The Right Stuff

May 1, 2005
Spring cleaning sets a precedent for freeing up space in the warehouse.

How much of this stuff one actually needs is generally not a debate you want to get into with your spouse and children, not at least for those who value familial harmony. There are bigger issues to expend our energy on. It's not a debate most warehouse managers want to get into either. Life is just easier if you keep your head down, maintain the status quo and stay focused on putting material away and getting today's orders out the door.

There comes a time however when you have to weave around piles of things to get to the other side of the garage, when warehouse productivity suffers from long travel times between pick points and poor inventory inaccuracy, when it's time to rein in the disorder. Inspired by such efforts, here are three of the fundamental methods to increase your warehouse storage capacity when you think you've run out of space.

Get rid of excess and dead inventory. The popular metaphor for what happens when you lower inventory levels is that it's like lowering the water in a pond and exposing the rocks. Less safety stock exposes the trouble spots in your fulfillment processes that inventory can smooth over.

I liken it to the back seat of my truck. Over time the seat fills up with school papers, action figures, magazines, broken crayons, maps and water bottles. Putting this stuff away a few weeks ago—on an unoccupied shelf in the garage—revealed a half-full sleeve of McDonald's French fries. Although they still looked perfectly edible, I threw them out before a young boy's curiosity and hunger could get the better of him.

Most storage levels are set by rules of thumb and long-forgotten sales projections. Reallocate inventory levels, order quantities and packaging to match today's customer demand patterns.

Fill in the storage gaps. Closets in almost every house come with a standard shelf and rod for hangers. Custom closet designers know how inefficient such a setup is. They can double the effective storage space by reconfiguring the rods and adding bins and shelves to match the unique mix of an individual's wardrobe. It's no different in the warehouse. From time to time you have to adjust your rack heights and other storage clearances to match today's product mix. Simply putting items closer together can open up space.

A material-handling engineer at a paper products company told me recently that he had reduced the amount of space between unit loads from 10 inches on each side, a standard established when they had plenty of space, down to five inches. Multiplied across all of the available floor and rack space in his facility, this simple policy change freed up a large chunk of storage. As a bonus the clearance constriction reduced product damage from sloppy handling because lift-truck drivers had to slow down.

Segregate fast-and slow movers. When the holidays are over you take the decorations down, put them in a box and store them away. With the arrival of spring—at long last in many parts of the country this year—winter coats and boots can finally be moved out of the front closet. You know you won't need them again for five, six months if we're lucky.

Successful warehouse managers live in a perpetual spring. They are constantly analyzing their material velocity to find out what's hot and what's not. This is accomplished through a variety of slotting tactics, or simply assigning faster-and slower-moving items and pallets to A, B or C zones. It's surprising how many site managers do not use the order line pick frequency data that's available to them to separate fast-and slow movers.

Granted, these are some of the most basic initiatives warehouse managers can make to free up space. But it's the basics that can get away from us and make us start thinking about much more capital-intensive solutions, such as buying a bigger house, or moving into a larger warehouse. Remember, more space just collects more stuff.