It may seem odd to think about the holiday season during the heat of summer. But anyone working in retail or order fulfillment knows that the busy season is just around the corner. And those who are best prepared for the holiday rush and the logistical challenges it presents can reap the greatest rewards.
It’s been an unprecedented and unique couple of years for eCommerce businesses, particularly third-party logistics (3PL) warehouses. With the pandemic driving changes in consumer buying patterns, online activity has skyrocketed. In 2020 alone, U.S. consumers spent an estimated $861 billion in eCommerce, representing an incredible 44% increase from the prior year.
But warehouse space doesn’t come cheap. Considering the total cost of storage, labor, materials handling, and occupancy, fulfillment can account for as much as 20% of an order. Making the best use of the space and labor you have is generally preferable to adding additional space and hours to the mix. So, as you get ready for peak season, here are some of the ways you can increase your existing warehouse space.
1. Assess Current Warehouse Layout
Making changes will be challenging if you don’t take the time to take a close look at your current systems first. Here are a few things you may wish to examine:
Space Utilization
There’s a common saying in warehousing that goes something like, “If there is space available, someone will eventually fill it.” So, it’s not uncommon for a warehouse to be completely full, even in the slowest periods.
Space deficiencies can occur for any number of reasons, such as having too much inventory or poor use of existing warehouse storage. Look at your space utilization with a critical eye to see if there is room for improvement.
Inventory Placement
You also need to decide if your current inventory is being placed in a way that easily accessible. If you’re going to be bringing in different types of stock or greater numbers during peak season, how will you place the most in-demand items so that you can access them more efficiently?
Traffic Flow
Finally, you’ll want to make sure there is enough room in your warehouse’s shipping and receiving areas, as well as plenty of space to walk through the aisles and use the required equipment. Not only do you want to create an efficient flow of stock but also ensure the safety of your staff.
2. Project Upcoming Warehouse Needs
No one could have anticipated the jump in online activity over the past several years. But, your needs going forward should be a bit more predictable. Consult with your sales and marketing team to get the latest projections relative to sales and even timing. When do you expect inventory to start arriving? How quickly will the inventory turn over?
3. Improve Your Warehouse Storage Capacity
Poorly utilized warehouse space is a common condition that is caused by a number of factors, including steady growth, changes in storage requirements, and increases in service requirements. What many warehouse operations fail to recognize is that they have opportunities to find more space by reassessing their systems and improving internal warehouse design. Here are some of the ways you can address warehouse space management:
Use Your Vertical Space
Look up and see how much space you still have to capture. Vertical space is one of the most under-utilized storage areas in a warehouse. You can free up a ton of floor space by stacking items to near-ceiling height. Keep seasonal and overstock items at the top and high turnover items within easy reach.
Consolidate Pallets
You can free up space by merging items together from several partially empty pallets. Stack and store these consolidated items out of the way to get more floor or shelf space.
Utilize Containers
If you receive unpackaged items in your warehouse, the best solution is to keep them consolidated in containers that are simple to stack and store with a pallet racking system.
Reduce Aisle Widths
How wide are your current aisles? See if you can redesign them to the minimum width needed to support your material handling equipment without compromising safety or efficiency.
Right-Size Your Slots
Match the sales and size of each item to the optimum sized pick slot. This not only ensures proper product handling but can also give you more room by reducing wasted space.
Install a Mezzanine
If you have the right layout, see if you can install a mezzanine to support functions that don’t require high-bay storage. This is a costly upgrade, but it will help you maximize your storage space.
Don’t Forget Storage Depth
Using all of the height in your warehouse available is vital, but don’t forget about the depth of your storage. Specifically, consider using double-depth racking to gain more space.
Get the Right Process Flow
Look at the entire layout of your warehouse to ensure you aren’t wasting space with inefficiencies. Are you minimizing the space you use for supply storage? Is it possible to combine your shipping and receiving docks to save space without sacrificing efficiency?
4. Use the Right Equipment and Technology
Once you’ve addressed how to maximize your warehouse space during peak season, you’re ready to take a look at some of the other ways you can make your operations more efficient during what promises to be a busy time.
Service and Repair Existing Equipment
You can’t afford unexpected downtime during a busy peak season. One way to minimize the risk of this happening is to conduct preventative maintenance on your materials handling equipment regularly and well before the busy season arrives.
Consider Upgrading Your Equipment
You might also want to consider any potential upgrades to your equipment. (Just make sure new equipment isn’t delivered or being put online during your busiest time). Some of the equipment that could make your warehouse more efficient includes:
- Loading and storage equipment - Equipment like pallet dispensers and stackable pallets can help improve your loading and storage efficiency.
- Pallet management equipment - Pallet exchangers and inverters can help you save time by safely turning, tilting, and moving pallets.
- Workstation equipment - Loaders and lift tables can increase productivity and improve safety.
Leverage Warehouse Technology
As you prepare your warehouse for the holidays, you may also wish to take a look at the ways technology can improve the efficiency of your operations.
- Paperless functionality - Paperless workflows using mobile carts and barcode scanning can improve picking and packing functionality and reduce wasted space.
- Automated billing - Particularly during peak season, having automation for billing and payments can help warehouses more effectively receive, store, and deliver orders.
- Offer visibility - Warehouse staff can save valuable time when you offer customers complete visibility across your operations.
It’s About More Than Just the Short-Term
Once the peak season is over, your business can get back to normal. But, what is “normal” anymore when it comes to consumer behavior and shopping seasons? With the rise of eCommerce in recent years, there are now multiple annual shopping seasons that revolve around back-to-school, Valentine’s Day, Mother’s Day, and other major tick marks on the calendar.
Warehouses that take steps to optimize for any and all surges will remain successful, whether they are supporting the needs of individual or business customers. Your warehouse can continue to meet the demands of its customers by leveraging technology and improving its warehouse space management strategies.
