What is logistics warehousing?

In an efficient supply chain, warehousing is one of the most important links. Warehousing allows us to regulate and optimize the flow of goods for efficient stock management and timely delivery. Supply hub logistics and storage are therefore essential elements of optimized end-to-end management.

What is warehousing?

Warehousing: definition

Warehousing is the organized storage of goods prior to their sale, and the management of workflows within the warehouse. Well-designed storage allows you to keep products totally safe and track them in real time - so you know where they are, how long they’ve been there, and how many are left in stock.

Not all storage is the same. Much depends on the type of business:

• In e-commerce, products are stored in a distribution centre until a customer places an order online. Then they are shipped directly to the consumer as soon as possible.
• In the retail sector, goods can be stored in a warehouse before being shipped to stores, which hold much smaller quantities.
• In micro-enterprises and start-ups, the manager’s home or company offices are often used for storage until the expansion of the business makes the use of a warehouse essential.

Why improve your warehouse logistics?

The goal of optimizing warehouse logistics is to minimize the storage costs (and thus operating costs) of your business, thereby improving profitability. This is possible because well-conceived warehouse logistics allow:

• Accurate real-time stock checks through better product tracking.
  
• Fewer product returns due to order picking errors.
  
• Automated restocking with reliable tracking of quantities available.
  
• Maximized storage space and reduced costs associated with dedicated storage space.
  

Efficient warehouse logistics also helps you improve your demand planning and organization with a more productive distribution of labour. That helps you minimize your costs and improve the profitability of your operations.

The 3 factors of warehouse logistics

1. Warehouse management

Warehouse management addresses the daily organization of warehousing operations.

It includes various duties such as:

• Forecasting and managing the volumes and workforce, and obtaining the necessary licences and certifications for employees using certain equipment.
  
• Implementation of best practice benchmarks and issue of all necessary equipment for safety.
• Maintaining compliance with regulatory requirements.
  
• Planning and managing operations tailored to the business as it grows.
  
• Issuing clear instructions on how to manage products in terms of reception, storage, packing and shipping.
  
• Installing special storage compartments such as trays or shelves to reduce handling effort.
  
• Collecting full information on shipments and receptions to track operations.
  

Managing a logistics warehouse not only involves supervising staff and placing stock into storage, but also providing training and equipment, and monitoring relations with carriers. It’s also essential to ensure safety and security in the warehouse, both for personnel and products.

2. Warehouse operations

Warehouse operations designates the processes associated with the movement of goods and stock tracking. These processes require the interaction of the operators, machines, storage racks and working methods in the warehouse, from the time of reception to the shipping of items.

Rack storage

There are many industrial racking solutions for the storage of products on pallets, trays or in boxes, including refrigerated installations for storage of products, especially foodstuffs, at controlled temperature.

To choose the right storage solution for each product, certain criteria have to be considered:

• The type of product and its load unit.
• The desired storage capacity.
• The degree of flexibility of storage operations.

Also, you need to consider the various systems available, and their cost.

Machines and robots

The handling equipment used in your warehouse affects the performance of your company and the number of employees required. Warehouse layout, including aisle width and shelf height, also affects the choice of equipment.

There are two categories of handling equipment:

• Manually operated machines such as forklifts, order picking carts and pallet loaders.
  
• Automated solutions, i.e. autonomous installations controlled by software. Included in this category are mechanization systems such as conveyors and goods to man robotic systems such as mobile shelf  units carried by AGV or AMR robots, stacker cranes, shuttles etc.
  

Working methods

The order picking process involves the removal of products from the shelves, sorting, packaging, labelling and shipping. Taken as a whole, this process has a significant impact on warehouse logistics, as picking is one of the primary tasks in distribution hubs.
Order picking is organized according to many parameters, such as:

• The type of goods processed: some items require more care than others when moving or packing, for example.
  
• The configuration of the warehouse: bay height, storage type.
  
• The direction of movement of the goods in the warehouse: and whether it's the employees who go and pick up the products from the shelves, or the products that come to the employees, thanks to an automated goods to man system.
  
• Methods of picking from racks: order by order, batch, wave, pick-to-cart, etc.
  

3. Warehouse management systems

A warehouse management system (WMS) is a software application that helps organize storage operations and the movement of goods and reserve products. It saves time and eliminates time-consuming and often error-prone manual processes, while optimizing inventory storage and tracking, distribution of tasks, and shipping.

WMS provides a real-time view of what’s going on in your warehouse, from physical flows to information flows, so you can manage it better. It therefore helps boost the profitability of operations in your warehouse.

Warehouse management systems are essential in optimizing enterprises’ supply chain processes. In addition to stock management, they also take care of all warehouse logistics.

The latest versions of WMS usually incorporate mobile tools allowing your entire logistics team to consult information from a smartphone.

In short, WMS summarizes all information about the warehouse to improve management of global logistics, from reception to shipment of the products.

How do warehouses integrate into your e-commerce operations?

Inventory storage

Storing inventory effectively means placing specific products in designated locations. Thus, each product is designated its own storage area in the warehouse.

For efficient storage, it's important to consider certain principles:

• Location identification: sign must be put in place to enable everyone to find the desired products more quickly.
  
• Number of units tracked: quantities in stock must be updated in real time in order to avoid sales of products that are out of stock, and to avoid overstocking.
  
• Response to product recalls, expired items and damaged stock: tracking dates and batch numbers allow identification of the exact location of items.
  
• Use the First In First Out (FIFO) method and ship oldest products first to avoid wastage due to expiry dates.
  

In some cases, cross docking is possible, i.e. received goods are immediately re-shipped without being placed in stock. This is the perfect solution for reducing storage and handling costs in your logistics hub.

Shipping and receiving products

Storage arrangement must be optimized so incoming stock can be rapidly accepted and optimally stored. To do this, you need to be informed of the products you’re going to receive, and the expected quantities.

It's also important to closely monitor the volumes already stored, so that restocking can target the areas most in need, in terms of products and quantities, and avoid stockouts.

After storage and preparation for shipping, your carriers pick up the products and take them to the customers.

Distribution centres

Distribution centres are most often used by large companies with physical and online stores. They are ideal for the short-term storage of goods before dispatch to wholesalers, retailers or directly to consumers.

Distribution centres work quickly: carriers are constantly dropping off and picking up orders.

Returns management

Supply hub logistics also involve the management of products returned by customers who were unable to do so at the physical point of sale. This means your warehouse must be designed to receive, evaluate and process each returned item.

It’s also possible to manage the entire returns process from the premises of customers, by providing labels. This allows the product to be tracked and information to be shared with the consumer from the moment the package ships to exchange or refund.

Optimized warehouse logistics not only make your business more profitable, they increase customer satisfaction too. From reorganization to automation, optimizing your distribution centre and supply chain will make you more competitive!