Manual Stock Locator System

By Don Benson, Warehouse Coach

Often long before they can afford to implement a warehouse management system, many warehouses have had to develop forward picking locations and then create and implement an effective method to replenish pick position locations from back stock. They need a method that is simple to use, does not rely on staff to remember where they put an item or last saw an item, provides backup when material gets lost, and generally provides a sense of control and order to daily warehouse operation. Many years ago, as we were first developing warehouse management systems, I discovered a company that had developed a stock locator tag to manage storage locations and direct movement of merchandise between locations, including replenishment. I have seen this method used effectively in many warehouses. In this column I will describe the method, the stock locator tags, and how to use them.

The manual stock locator system was developed to

• Record the putaway location of receipts;

• Make the putaway location information available to aid in retrieving stored merchandise (replenishment to forward pick position or picking full palletloads for orders);

• Make stored merchandise easier to identify;

• Support the finding and assigning of locations to store receipts.

This stock locator system assumes that pick (or forward) locations are permanently assigned and that all other locations get filled as needed, and when empty become available for another, different SKU.

The primary tool for this system is the stock locator tag.

Receipt storage procedure

Maintain a file for stock locator tags at the receiving dock. When a “Reserve Location” becomes empty, create a new stock locator tag identifying the location as available for future use. File the new tags either by location number or by location number grouped by location size or capacity (e.g., small, medium, pallet rack, floor storage, etc.) in an empty locations file at the receiving dock.

As a first step in the receiving/putaway process, the receiving clerk should look at the receipt and determine what size location will be required to store the cube of the SKU receipt. Then the clerk should select the stock locator tags for the appropriate size locations from the empty locations file; fill in the information in the blanks on the selected tags describing the merchandise, one tag per palletload, or one tag per case if the receipt is small. After entering the SKU number, the number of cases on the pallet, the date, etc., the clerk should attach the tag to the merchandise to signal the load is ready for storage.

For receipts with more than one palletload per SKU, one stock locator tag should be obtained and completed for each palletload of a SKU to be stored.

The putaway operator will take a palletload of merchandise with a tag attached, and store it into the location noted on the tag. Before placing the load into the storage location, the operator will:

• Initial the tag;

• Remove the second and third copies;

• Attach the second copy to the load so that it can be seen from the aisle after being stored.

The operator will then:

• Place the first copy (card stock) into a storage envelope at the permanently assigned pick position;

• Return the third copy for filing by SKU number in the receiving office.

The putaway of small numbers of cases in hand stack locations should use the same procedure except that the first (hard) copy should be attached to one of the cases as it is stored so long as all the cases are stored together. If the cases are stored in several locations, one tag should be used to record the storage for each location.

Pick position replenishment

When a pick position is emptied, or needs replenishment, the person with the responsibility for that merchandise movement will:

• Remove the tags from the storage envelope at the pick position, select the tag with the oldest date, replacing the remaining tags in the storage envelope;

• Go to the reserve location noted on the tag;

• Verify the merchandise is correct by confirming the serial number on the tag copy on the merchandise as the same number on the tag copy obtained at the pick position;

• Remove all or part of the merchandise (as required) out of the reserve storage location,

If all the merchandise is moved to the pick position, remove the tag copy from the merchandise and return both copies of the tag to the receiving office. At that point all three copies from the original tag will be matched and destroyed, and a new stock tag created to indicate the reserve storage location is available for the next receipt.

If only a portion of the merchandise in the reserve location is removed, change the number of cases noted on both the first and second copies of the tag to the case amount remaining in the reserve location and return both tags to their original locations.

* Move the merchandise to be replenished to the pick position.

Finding reserve inventory

If stock locator tags stored in the envelopes at the pick position are lost or destroyed, reserve stock can still be located using the third copies of the tags kept in the receiving office file. Similarly, if the stock locator tags on the merchandise in the reserve locations are missing, the third copies of the tags filed in the receiving office can be examined to determine the identification of the merchandise.

Inventory counting

By completing the stock locator tags and placing the second copies on the merchandise stored in reserve locations, identifying merchandise and verifying the identity and amount during the counting of inventory will be standardized and easier.

You can implement this stock locator system yourself, without the assistance of any other department in your company. The purchase cost is minimal. Of course, you need to have already implemented a location numbering system. I described this process in an earlier column you can find on the Affordable Change page at Implementing this manual stock locator system will substantially improve the productivity and quality performance of your warehouse.

Don Benson, P.E., has been consulting to retail, wholesale and manufacturing organizations for more than 25 years. His practice focuses on improving the effectiveness of warehouse and distribution operations. His office is in Oakland, California. He can be reached at [email protected] or 510-482-3436.

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