How to Organize Inventory in a Warehouse

Warehouse inventory management lies at the heart of maintaining an adequate facility. Everything from proper inventory control to how you have your stock organized determines how smoothly your warehouse functions. Even if you think your facility operates well, you can always improve, especially if you have aspirations of growth. By implementing the following ideas, you can make the most of the space you have.

Warehouse Organization Ideas

Organizing your warehouse is the foremost step toward improving your operations. Through effective warehouse design, your workers will spend less time picking or storing products. A well-organized facility also makes integrating software use into your processes more manageable. From optimizing layout to improving your receiving, you have numerous ways to get the most exceptional efficiency from your facility, regardless of the physical space you have.

1. General Tips

When it comes to organizing your storage space, keep things as simple as possible by not having complex or confusing paths through your shelving. Marking out clear aisles for foot traffic and forklifts works well for preventing accidents in warehouses that use both.

Also, communicate to each employee about what their specific tasks entail. Try using two-way radios or cell phones to talk to your workers on the floor. By using real-time communications, you can direct your workers based on how your warehouse management system software guides them. Plus, using radios allows you to receive immediate feedback from your employees.

With communication, make it a two-way discussion. Ask your workers for ways you can help to make their tasks more straightforward and faster. Because they must execute the work, your workers are in the best position to give you ideas for simplifying your warehouse operations. While you do not have to accept all their proposals, open yourself to integrating some of them. Those who work on the floor of your warehouse provide you with a source of experience you can trust.

With communication also comes training. Keep all your workers updated on how to use any new equipment in your facility. Workers who know how to use scanners and pallet wrappers operate more efficiently than those who have to ask for help while doing their job. Keep records of any new information you introduce to bring new employees or those who have taken time off up to date.

Treat your warehouse as an individual operation. Each facility acts as a tool that must fit a given purpose. Because each warehouse has unique uses and stores different goods, you may not need to use all of these organization ideas in your facility. Find ways to prime your warehouse to be a useful tool in your supply chain, such as improving the layout, making your storage more efficient and speeding up picking and receiving.

2. Warehouse Layout Optimization

Optimizing your warehouse’s design lies at the heart of having a smoothly functioning facility. You need to make your facility comfortable and safe for all workers to move around. Clear directions mean mistakes and wasted time are less likely to happen.

When improving your layout, think about your product positions and how to communicate to workers where the goods are. Use information labels on the products that include a photo of what the box holds. Photographs make it easier for workers to identify box contents without reading the smaller wording on all labels. You might also consider adding photographs of items to the ends of the aisles they are located to show workers where you store categories of products. 

For optimal warehouse layout, you will want to evaluate how you pull products as well. For goods that are frequently sold together, store them near each other on your shelves. Your workers will need to spend less time walking between the items to pull them for orders. You may also want to keep best-selling products closer to the front and seasonal items near the back or at the tops of shelves. Store heavy items closer to the ground to avoid injuries and make picking them more manageable.

When you make decisions on your warehouse’s layout, use information from your operation over several years. By evaluating long-term data, you can identify trends that will help you to predict when certain products become popular or which goods fall out of favor. Looking at data from several years eliminates temporary surges to give you a big picture of which sales happen and when. Using this information for organizing your facility’s layout will ensure you stay ready for changes that typically occur throughout the year.

Regardless of what you need to do to make your facility more organized, the layout should minimize the number of steps your employees take for each order. Fewer steps reduce their effort and physical pain while speeding up the rate at which your facility fulfills orders.

3. Storage Solutions

Instead of eliminating aisles to increase the number of racks you use, make your storage space smarter. Use racks that stack goods higher and retrieve items with forklifts or automated retrieval systems. By using the vertical space in your warehouse, you can store more without taking up additional floor space or sacrificing aisle space.

If you cannot use vertical space, consider mobile shelving. Store goods that you only sell seasonally on these shelves and push them together. In terms of floor space used, you can increase your storage space by 50% by hiding seasonal goods between shelves. When you do need the products, move the mobile racks out for access.

For storage, choose durable shelving that will not break under the weight of your products. Always use racks that accommodate more than you need to avoid severe accidents from shelving failures.

If you need to store small items, use stacking bins on your shelves. These bins accommodate smaller products that do not take up an entire box while still keeping things organized vertically.

Regardless of the ways you choose to store your products, keep inventory numbers accurate. Additionally, you must maintain updated maps of your warehouse to ensure workers always know where to go. If you use pictures on aisles or boxes, update those images when you move goods or if the products change their appearances.

4. Picking

While the layout and organization of your warehouse help to reduce the time workers take to get to the appropriate area for pulling products, you still can do things to improve accuracy.

If your facility does not already use wearable or handheld scanning devices such as barcode or QR code readers, start integrating them into your operations. By alerting workers who scan the wrong item, these devices can prevent errors in picking. Product mistakes reduce your customers’ satisfaction if the incorrect goods go out of your facility. Should a worker notice the error before shipping, your facility loses productivity from the extra time required to replace the incorrect product and pull the correct one.

To ensure your workers have everything they need when they need it, keep all picking equipment well maintained. Everything from wrapping machines to conveyors to pallets to forklifts needs regular evaluations and care. A breakdown steals time and money from your operations. Schedule frequent checks of all picking equipment and encourage workers to report any problems immediately.

Another way to improve picking is to cut down on the number of shipping containers you use. Instead of storing a large variety of box shapes and sizes, pare down your inventory of containers to two or three standard sizes. Workers will spend less time when picking and packing products to choose the right box for the order.

Lastly, use well-organized pick lists. Workers should move in a logical pattern through the warehouse to fulfill orders. If you have conveyors in your facility, have workers operating in different zones fill the containers with items from their area.

Without conveyors, give workers lists that have them move in a line to pick up items. An employee should not go to the back of the warehouse to get the first item, to the front for the second item and back to the rear for the third item. Organize lists so that workers pick up everything they need from each area of the warehouse they pass. Such logical pick lists will make their jobs easier and faster by minimizing unnecessary movement.

5. Receiving

While picking and shipping will take up considerable space in your facility, allot enough warehouse space to give your receiving personnel the room they need to work.

In the receiving area of your facility, workers can organize products based on where to shelve them. However, there needs to be enough space to allow workers to temporarily store those goods until they can put them where they need to go. Additionally, when there is ample space in the receiving area, workers will have room to scan new products into the inventory control system.

Giving receiving employees the space they need to work well and ensure the accuracy of incoming inventory keeps your records updated. Also, the sooner workers can input goods into the catalog, the faster your workers can shelve them for future picking.

6. Review

Even if you make drastic changes to your warehouse layout and organization, you will not complete the process. Organizing should become a permanent state in which you continually seek to make improvements in efficiency and productivity.

Never stop improving your warehouse because your business will change throughout the years. To allow for your growing business’s changes, make your warehouse adaptable to such alterations. Purchase shelving that will allow for future expansion. Also, make frequent changes during slower times to keep your inventory stored efficiently.

For example, you should store the best selling items closer to your shipping dock. However, this selection may change based on seasons. You may need to occasionally shift your stock to ensure your facility remains at its peak productivity.

Common Questions

Even with these tips, you may still have questions about warehouse layout and organization. Concerns about why these aspects of warehouse management contribute so critically to your operations are among the topics covered in these frequently asked questions.

1. Why Is It Important to Keep the Warehouse or Storage Areas Clean and Organized?

A clean, organized warehouse offers a safer, more productive environment for your workers. Instead of tripping over debris or wasting time moving boxes out of their way, workers can concentrate on getting stock pulled or stored.

While avoiding accidents and wasted time is one reason to keep your warehouse clean, you should also do it for your workers’ health and safety. According to the Occupational Health and Safety Administration (OSHA), you can prevent several hazards around your warehouse by changing your organization methods. For example, instead of triple slotting products on low racks to maximize space, use full slotting to reduce the chances of workers injuring themselves when pulling out goods.

Another way that organization helps is through preventing traffic jams. For example, if you have several workers trying to pull products from the same area of racking, someone may have to physically carry a product to a pallet. While moving the product may save time, it could cause the worker to pull a muscle. Instead, adopt wide aisles to allow workers to pass each other. Also, stagger schedules of product pickers to keep groups of them from congregating around the same racks.

When you adopt obvious storage spaces and aisles, your workers can move quickly through your facility without wasting steps or time to get to the products they need for order fulfillment.

2. What Is a Warehouse Layout?

Warehouse layout refers to how you have your racks and the space between them organized. Your arrangement should streamline picking and packing efforts to make them as smooth and accurate as possible.

You need to plan your warehouse design so that you can get people and equipment down aisles safely without compromising the usable space. A well-planned layout ensures high productivity levels because the goods you need most are where workers can reach them quickly.

Before moving racks around your facility, map out your layout on a software program to see how you can store everything you currently have while allowing for access and future growth. Your warehouse setup should function for your operations today and last for years of company changes in the future. An adaptable design allows you to use the most of your real estate without restricting your services, profits or potential for expanding to more offerings.

The layout does not only include the top-down view. Consider how you will use the vertical space in your facility. Rarely used products at the tops of shelves allow you to build up instead of buying more property to expand your warehouse’s floor space. A well-planned layout will save you money by making your space efficient and helping your workers to become more productive.

3. Why Is the Layout of Warehouses Important?

How you have your warehouse arranged determines how quickly your workers can retrieve orders and stock products. The faster that they can carry out these tasks, the better your facility operates.

When you have a well laid out warehouse, your workers are safer. With clear paths and excellent visibility, the risk of accidents involving workers or vehicles lessens. A safety breach will stop work, cause lost employee time and lower productivity. Anytime you can make your warehouse safer, you prevent these effects of safety incidents.

Having the right warehouse layout from the beginning is crucial if you want to save time and be more efficient. If you do not regularly monitor the design of your warehouse as you expand, your facility can quickly become challenging to work in.

Too often, companies neglect their warehouse organization in favor of expansion or increasing sales. As you grow, you want to put just as much care into your storage practices and warehouse layout. An efficient warehouse will make future development possible. Your workers will also have better productivity as they move through a well-organized facility to keep up with an increasing number of orders.

Using space poorly costs your facility just as much in efficiency as if you lack adequate room. If you have a good organization of products and a clear layout of your racks, your warehouse more quickly processes incoming and outgoing goods. Additionally, a productive plan increases customer satisfaction and helps improve worker morale.

4. What Are Warehouse Management Software Systems?

Warehouse management system (WMS) software helps you to regulate the movement and numbers of inventory and people in your facility. With this solution, you can improve how well you use your warehouse space and the time you have your employees working.

One way this software helps is through inventory control. You will know exactly how much you have of an item with 99% accuracy when using WMS software. That rate surpasses the guessing many facilities do between annual inventory counts.

When you use software to track and organize inventory, you reduce the chances of human errors that can cost you money in lost products. The software also helps you to make your operations more efficient by guiding your employees’ movements throughout the facility to take the most direct paths and get products in less time.

If you have plans to upgrade your warehouse to accommodate automation, having a WMS software in place will help you to make the transition. With its data on your warehouse layout and inventory, the WMS will communicate with any automated machines you use.

5. What Are the Benefits of an Organized Warehouse?

An organized warehouse makes pulling materials faster because workers will not be delayed when finding products. They can fulfill orders quicker and more efficiently by knowing where to go for the goods they need to retrieve.

When you integrate WMS programs in your organization, you benefit from being better able to track stock, locate products, avoid having too much of an item and see an immediate count of your inventory.

To ensure you get the most from your software, choose a product that meets your needs in increasing efficiency. With a 14% increase in productivity and a 50% drop in receiving time, your business cannot afford to bypass using FDM4’s WMS software in your facility.

The software also helps in your warehouse’s logistics as well as those outside your facility. By using route optimization, your workers pull products faster, and trucks arrive in the most efficient way possible. With lower shipping times, you also cut your delivery costs.

Keep your facility operating like a well-oiled machine instead of a system of barely controlled chaos. WMS software and organizing your inventory are the keys to upgrading your facility’s efficiency and productivity.

Learn More About FDM4’s Warehouse Solutions