Whether you have a small or a medium-sized online store, setting up or organizing your warehouse in an efficient way is very important. If you get more orders or your assortment expands, you don’t want your warehouse to put the brakes on the growth. But properly setting up your warehouse storage doesn’t need to be so difficult.
Let’s just start with the biggest mistake you can make when you’re setting up a new warehouse. And that’s thinking of it as a big box where you can store your items. Yes, it’s a storage place, but you must not treat it as one. Because every single item in your warehouse needs to be stored, but it also needs to be tracked, moved, and prepared to be shipped. So, just dumping your stuff in the corner of a warehouse, and expanding from there, won’t do the trick.
- Organizing your warehouse storage
- The right storage shelves
- Smaller aisles?
- The different areas in a warehouse
Organizing your warehouse storage
When you’re organizing your warehouse storage, try and keep in mind that there should be room for an uninterrupted flow of goods at any time. Items will pass by in all different areas of your warehouse, whether it’s the receiving zone, the storage shelves, the picking route or the packing stations.
Forget about storing your items, and keep reminding yourself you want to ship your items. So, that’s what needs to happen efficiently. And that’s how you are going to design your warehouse storage.
Forget you’re storing items, and remember you want to actually ship them.
It could save you a lot of time and money
(Re)arranging your warehouse storage can be very rewarding. Not only in terms of capacity, but also in terms of efficiency. Especially when you process many orders every day, there is a good chance several hours per day will be spent on order picking, packing, and shipping. So, even if you could only gain ten percent of the time, this would still yield enormous cost savings. Furthermore, setting up your warehouse the right way also reduces physical complaints and (thereby) increases the working atmosphere.
With the number of orders growing, having an efficient warehouse can save you a lot.
The right storage shelves
Online retailers who started their online shop from their basement or garage, are probably familiar with the next situation. Having put up a storage shelf, finding out you need more space and then you’re just cramming everything as good as it gets. You’re putting goods on top of each other, you lose track of where you have kept things and everything is just becoming one big mess. Or maybe you have found someplace to set up a second storage shelf, but now there’s less room for walking around freely while picking your items.
It’s important to not just buy some storage shelves from a random DIY store nearby. Be aware of the size of your items and adjust your shelving units accordingly. Some products may be very large, and you don’t want them to stick out in every walking path. This could lead to some dangerous situations for you or your workers!
The smaller the aisles between the shelves, the bigger the actual storage capacity of your warehouse. By making your aisles a little bit smaller, you might end up having enough space to add some extra rows of shelves.
But don’t make them too small! You might think, for now, it should be wide enough for a picking cart to go through, but what if you decide to let two picking carts stroll next to each other in an aisle? The last thing you want to do, once your online store is expanding, is having to totally reorganize your aisles and shelves.
Different areas in a warehouse
As we said before, there are many different areas in a warehouse. It’s not just about storing and picking your items, they also need to be packed, right? And what about getting them in or out of your warehouse? When designing your warehouse floor plan, keep this in mind. Infoplus has made a nice design for a small business warehouse layout:
As you can see in the image above, this fictional warehouse is divided into 7 different areas: the receiving staging area, the storage picking area, the packing station, the ship area, the ship staging area, the office space and free area. When you are designing your warehouse layout, keep in mind the different areas and the role they purpose.
The receiving area
This is the area where you receive your items. Most smaller warehouses often have a single dock for both shipping and receiving. This isn’t very handy. You don’t want items piling up in your shipping area. Whenever you receive your goods, immediately put them into a receiving area. And keep this part of the warehouse separate from fulfilment and shipping.
Storage and picking area
The storage area is where you store your items and pick them whenever they are ready to be shipped. In this area, you need to establish a clear and efficient route for your workers. Items that are ordered quite often (the so-called high-velocity orders) should be accessed easily. So think about putting them in the front of your storage area and/or as close to your packing station as possible, so the travel time is minimized. Less popular items can be kept in a larger bulk storage area somewhere in the back.
The packing station
You should make a designated area for packing items. While thinking of a good place to put the packing station, try to design it so that goods can come in at one end and finished packages come out the other. Think of the order “pick, pack, ship”. Pickers bring the items to the packing station, where the goods get packed so they can get shipped away.
The shipping area
You should also have a separate area for shipping items. Because you need to be able to send a parcel to its customer. Once an item has been packed and has the correct shipping label, set it aside. You do this, because it is then ready for pickup at any time, but also because you make some space in and around the ship station.
The area you aren’t using now, can still be used for a good cause. For example, for your workers and machines to move more freely. Or to have more space between the receiving and shipping areas. If your online store grows further and further, you might give up this free area and turn it into something else, like an extra packing and shipping station, or an extended area for your high-velocity orders.
Frequently Asked Questions
Here are some frequently asked questions about setting up and organizing your warehouse storage:
How much does warehouse storage cost?
Many online retailers want to know how much warehouse storage costs. There is no simple answer to this because it differs per situation. You pay more if your warehouse is at an “A”-location and if it’s in a major city. The rule of thumb for warehouse storage costs is 75 euros per square meter. Here is a list of how much warehouse storage costs in different cities across Europe.
Rule of thumb for warehouse storage costs = €75 per m²
The most expensive areas for renting warehouses in Europe are in the United Kingdom, Norway, Finland and Germany. For example, in London Heathrow you pay 215 euros per square meter per year, while in the Polish city of Poznan you only pay 41 euros. That’s also why most major online retailers have their distribution centers and warehouses located in European countries such as Poland.
Why choose a warehouse if there's dropshipping?
Dropshipping is a very popular business method for online retailers. It enables them to sell products, without them having to worry about storing, picking, and shipping the items. Whether it’s a good choice to go for warehouse storage or dropshipping, depends on your ecommerce business.
When you choose for warehouse storage, you can see your inventory. If you have bought new products, you can check them yourself to see if the quality meets your standards. You can make product photos or try the items out to better answer any questions from your customers.
How to calculate warehouse storage capacity?
In warehouses, the space is the most valuable asset. So it’s important to make the best use of your available warehouse space. Don’t think that every meter in a warehouse can be used for storage. You need space for aisles, but also don’t forget bathrooms or offices.
Furthermore, don’t just think in square meters. There’s lots of space you can use when you go up! So you need to calculate your warehouse’s storage capacity in cubic meters.
So, how to calculate warehouse storage capacity? Take the number of square meters that are available, subtract the square meters you can’t use from this and then multiply it with the height in meters you can use when you go up.