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Newcastle Systems in the News

Four Ways to Find Efficiencies in the Age of Amazon


In 2016, nearly half -- 43 percent -- of all online retail sales in the US went through Amazon, thus fueling industry demand for two-day shipping. This growth in e-commerce has contributed to an upsurge in the number of warehouses and daily volume. But to stand out in a crowded market and keep pace with the likes of Amazon, warehouses nationwide are aggressively seeking ways to reduce delivery times and find efficiencies in the small shipment process.

Through a few simple best practices, logistics professionals can speed up the receiving process, reduce wasted steps across the warehouse floor, and achieve dock-to-stock optimization:

  • Mobile Power Loss of productivity and inefficiencies such as wasted steps taken on the way to the printer on a fixed desk, inaccurate inventory counts, improper labeling, time delays, manual processing and incorrect shipments can all make life difficult for warehouse staff — most of whom are tightly focused on time studies.

With mobile-powered workstations, warehouse associates can process packages right on the receiving dock, saving countless steps throughout the day. It’s estimated each step costs the company three to four cents. You can figure out how much each step is costing your warehouse by using this basic online calculator. If you’re offloading 18 truckloads a day in a single facility, you can reduce processing time for each truck from 45 minutes to 30 minutes, resulting in a savings of about $22,000 a year, based on a total of 4.5 hours saved daily. These are important gains for companies operating in a world where e-tailers like Amazon are pushing the “next-day” and “two-day” envelope hard.

  • Inbound Freight Management - Inbound management is a vital step in the process of creating more time, but it’s often an overlooked step. Automating inbound management is a difficult task, but it is one that should be pursued as it can provide immense benefits. There are software options managers can buy to organization and automate their freight management. This software will also help DC managers prioritize the more important products and shipments that arrive, thus allowing for fast turnaround time to the outgoing trucks.
  • Radio Frequency (RF) – RF Scanning goes a long way to reduce waste in the warehouse. Wasted steps and wasted documents will all be decreased when RF scanning is implemented. This is a very important step for DC managers to improve efficiencies, and get packages to the consumer faster. The wireless technology creates more time for associates as the scanner is documenting all the information needed, thus freeing up associates to fine tune other warehouse tasks. RF scanning can be rolled out on a budget, but its implementation is vital in the ever-important task of creating more time for warehouse associates.
  • Stock Keeping Unit (SKU) Optimization PlanIn 2017, no product is too small in the world of parcel shipping. Items like toothbrushes, dish soap, and even small ziplock bags are ordered online. The emphasis on ordering nearly everything and anything online has greatly increased the number of SKUs a warehouse manager processes. A strong SKU optimization plan is essential to successfully maintain and organization the volume of parcel SKUs coming in, and most importantly going out. SKU optimization keeps your warehouse organized as it details which products shouldn’t be ordered as frequently and which items need to be highlighted or emphasized. There are specific software applications warehouse managers can implement to track inventory and get rid of the waste in their facilities. Information is key to reducing waste in the warehouse, and SKU optimization is a great way to have vital information right on hand.

In the new age of small package supply chain, speed is king. Warehouse managers are finding any tactics possible to speed up processes and get shipments out the door faster. Automation is no longer just for the largest and most powerful warehouses; all warehouses need to implement whatever measures their budget allows. Not all break the bank, and the four tactics above can fit any budget, particularly in the early stages of implementation.

A good first step is to enlist the services of a warehouse improvement consultant who will help develop a structured program to assess warehouse operations and apply proven lean manufacturing practices. Competition is fierce but with process improvements and automation best practices it will be easier to grab market share and give Amazon a run for its money.

Topics: Warehouse Management