pickers and ultimately, they will cost you more than the boxes and the space.

Colours and sizes

Occasionally, size is the variant, rather than colour or pattern. Take for example a company selling place mats and coasters.There may be several different styles of place mats, each with matching coasters. In this scenario, the products should be stored by style, as the size of the product would be easily identifiable by the picker; i.e. if someone orders some coasters with a particular pattern, the coasters would be in the same location as the mats of the same pattern, but the picker will easily be able to determine which is which by the size.

Perhaps the most cost effective way of making massive efficiency savings within your warehouse environment is to introduce a mobile warehouse management system.

Ideally, the variants of this T-shirt should take up no more or less than three locations. One picking location should be used for the small sizes, one for medium and one for large. Each location would hold all three of the different colours, in that particular size. This will minimise the space taken up by the product, whilst maximising the speed of picking.

In the main, a quality warehouse management system will provide a mobile warehousing application,

which should, as a minimum, allow for the following tasks to be carried out:

• Stock receipting and put away • Adjustments and movement of stock

• Stock replenishment • Basic product enquiries

• Stock take • Order picking

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Ideally, all of the above tasks should be carried out ‘online’, i.e. any changes made on the mobile device should be instantly updated on your main back office application. Where integration is required, higher costs, complications and inaccuracies are almost unavoidable.

For most companies, the introduction of mobile applications as a replacement for pen and paper within a warehouse environment can be a dramatic change and, as with all changes, it can face significant resistance. This resistance is almost invariably short lived however, and even the most belligerent of warehouse managers will soon be left wondering how they ever managed without one.

Mobile warehousing

The devices themselves are not cheap (around £800 each + the cost of a wireless network) and considering you may need quite a number of them, if you are to use them for all your warehousing activities the costs can mount up. However, the benefits of using these devices with a quality warehouse management system, will soon reap rewards and it won’t be long before you are seeing a marked return on your investment. Also, the devices are built for a warehouse environment and tend to be as tough as old boots.

Figure 8: Mobile warehousing by in action

Figure 7: Product barcodes are essential

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We have mobile devices in our warehouse that have been with us for over 7 years and are still ticking along nicely and most manufacturers will offer reasonable warranties and servicing.

Whilst most mobile devices will offer touch screen or stylus operated keyboards, entering bin codes and product codes in this manner can be very time consuming and all mobile warehousing devices will allow for fast scanning of barcodes.

A good warehouse mobile device will force your users to confirm that they are taking stock from, or putting stock into a particular bin location. This is after all the only way to guarantee stock accuracy. As outlined earlier in this document, it is therefore essential that your bin code labels also show a barcode. This is a pretty finite job and once done, shouldn’t take up too much of your time to maintain.

Product barcodes can be a bit trickier. These days, most products have barcodes already and any self respecting warehouse system will allow you to store the barcode numbers against your products, so that they can be identified by the mobile device.

Some products, such as nuts and bolts etc are sometimes considered too small to apply a barcode too, but more and more you will see these items in small plastic bags, with barcode labels attached. This has been done for a reason and should be proof, should proof still be needed, that the benefits of barcoding your products, will surpass the costs is a very short time indeed.

Given a little pressure, most suppliers will agree to barcode their products before sending them to you. Where this simply can’t be done, you have three choices:

1. The right choice: Barcode the items as they are received before they are put away.2. The lazy choice: Print barcode labels off and put them in the box with the items, so that they can be

bar-coded as they are picked or moved.3. The really lazy choice: Print off one barcode & attach it to the picking location or bin, so that it can be

scanned by the mobile device.

As a general rule, each and every item should be scanned at least 4 times from point of delivery to point of dispatch:1. Goods receipt 2. Stock put away

3. Pick 4. Dispatch

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Stock accuracyThe key benefit to using mobile devices within your warehouse is obviously the increased accuracy of your stock. Knowing that you have 100 of a particular SKU is largely useless, if you don’t know exactly where it is. If possible, you should ensure that any movement of an item is properly managed, from accepting the goods at the back door to dispatching them through the front door.

Stock accuracyAs some items are held in bulk storage, often they can be scanned a fifth time as they are moved from bulk to pick. If there’s one thing that can damage the integrity of your stock, it’s replenishment. If you don’t do it correctly, you instantly have incorrect stock in at least two separate locations. This level of checking may seem like overkill, but the benefits are enormous. The discipline that these procedures enforce within your warehouse will ensure that your stock is kept accurate, errors are minimised and orders are allowed to flow freely.

Learning curveAnother key benefit of mobile warehouse devices is that they can deskill jobs which would otherwise take days, weeks or months to master. When bin location codes and product barcodes are introduced, moving items, picking items, and even receipting and putting items away can be made easy.

When you consider the cost of taking on and training additional temporary staff to cope with seasonal peaks, getting people up to speed quickly is essential. If you peak on November 15th and can take someone new on November 15th, rather than a week earlier to give them time to ‘learn the ropes’, your potential return on investment for mobile warehousing can be huge.

Pretty much anyone, regardless of education or even language, can decipher letters and numbers, so moving product 5050854210358 from bin 1L/A/1A/4 to bin 2L/B/1C/5 is something that anyone can comprehend. A few years ago, when the Polish decided they would try English life for a while we recruited a number of them to work in our warehouse. Some of them couldn’t speak a word of English, but they were as keen as mustard and eager to learn. With our mobile warehousing solution we were able to set them to work picking orders. Given only a few simple instructions they were productive almost immediately and as everything they picked was validated by barcode, there were no picking errors.

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The process of stock receipting and put away is perhaps the most important process to get right in your warehouse. It’s perhaps also the most complex. If stock is receipted incorrectly or put in the wrong place, then it will more than likely remain incorrect until you next do a stock take. At which point, you’ll be cursing yourself for ordering thousands of pounds worth of stock for items you already had but couldn’t find.

Often those people who are managing the receipt of stock don’t really have any visibility of the actual order which has been placed with the supplier. Whilst this allows the warehouse team to soldier on merrily, it doesn’t really help your purchasing department, when they receive an invoice for an item they never purchased, but have somehow now sold, or lost in the warehouse.

Ideally, implementing a comprehensive warehousing IT solution will tie the purchase order management and stock receipting processes together. Again, this may add a few further disciplines as goods are receipted, but this should not be seen as a bad thing and, if done correctly, will save a lot of time for your purchasing department.

Stock receipting and put away

Knowing what to expectOne benefit of giving your warehouse team better visibility of your purchasing activity, is that they will be able to know what stock they should be expecting to receive and when they should expect to receive it. This will help your warehouse manager resource their goods-in team accordingly.

It should also be possible for your warehouse manager to quickly confirm when a purchase order has been received. This will allow your purchasing team to keep a check on any late deliveries so that they can start chasing up your suppliers.

Identifying stock received This can be one of the most time consuming jobs undertaken by your warehouse team It’s tedious, but if it’s not done correctly, it will lead to all kinds of complications further down the line.

Typically, when your warehouse take receipt of a delivery, they should at least know which supplier the delivery has come in from. If they’re really lucky, they’ll also receive a delivery note with a breakdown of the items that are supposed to be in the delivery. I say ‘supposed to be’ as not all suppliers will have a comprehensive warehouse and order management system, so there will no doubt be ‘unders’ and ‘overs’, from time to time.

For example, let’s say your warehouse takes delivery of a single box from ACME Supplies Ltd. They open the box and find that there are 10 x T-shirt in red, 15 x T-shirt in white and 20 x T-shirt in black.

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Identifying stock received That’s 45 separate items in a variety of different sizes (small / medium / large.) The delivery note accompanying the order matches the items found within the box.

A purchase order exists on your system order book for ACME supplies for the following, 15 x T-shirt red, 10 x T-shirt white and 20 x T-shirt black.

There’s clearly been a bit of a mix up ... 10 red T-shirts have been received and 15 white T-shirts have been received, where it should have been the other way round. If your warehouse management system and your purchasing system aren’t talking to each other, then the first you will hear of this will be when the purchase invoice turns up. By this point, the items have been put away, many of the extra white T-shirts have been sold and customers who were waiting delivery of their red T-shirt and whom had perhaps already been given an expected due date are calling your call centre to complain. It may be the last time they call your call centre.

This was almost too simple. Imagine if I’d decided to throw in the complications caused by the different sizes?

So how can these complications be avoided?By combining your warehouse management system with your purchase ordering system your warehouse team will be able to see exactly what items they were expecting to receive. They should even be able to book the stock in through the system by confirming certain lines on the original purchase order.

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Your warehouse team should be able to easily identify the purchase orders that you are expecting to receive from ACME suppliers Ltd. They would then be able to see how many T-shirts they were expecting to receive in each of the different colours and sizes.

It would be apparent almost immediately that there was a problem with the delivery, as you would have an ‘over’ on the white’s and an ‘under’ on the reds. This could then be raised with purchasing who could make a decision as to what to do with the additional items and could contact the supplier to request delivery of the shortage.

Without mobile warehousing

Without mobile warehousingPurchasing could then update your system with the expected receipt date for the shortfall of red T-shirts and, assuming your systems support it, your system could then automatically contact your customers to make them aware of the new delivery date, saving all kinds of trouble for your customer service team. It’s nice when everyone works together.

Without mobile warehousingOpen the box, scan the items, press a few buttons. A comprehensive warehousing system should be able to analyse the items scanned, analyse the open purchase orders for the supplier and reconcile automatically. Any ‘unders’ or ‘overs’ would still need to be manually dealt with by purchasing, but stock accuracy would be absolute.

Stock receipting - stock put awayThe process of putting away items once they have been identified and reconciled to your purchase orders can vary dramatically depending on the size of the delivery, your business processes and the type of items requiring put away.

Volumetric measurement is perhaps the best way to manage this process, but this can be very complex to set up and maintain.

Putting stock away should really be seen as a process of replenishment; i.e. you are replenishing your pick / bulk storage areas using the stock that currently exists on your warehouse floor. Ideally your system will contain either volumetric details of your products and stock locations or simple stock levels. i.e. one way or another your system should know how many of a particular item should be on your pick face.

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Where your products are all of fairly similar sizes (books, cd’s, dvd’s etc), volumetric measurements are perhaps your best option, but where you stock a wide range of products in different shapes and sizes volumetric information can be difficult to gather and difficult for some to understand. For this reason, most companies choose to set stock levels against their SKU’s signifying the quantity of the item that can fit on their pick face.

Your mobile warehouse applications should offer a little more flexibility. You would expect to be able to complete a replenishment as above, but without the paper and without the need to enter adjustments and confirm movements manually on your system.

Your system may also allow you to undertake more ad-hoc replenishments, i.e. someone picks up an item from the floor, scans it and the system tells them which picking location to put it into. They confirm that they have put it away and go and grab the next item. The method you choose will depend largely on the size of the delivery, the size of your items and the size of your warehouse.

Some mobile applications allow for pallets to be built up and put away, this can be an invaluable time saving tool; i.e. scan multiple SKU’s onto the same pallet and at the end of the process tell the mobile system where you have put the pallet, this should instantly update your back office system and move all the items from your warehouse floor to the new pallet location.

Again, mobile warehousing will instil disciplines that will ensure your team scan each and every item into the correct bin locations, ensuring the integrity of your stock is maintained.

Without mobile warehousingYour replenishment system should be able to produce a report of products and quantities which should be put into your picking location and exactly where you should be putting them. If you’re using volumetric information, your system may also try to suggest bulk locations for your overspill stock, but in practice it’s often easier just to pallet up the goods and go looking for the next available space.

Stock placed on a pallet will have to be properly counted and your systems will need to updated using a more manual replenishment.

Mobile warehousing

A Replenishment is simply the movement of stock items from one location to another. This could be done to replenish your pick face, move stock from one store to another or simply just to move things around in your warehouse.

Stock receipting and put away

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There are three main reasons to undertake a replenishment:1. Replenishing a location to ensure it is at an optimum level.2. Replenishing a location to make stock available for demand.3. Moving stock to prepare for future demand.

As mentioned during the ‘put away’ section of this document, it is fairly standard practice on most warehouse management systems to maintain optimum stock levels for items within locations.

In the replenishment scenario, a location could be a bin on your pick face, or perhaps another store.

Example: ACME Retailer Ltd. runs a mail order business and has both a main warehouse and also a small high street retail shop. They have purchased 100 x TSHIRT-RED-SMALL and these are all currently in their main warehouse in a bulk location. The following stock levels exist:

CURRENT STOCK

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Figure 9: Example of stock levels

The small amount of information in figure 3 should be enough for most warehouse management systems to be able to automatically suggest stock replenishments within your system.

Effectively, the replenishment systems should be able to determine that the stock on the warehouse pick face has fallen below its recommended threshold and should therefore suggest to replenish 16 from the stock available in the bulk location into the warehouse pick face in order to take stock from the current level of 4 up to the optimum level of 20.

Optimising locations

Optimising locationsLikewise, the system should be able to recommend transferring 4 x TSHIRT-RED-SMALL to the shop as this has also fallen below its recommended level.

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Ideally replenishment of this kind would take place on at least a weekly basis. Ensuring your pick face has the optimum level of stock will reduce the need to perpetually perform replenishments by demand.

In many organisations once an order is placed a picking note is produced, regardless of the stock location of the items on the order. This can cause a problem where a picking note is produced which includes items which are inaccessible, i.e. on a pallet in high storage or even in a separate store. Often the picking note will be ‘put to one side’ while the fork lift driver is on lunch or busy with another job. This order can all too easily end up being forgotten about entirely, or at best delayed.

This not only causes a delay with that specific order, but also slows down the picker, as they have to stop picking part way through an order, while they could be busy picking orders that were actually accessible.

If your warehouse management system is fully integrated with your sales order management system, then this problem should be avoidable. Ideally, an order will be held back, preventing a picking note from being printed until stock for all of the items on the order are available within your pick face.

You should then be able to run a replenishment which should be able to automatically calculate those items which are preventing orders from being picked and the quantities that need to be replenished. This is an excellent method of ensuring your picking team are always being productive, as everything they are being asked to pick should be readily available to them.

By demand

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The options for improving the efficiency of picking orders in your warehouse are vast. Millions of pounds can be spent on robotics, conveyor belts and other infrastructure to reduce the manpower needed to pick your orders, however that’s not what this document is about. This is about cost effective, simple to introduce changes that can make your pickers and your processes more efficient.

Firstly, if you’ve already decided NOT to introduce bin locations into your warehouse, stop reading now, as there’s nothing more you can do. Your picking processes will always rely on man power and product knowledge. They will always be a skilled job requiring years of ‘know how’ or more importantly ‘know where’.

Unfortunately, even if you have decided to implement bin locations, they’re not much good to you if you don’t have a system which can intelligently determine the best locations from which to pick the items required to fulfil an order. Assuming you have adopted bin Locations and assuming you have decided to opt for a system capable of using them, read on... Unless you’re bored to tears of course, which I realise is a distinct possibility.

Picking & dispatch

The following assumes your new system is capable of doing everything already mentioned in this document and that you have been able to lay out your racking and code your bin locations in such a way as to allow for least walk picking.

The dream scenario

Your bins are labelled up with barcodes and your products are all nicely bar coded too. Everything discussed in this document so far has been for this moment. The Pick! If you can get your pickers doing nothing else all day long, other than picking items off the shelves with the bare minimum of picking discrepancies and with absolutely no picking errors, whilst walking not 1 metre more than they absolutely have too, you’ve cracked it. Just imagine how many more orders you will be able to pick without having to increase the number of pickers in your team.

If your system is up to scratch, it should have already filtered out any orders with stock or credit issues and should not be allowing any orders through to picking, unless the items on the orders can all be picked directly from your pick face.

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All you have to do now is figure out the best way to pick your orders. This will pretty much depend on one thing, size. If you are selling bulky items or if your average order size is greater than 10 lines, you will probably be best picking one order at a time, as this will be the most a picker can manage to comfortably pull a picking trolley round with. If your orders size is less than 10 lines and your items are of the smaller variety than multi order picking is where it’s at.

ACME Wholesale Ltd. distributes office supplies to retail stores. Average order sizes can be upward of 50 lines, so orders are picked individually in large trolleys. For each order a picking note is produced at the main warehouse printer, detailing the items required and their location within the warehouse.

The dream scenarioIf your system is worth its salt, it should be able to intelligently split your orders into large or small and also allow you to undertake a combination of single order or multi-order picking.

PaperworkEven with all the technology in the world, for now at least you will still need to have some paper if only for a delivery note. Deciding what paperwork you need to produce and when you need to produce can be a key component of perfecting your picking process.

Large order example

Costs to consider:1. One fairly heavy duty picking note printer.2. Compact laser printer for each dispatch station.3. Label printer for each dispatch station.

With this example there are obviously some fairly hefty hardware costs, though a reasonable network ready laser printer can usually be obtained for less than £100. The smaller label printers are a bit more expensive at around the £190 mark, though often carriers will provide these for you free of charge if you ask them too.

As an order pick is completed, the order is dispatched from one of seven different dispatch stations. Each dispatch station has its own compact laser printer which prints out a sales Invoice and or a packing note which can go in the box with the goods. Each dispatch station would likely also have a dispatch label printer which should be able to integrate with your couriers system to automatically produce a carrier label and add the order to the daily manifest.

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AMCE Retail Ltd. therefore decided to adopt a multi-order trolley slot picking system. This may sound very hi-tech but it’s really just a case of dividing a picking trolley into different slots or areas for an order.

Figure 10: Picking Bins

Figure 11: Multi-carry trolley

There are a variety of picking trolleys available, the type of trolley you get and the number of orders / slots you think you can pick at a time is largely dependent on the number of items on an order and their typical size.

ACME Retail Ltd. decided that they can pick 12 orders in a trolley. They don’t particularly want to have to install laser printers on their dispatch stations due to the space they take up and the cost. They have 130 orders awaiting picking, they therefore want their system to do the following:

1. Print off dispatch notes for all of the 130 orders awaiting picking.2. For every 12 orders printed, print off a bulk picking note showing the items that need to be picked along

with a picking reference. The lines on the picking list will show the product, description, bin location, quantity and slot number (1 – 12).

3. Each dispatch note will need to show a slot number (1 – 12) and a picking reference.

Small order multi-order pick exampleACME Retail Ltd. distributes stationary supplies direct to the public. Average orders size 2 – 3 lines, their products are, in the main, relatively small, easy to handle items.

Small order multi-order pick example

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Once all dispatch notes and picking lists have printed off a picker will grab the top pick list and the corresponding 12 dispatch notes (which should printed in sequence) and grab a trolley.

The dispatch notes will have a slot Number (1 – 12) which will correspond with the 12 red boxes attached to the trolley. The picker will therefore place each dispatch note into its corresponding box / slot.

The picking list will have printed a line for every product on every one of the 12 dispatch notes. Alongside each line will be a slot number which will also correspond to that printed on the dispatch note and therefore to the slot on the trolley. The lines on the picking list will be sorted by the least walk sequence.

The picker will therefore set off with the trolley and head for the bin location on the first line of the bulk picking list. The picker will pick the relevant item from the picking location and place it in the relevant slot on the trolley before heading off to the next picking location. This will be repeated until all items on the bulk picking list have been picked and all the slots have been filled with the relevant products for each order.

Once the pick has been completed the trolley will be left at the dispatch area for a packer to complete.

Your packing benches should be configured to be as efficient as possible. There are three common things that slow down packers:

Dispatch

• Insufficient packaging.• Determining which carrier to use to dispatch the parcel.• Producing labels and updating manifests.

Your Packing Benches should allow for storage of all relevant packaging material which your packer is going to require. A packer should not be left looking around for packaging to use. Some organisations feel that boxes should be reused, in order to be environmentally friendly.

Whilst this is commendable, it can slow packing down to a snail’s pace. Old packaging can be recycled easily and cheaply. Alternatively, you could purchase a cardboard shredding machine. Whilst these can be quite costly, the resulting shredded cardboard can be used as packaging filler, replacing the need for bubble wrap.

Packaging

In order to minimise dispatch costs and avoid an over reliance on a single courier, many companies seek to partner with a number of different couriers. Whilst this can indeed reduce costs, it can cause significant complications for your packers, who may well end up weighing and even measuring packages to determine how they should be dispatched.

Carrier selection

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Most warehouse management systems will allow you to store item weights and volumetric measurements. A good system will also allow you to set up a number of different carrier services, along with a logic as to which ones should be used, i.e. next day deliveries over 2kg go City-Link, whilst those under 2kg go Royal Mail, etc. This takes the decision making away from the packer, speeding up the packing process and deskilling the role, making it easier to staff up during busy seasons.

Carrier selection

Labels and manifestsAll good carriers will have their own systems for producing labels and updating manifests. The vast majority will allow for 3rd party systems to integrate seamlessly, so that labels can be produced without the need to re-key information into the carrier system manually.

So, the dispatch process should be as simple as selecting an order, packing the box and clicking the ‘Complete’ button. This should automatically determine the carrier to use and print the relevant label.

A dispatch station should just need a fairly low spec PC and a thermal label printer. If you are shipping a high enough volume of orders, you may find that your courier will provide the hardware for you, at least the printer if not the PC.

Hardware

If you are dispatching large volumes of orders, get your system supplier to print a barcode on top of your picking document / dispatch note. A relatively cheap handheld barcode scanner can then be used to speed things up a bit.

Some systems will allow you to manually confirm products being dispatched. This is good practice and it will cut down your returns considerably. Again, a relatively cheap handheld barcode scanner can be used for this purpose.

If you are printing dispatch notes or invoices at point of dispatch, you will of course need a laser printer. Try to get network printers if possible, as these seem to be more reliable and small ones can be picked up relatively cheaply.

Whilst you would expect all warehouse management systems to be capable of some of the functionality outlined in this document, very few will be capable of doing all of it. fulfilmentcrowd

software, will do all of the above and much, much more.

To find out more about what this remarkable system can do to transform your business, call our team for a friendly chat.

Get in touch

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