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   Establish Home > Warehouses struggle to keep up as the economy changes





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Warehouses struggle to keep up as the economy changes.

As we start 2008, the most common problems reported by warehouse managers include producing results with a reduced workforce, coping with a non-optimal physical layout and structure, maintaining the measurements needed, and just plain management of a highly variable workload.

The cuts in staff and expenses of the past few years have now come home to roost. With volumes and demands fluctuating both upward and downward, warehouses now must be properly staffed, organized and automated to handle today's activities - particularly the ever increasing requirements for Value Added Services. And while increasing headcount is never a popular subject, there are times when it makes sense to staff properly and avoid late shipments and errors due to inadequate work force levels and fatigue.

The physical layouts tolerated during the early years of this decade in many warehouses are just not adequate for the current volumes and special activities required of most operations. Many companies put off making the changes in racking, aisles, staging areas, scales, wrapping equipment, and packing areas that needed to be made and "made do" with what they had. Now as volumes increase, it's time to get that warehouse laid out properly to be able to handle the volume and the labeling, re-working, tagging, counting, kitting, display assembly, and pallet configuration that today's customers require.

Having the right metrics for optimum warehouse operation is key to being able to justify the increases in headcount and the changes in layout that may be needed. Most operations track service performance (orders, lines, errors, cases, and pallets). But do you have metrics that cover productivity performance and capacity utilization? These measurements will help identify the need for changes and the potential savings in the operation.

For some companies it's now time to identify the need for a new warehouse. Not only because of the potential improvements in operating costs of having a proper warehouse, or because the lease is finally coming to an end and it's time to lock in a good rate and a building capable of handling the two- to five-year forecast, but also because one of those product lines or geographic market areas needs a boost in service to enable the company to grab that increase in market share so needed to reverse the downward trend.

As we move into the later half of this decade (that's right, its downhill from here on) it may be time to re-evaluate the ability of the company's warehouse facilities and operations to make sure they are ready to support the business strategies.

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