Shipping costs are such an important aspect in purchasing decisions that 66% of buyers seek up an online retailer’s free shipping requirements before adding a single item to their shopping carts. Thirty-nine percent (39%) of consumers expect free two-day shipping, and 29 percent have backed out of completing an online purchase because two-day shipping was not free.
Optimizing warehouse logistics is one of the most effective strategies to cut shipping costs and assure timely delivery. Excellent warehouse logistics may provide a major competitive advantage in many ways. This is a guide on how to improve warehouse logistics planning and the benefits. We’ll also look at the salary of the warehouse logistics manager salary in 2022.
What is Warehouse Logistics?
To define warehouse logistics, we must first comprehend the concept of logistics. Logistics, in its most basic form, can be defined as the precise planning, organization, administration, and execution of complex processes. Logistics include the flow of both physical items and information in various businesses, including warehousing.
Warehouse logistics, as a result, incorporates all of the various, complicated variables involved in warehousing, including organization, movement, and management. This involves the movement of physical inventory (shipping and receiving) as well as more abstract goods such as information and time.
Warehouse logistics might also include warehouse pest control, damaged goods handling, safety standards, human resource management, and customer returns. Warehouse logistics, in other words, encompasses all of the policies, processes, and organizational tools required to keep your warehouse operations running efficiently.
Before you start building your warehouse, make the following preparations:
- Choose the best location for your warehouse based on transportation costs and high-demand locations.
- Make sure you have enough money to build up the warehouse.
- Optimize your floor design to maximize storage space, reduce accidents, and perform efficiently. It’s a good idea, for example, to locate the loading and unloading port near the road.
- Professionals should be hired to manage warehouse tasks.
- Choose the appropriate warehouse equipment and machinery.
Following the installation of your warehouse:
- Calculate and plan for daily operational expenses.
- Analyze product trends and forecasts to ensure that you are ready for client demand.
- Choose the best warehouse management software for your needs.
- Create a suitable approach for dealing with defective products and consumer returns.
- Protect your items by implementing pest control techniques.
- Implement a safety policy to help prevent accidents, and be prepared if something goes wrong.
Warehouse Logistics Difficulties
The following are some of the most common warehouse logistics challenges: Simply put, how do you obtain detailed control over a big object like a warehouse?
Nonetheless, you must. You must be able to specify the exact position of a certain item of inventory, the pallet that allegedly included an expired food item, or the truck that conveyed an item that was damaged during transportation. These controls are critical for smooth operations and healthy earnings, but they are practically difficult to execute without expert tools.
Warehouse issues go beyond these immediate problems, encompassing inventory management, supply chain management, cost controls, human resources, risk management, and security, among others. So, how do you acquire enough flexibility to remain competitive while retaining adequate offers to satisfy clients and implementing sufficient controls to secure your revenues? These are the issues that warehouses are dealing with nowadays.
How to Make Warehouse Logistics Better
It goes without saying that warehouse managers have a lot on their plates. Fortunately, you also have an expanding number of helpful, highly powerful tools to assist you in meeting the needs of your warehouse, the needs of your staff, and the expectations of your customers.
Advanced warehouse management systems (WMS) provide you with real-time visibility into your warehouse and provide you – and all of your staff – with the tools you need to run your warehouse successfully, efficiently, and profitably.
Indeed, a warehouse management system (WMS) is not only a definite approach to improving warehouse logistics, but it is also a necessity in today’s warehousing. Warehouse management systems are more than just inventory control systems; they manage all aspects of warehouse logistics, from inventory control and administration to order fulfillment. Many WMS systems now include mobile tools, allowing warehouse managers and personnel to check the system while on the road, using a smartphone.
Comprehensive WMS also combines traditional management tools with warehouse control systems (WCS) to create a whole-warehouse synergy that improves your whole logistics, from inventory receipt to shipping.
The Advantages of Warehouse Logistics
The advantage of managed warehouse logistics is straightforward: increased income.
Consider this: When your warehouse operations run smoothly, inventory is properly accounted for, the right item is sent at the right time, the stock is replenished when needed, fewer picking errors occur, and all people, processes, and systems work as they should, your warehouse operates more efficiently. There are fewer errors and difficulties, which implies more revenue.
When you employ a solid WMS to manage your warehouse logistics, you can:
- Maintain precisely, real-time inventory counts: Know how much inventory you have – and where it is in your warehouse.
- Reduce returns: Having a precise inventory means sending the correct item the first time.
- Auto-replenish stock: Instead of waiting until you’re out (or almost out) of stock to purchase more, have your WMS auto-replenish inventory when stock levels fall below a certain threshold.
- Maximize warehouse space: Some WMS automate warehouse processes (for example, stock rotation and picking), which means you’ll require less floor space for workers, allowing you to maximize warehouse space to store more goods.
Other WMS advantages include better demand planning, increased visibility and transparency, stock traceability, fewer picking errors, optimized processes, effective labor allocation, and improved customer service – all of which result in lower operational costs and increased income.
Creating a Warehouse Logistics Plan
Before you begin, it is always a good idea to have a solid plan in place. It is impossible to determine whether you met your targets unless you have a plan that includes clear business objectives and a route for reaching them.
#1. Obtaining prerequisites
First, determine the warehouse requirements of the company. Some questions must be answered in order to establish the warehouse requirements, such as:
- Who are your clients?
- Where can I find them?
- What is the current solution that is being used?
- How big is the order volume?
- What is the existing solution’s cost?
- What are the existing solution’s delivery times?
- Will the new warehouse result in cost savings?
- What is the implementation timeline?
- What kind of operating efficiency do you want from a new warehouse?
These are some of the questions that must be addressed before making the final choice to build a new warehouse. Other inquiries and considerations may arise as a result of your company’s unique business requirements.
This step assists you in precisely defining the needs, requirements, benefits, and implementation timeline. You must estimate the cost of operations, which includes all aspects of warehouse operation, the cost or time savings realized by investing in a new warehouse, and the project’s break-even threshold.
It is likely that the results of this research will not support the establishment of a dedicated warehouse. Working with a reputable third-party logistics provider may be a better fit in this scenario. Top third-party logistics providers have spent years optimizing their processes, allowing businesses to tap into their expertise and achieve optimal performance at a lower cost than maintaining in-house warehouse and logistics operations. Alternatively, by installing flexible automation systems, you may be able to extend the lifespan of your warehouse.
#2. Determining a location
After determining the requirement for a warehouse, you must choose an appropriate location. The answers you provided throughout the requirements gathering step will be useful here. It is simple to select the optimal warehouse location to serve your clients once you know where they are. Keep in mind that serving some clients is typically more profitable than serving others, so you may want to prioritize the demands of the customers who provide the most income for your company. For example, you might select a location based on its accessibility to your best or longest-term consumers, allowing you to deliver goods to those customers more quickly than to short-term or infrequent customers. Geographic Information Systems (GIS)-based tools are available to help you find the ideal location for your warehouse.
Another element to consider is whether you are constructing a new warehouse from scratch, adapting an existing warehouse, or renovating another facility to serve as a warehouse. All of this boils down to your warehousing needs and budget constraints. You should also consult with your company’s finance department to determine the most cost-effective approach. Purchasing, renting, and leasing all have various balance-sheet ramifications, and the finance department is better positioned to determine what is best for the company’s long-term financial health. At the same time, your warehousing needs should not be jeopardized. Meeting both financial and logistical goals at the same time is a difficult balancing act that necessitates transparency and open communication across multiple departments.
#3. The layout of your warehouse
Mapping a warehouse is a necessary step in establishing what goes where and how activities are handled. Order picking is the most labor-intensive process in a warehouse, accounting for up to 55% of warehouse operating costs, and mapping your warehouse can help to streamline this critical business function. The warehouse mapping procedure consists of the following steps:
- Examining the available space
- Labeling the area (including aisles, racks, shelves, containers or bins, etc.)
- Traffic forecasting
- Choosing the Best Racking System
- Choosing the best order picking carts to fulfill the needs of the warehouse
- Putting inventory management software in place
Mapping your warehouse is an important process that should not be overlooked. Your logistics business will be chaotic if you do not have a well-mapped warehouse to work from.
Warehouse Logistics Operations
After creating a solid plan, you must put it into action. You must hire staff, set up a management structure, link the warehouse with the rest of the supply chain, and ramp up operations to full capacity. If you are transitioning from a current solution with a third-party logistics provider to a dedicated warehouse, you must slowly and gradually divorce from the existing service provider.
Regardless of how solid your warehousing strategy is, you should not rule out the chance of disruptions. Should a disruption occur soon after operations begin, the existing service provider can serve as a backup plan. We’ll look at the essential aspects of ensuring smooth warehouse logistics operations in the sections below.
#1. A Capable Warehouse Logistics Manager
Although it may seem obvious, some supply chain inefficiencies can be traced back to inept warehouse management. When considering warehouse management prospects, demonstrated proficiency in a candidate’s previous work is arguably the most significant factor to evaluate, while years of experience should not be overlooked. The warehouse manager should be well-versed in the intricacies of the facility and location. They should also be well-versed in the specialized equipment and procedures that enable streamlined and effective warehouse operations. Because a considerable proportion of problems that develop in a warehouse are people-related, highly skilled warehouse managers must also have great interpersonal skills.
#2. Clear Objectives and Future Plans
Everyone in the warehouse must be aware of the operational goals. Employees should not feel as if they are executing mundane activities in exchange for a salary, but rather as if they are contributing to a wider strategy to enhance the organization. Employees should feel appreciated and important in helping the organization achieve its goals.
#3. Technology and development
Adopting new technologies without first analyzing whether they assist your processes can be costly and inefficient. When technology is used in accordance with the goals and requirements of the business, it can enhance productivity and even employee morale by making the duties of your warehouse associates easier. Today, it is impossible to run a warehouse using only what is stored in warehouse managers’ heads or spreadsheets. In the market, there are specialized software solutions for any requirement. Investing time in researching and evaluating technological solutions to find the best solutions for the company’s needs is time well spent.
#4. Employee contentment
Employees are critical to warehouse operations. Because labor accounts for roughly 65 percent of warehouse operating costs, it is critical that your employees perform to the best of their abilities. Your staff should accept your company’s vision totally and strive for the future, but your company’s goal and vision must be something your employees can get behind.
In this regard, the manager you hire is critical. Employees prefer to deal with a manager who can relate with them rather than a phantom managerial department. As a result, it is critical to employ a manager who is capable of managing people and their expectations.
Warehouse Logistics Manager Salary in the United States
The typical salary of a Warehouse logistics manager ranges from $36,000 to $79,382 per year for Forklift managers and Plant Managers. Warehouse Logistics’ weekly compensation ranges from roughly $592 for Freight Handler to $1,342 for Owner Operator Driver.
The warehouse logistics manager salary data is derived from 77 data points gathered directly from employees, users, and historical and present job adverts on Indeed during the last 36 months.
Please keep in mind that the warehouse logistics manager salary data are estimates based on third-party submissions to Indeed. These numbers are provided to Indeed users solely for the purpose of broad comparison. The minimum pay varies by jurisdiction, therefore you should check with your company for exact warehouse logistics manager salary figures.
Conclusion
It is ethical to attempt to provide high-quality products at the lowest feasible cost to your clients. Warehouse logistics is a critical component in this. Improved logistics translates to a more efficient supply chain and cheaper expenses for you and your customers. Make a list of the problems that are affecting your warehouse operations and devise a strategy to handle them efficiently. Using a WMS to monitor these processes and aggregate data in one location is one approach to tackling your specific warehouse logistics concerns.
Warehouse Logistics FAQs
What are 3 key parts of warehousing logistics?
Warehouse management, warehouse management systems, and warehousing services or operations are the three main components of warehousing.
What is the difference between logistics and warehouse management?
The logistic management process comprises arranging and performing operations as well as transferring and storing items from one site to another. Unloading, receiving, storing, checking, and distributing items or products are all part of the warehouse management process.
How do warehouses work?
Receiving, putaway, storage, picking, packing, and shipping are the six basic warehouse procedures. By optimizing these six procedures, you will be able to streamline your warehouse operation, cut costs and errors, and achieve a greater flawless order rate.
