How to Maximize Warehouse Space When Expansion Isn’t an Option

One old saying that goes in the working of the warehousing is that, ‘If there is available space in a warehouse, someone will eventually fill it.” Thus, it is not uncommon for the warehouses to be full even during the slow periods.

When does a warehouse run out of space?

A warehouse usually runs out of space because of:

  • Seasonal Peaks
  • Rapid Growth
  • Bulk Discount Buying
  • Planned inventory builds due to manufacturing shutdowns
  • Slow sales period
  • Facility Consolidation

Types of Space Deficiency in a warehouse

Largely, there are three key types of space deficiencies that are noted in a warehouse.

  • Holding too much of right inventory
  • Holding too much of wrong merchandise
  • Using the existing warehouse space ineffectively

In order to address these space issues, it is important for you to understand these issues and the reasons of such issues.

Holding too much of right inventory

When you have the right product in abundance, it appears healthy especially when it comes to customer service as well as order fulfillment goals since the product is always readily available to cater to the customer orders in time. Though the sales staff and the buyers feel happy on fulfilling every order timely however the warehouse tends to operate well below the established safety and productivity standards. So, when you look closely at such type of warehouse, it will reveal pallets of product stacked in dock areas and aisles. Moreover, there is multiple SKUs of product that is mixed in one single bin location. As a result of this, the visibility is blocked leading to lack of ease in finding the needed inventory, multiple handlings of the products, safety hazards as well as decreased labor productivity. Upside however is that such products move quickly across the warehouse and space problems are present just for few weeks.

Holding too much of wrong merchandise

Stocking up too much of a wrong merchandise is a clear proof of incorrect sales production and poor production planning. It also means that the warehouse is incapable of managing the inventory levels rightly. When the levels of right inventory are high it can be handled via extra labor but the wrong inventory only results in inventory lying uselessly in the warehouse for months and sometimes even years. Obsolete inventory often has little or no value in the open market however, the earlier you identify it the quicker it is for the company to cover up the losses and manage the assets.

Using the existing warehouse space ineffectively

Poorly utilized space is one common occurrence in almost every warehouse. It is non exclusive of the type of inventory or the storage conditions existing in the warehouse. Largely, the warehouses are built and equipped only to handle a certain amount of products and limited unit loads. Then with time the warehouses are expected to accommodate keeping pace with the customer demands without affecting the efficiency. This poses to be a problem that gets hard to tackle.

How to maximize the storage space when there is no room to expand?

1. Revamp Racks
When you are seeking space optimization, racking is the first thing to consider. However, before you opt for rack revamping, it is important to consider the idea that determines whether or not the attempt will be worth while or not. So, make a thorough note of pallet heights and every rack elevation. Ideally, the arrangement must have 4 inches to 6 inches of gap between the top of the pallet to the base area of the beam. In case, the racks have occupied a space more than that, then you have possibly found an opportunity for availing the additional space. Before opting for space revamp do consider the fire safety precautionary space, forklift’s operating height, etc.

2. Go vertical
You can maximize the warehouse space by raising the roof. Improvement of the height of the warehouse can definitely serve the purpose of space maximization. This will provide you with the additional levels of pallet storage. However, you must consider the engineering limitations to ensure that the additional height doesn’t become illegal.

3. Storage Space – (Excess + Unwanted) inventory = More Warehouse Space
Get rid of the excess of the right inventory as well as the wrong inventory so as to maximize the warehouse space. You can always order for products in batches so as to ensure that you don’t stock up the warehouse beyond what’s necessary.

4. Use of AS/RS Systems
Automated and Retrieval Systems include a series of mechanisms such as conveyors, lifters, etc. These systems tend to reduce the space that is occupied by aisles. This advantage of AS/RS makes it one of the most sought after idea for undertaking space maximization. There are certain downsides of AS/RS systems. Such systems are expensive and require immense care.

Final Say

You can use any one or a combination of these warehouse space optimization techniques to ensure that there is sufficient space in your warehouse.

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Shipping Terms

Are You Aware of These Shipping Terms? Part II

E-Commerce is fast gaining popularity due to its ease of shopping and shipping. Now consumers no longer have to invest long hours in shopping, as every item is easily available online, which they can compare and purchase. The process of shipping is intriguing and interesting. We had already discussed the part one of common shipping jargons that you should be aware of. Here is the second part on familiarizing with some more shipping terms.

ETA: Expected Time of Arrival (ETA) denotes the time of the shipping carriers reaching the destination of the receiver, which includes both merchants and clients. Merchants can pick their returned goods, while customers can receive their ordered items.

ETD: Expected Time of Departure (ETD) denotes the time of the aircraft takeoff or the ship’s sailing post stocking their freights.

Bill of Lading: The official contract on shipping is entered between the vendor and the carrier by the means of Bill of Lading. It indicates details on the terms and conditions for shipping the merchandise as agreed between the merchant and the shipping company. It also acts as a receipt for goods.

Freight Rates/ Base Rate: Courier companies charge a minimum rate for shipping, which is called Base Rate. This base rate is based on per kg or per 0.5 kg of the parcel. The price is independent of the current fuel charges, taxes, and the distance covered.

SKU: Stock Keeping Unit (SKU) denotes the identification code of an item for shipping via Airlines. The purpose of providing the unique identification number is to differentiate the product and its attributes from the rest of the stock. It may include other specifications too ,like size, brand, model, and color of the product.

Reverse Order Pickup: Reverse Order Pickup (ROP) indicates that the courier company needs to pick up previously placed order. ROP occurs due to a returned order by a dissatisfied customer. Upon requesting the order to be returned by the customer, merchant immediately relays the same information to the Courier Company.

Volumetric Weight: The volumetric weight is calculated according to the volume of the cargo. Volumetric weight ensures suitable charges are applied based on the volume weight in case the actual weight is low. For example, cotton merchants pay a traffic based on the volumetric weight, as it is light in weight and does not occupy space.

Chargeable Weight: The chargeable weight is assessed by first calculating the volumetric weight and the actual weight. Chargeable weight is either of this weight, which is greater than the other. Thus, if the volumetric weight is more, it is counted as chargeable weight, and if actual weight is more it is said to be chargeable weight.

Missing Orders: If the product is untraceable due to reasons like wrong delivery address, and seized by the customs, then the package/order falls in the category of the missing orders. However, instantly items are not declared as missing orders, initial research goes into what went wrong by tracking the Airway Bill Number (AWB) Number.

Fuel Surcharge: Fuel surcharge is the extra amount of charges levied on the order due to the increase in the rate of fuel price.

Out of Delivery Charges: Out of Delivery (OD) charges are applied to an order, if the merchandise is demanded in a specific period of time by the customer.

We hope these terms will help you be aware of freight handling charges and enable you to make a wise hiring decision if you are a merchant. And, if you are a customer you know what all is included in the purchase tag.

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How Can You Make Shipping For Ecommerce Sites Easier?

shipping for ecommerce sites

         Image courtesy: Cerasis

With an accessible technology that can bring any business to the global marketplace, shipping for e-Commerce sites has become a nascent concern. Setting up an online shop gives you a chance to reach out to numerous customers in various parts of the planet. To enhance its growth, your online store needs to be integrated with a shipping company that collects and delivers product to customers in different places. This is an extremely essential feature that you should look into before launching your online business.

Online shopping has never been this trendy. And, with the mounting number of internet users, it is predicted that more and more online shops will be established. This also means better business with companies that provide shipping for e-commerce sites.

How Important Is Shipping For Ecommerce Sites?

Although physical shopping comes with a number of advantages, online shopping can compensate with its convenience. People can easily find the products through a quick browse on the internet. It requires no more legwork, but just basic computer skills. They do not have to deal with traffic, parking spaces or crowded stores. Payment is also possible through credit card, debit card or net banking. They just have to provide the card information, confirm purchase and wait for a few days. But all of these are pointless without e-commerce shipping.

Online merchants make sure that customers will gain smooth shopping experience by delivering their orders straight away. However, they don’t have the facilities and manpower for shipping products locally and internationally. Therefore, they form a rapport with various shipping companies. Online merchants want to be assured that the cargos will be delivered on time and will arrive in good condition. Luckily, there are lots of companies that make shipping for e-commerce sites entirely possible these days. They are well aware of the demand for local and international shipping of online merchants so agreed to be integrated into their interface.

How To Avoid Problems Faced During Shipping For Ecommerce Sites?

Most of the online shops today work with multiple shipping companies to collect and deliver packages. This can make it knotty to check if certain cargos were picked up and delivered on time. Customers might complain with the late or wrong deliveries, if the packages are not tracked very well. This can sink your business because online shoppers will want to get their orders quickly. They do not want to be anxious for the ordered product that did not arrive on the time expected.

In order to prevent this from happening, online merchants can use ShipRocket that integrates shipping functionality into their online store. It happens through a API integration currently available for Magento, Opencart and KartRocket stores. With this tool, online merchants don’t have to manually add every order they get on their store and check delivery status by entering AWB number in each shipping company’s website. This tool also lets you send SMS and email notifications to customers if their orders are on the way or delivered.

With this tool, you can deliver your products through any preferred courier company like FedEx, Bluedart, FirstFlight, Aramex, Delhivery, Ecom Express and many more at discounted prices. ShipRocket allows you to save up to 50% on your freight bills.

For many years, shipping for ecommerce sites has been tough due to a number of aspects that can get skewed. But with a tool like this, online merchants can sit back and relax. With this revolutionary technology, shipping for e-commerce sites has become more manageable. If you are planning to engage in an online business, it is advised to integrate this type of program to your system in order to generate more sales.

Cost Evaluation for Shipments

The cost of each shipment is reliant upon various things such as type of commodity, distance and urgency. If the commodity is to be delivered to another country, expect a higher rate. It would require bigger financial commitment compared to local deliveries. You have to make sure that there is enough margin for potential drawback. Shipping internationally can be costly. Therefore, it can shrink revenue to the point that it’s not a practical option anymore. It is essential to sell the right commodities, build a strong website and formulate an effective marketing strategy, if you want to ship to other countries.

You may place the shipping expenses to the customers, but this has its own disadvantages too. If you will be selling digital products, you may do without this predicament. The type of commodity can also affect the cost of shipping. Logically, moving commodities that require special handling (like being refrigerated at a certain temperature) can be costlier. You must inform the customers about this.

There are lots of things that must be taken into consideration when shipping commodities across borders. It is fundamental to be oriented about these and be prepared of the probable complications that may arise. Furthermore, cultural boundaries can also impinge on the flow of your business. Make certain that customers from other countries are enlightened about the terms and conditions of your company and the product that they ordered. In case they have queries, complaints or any other concerns, customers must be provided with a customer service hotline.

Online shopping is highly-popular nowadays. But it requires a good website that is integrated with an efficient shipping program to flourish in this area. If you are an online merchant, invest your money in the right business solutions. If your knowledge and skills are not adequate, it is suggested to consult the experts. Keep in mind that the functionality of your website plays a significant role in the success of your business.

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