Top Tips For Multi-Warehouse Inventory Management

Maintaining accurate control over products in your warehouse is the key to effective inventory management. As companies transition from a single-warehouse to a multi-warehouse model, however, they often encounter problems with inventory accuracy. Small problems that could have been easily addressed with a single-warehouse model have a way of becoming much more difficult problems with a multi-warehouse model. With that in mind, here’s a brief overview of best-in-class tips for multi-warehouse inventory management.

Tip 1: Optimize Communication Flows Across Warehouse Locations

Making sure that all warehouses are on the same page is harder than it sounds if you are not using specialized inventory management software. Without a shared software solution, each warehouse is going to have its own filing system, its own order system, and its own way of maintaining physical product counts. Thus, the goal of any inventory management system should be cross-warehouse communications. The key to streamlining and maintaining processes is making sure that there is consistent communication flow between and among the different warehouses.

Tip 2: Ensure That All Data Remains Synced Across the Organization

If you are not using an integrated inventory management solution, you may experience time lags as different warehouses update their systems. Thus, it’s very important that you look for ways to implement real-time data flows covering all the major facets of inventory management. This is especially true if you are regularly transferring products from one location to another (such as from Montreal to Vancouver), or if you have recently experienced a spike in order flow.

The real advantage of inventory management software is that it not only enables different warehouses to talk to each other, but also it enables a company to integrate its accounting and sales functions with the inventory management function. Thus, as soon as sales orders come in, this data can immediately flow to the operations and logistics team. And, as soon as there are changes to warehouse inventory stock, these changes can be reflected within the accounting system of the company. If company managers are regularly running reports, you will appreciate the transparency and visibility into the company, confident that all data is synced.

Tip 3: Re-Evaluate How You Do Warehouse Inventory Stock Counts

Since there are multiple ways of doing inventory stock counts, your business might need to re-evaluate the method it is employing within a specific warehouse location. For example, a method that might work well with just a handful of high-value items in one location might not work nearly as well for another warehouse location with thousands of lower-value products.

The problem with inaccurate, delayed, or otherwise flawed inventory stock counts is that it can lead to specific problems that can cause any inventory-centric business to grind to a halt. Chief among these problems is the ever-present threat of an inventory stock-out. With just a single warehouse location, it might be possible to detect a depleted stock level of a popular product. However, with multiple locations, it is easy to assume that “the other warehouse location” must have ample supply of this product. But that’s not always the case, and that is what can lead to inventory stock-outs and a high quantity of backorders.

Tip 4: Change the Layout of Your Warehouse Locations

There are a few best practices for warehouse inventory management that are commonly shared across all industries. Chief among these is that high-volume and popular products should always be stocked near the loading dock (i.e. the exit). Over time, the time savings from this approach can really add up. When it comes to the overall layout, you also want to make sure that people pulling product off the shelf are not caught in a giant maze.

If you find that executing orders is taking too much time and leading to shipping delays, then it might make sense to create maps of the warehouse that can be shared with employees. And it definitely makes sense to label each shelf, each zone, and each area of the warehouse very clearly. In many ways, warehouse layout is just an optimization problem: your goal should be to reduce the overall path traveled by employees as they fulfill orders, and to make the most popular products easily accessible on the shelf.

Tip 5: Optimize Warehouse Locations For Geography

Geography plays a role, too, in multi-warehouse inventory management. In the best of all possible worlds, your warehouses would be located as close as possible to the end customer. Thus, instead of waiting for a product to travel from one end of Canada to the other, you can get the product into the hands of the customer within 1-2 days. This saves on shipping and transport costs, obviously, and it also improves overall customer satisfaction when they receive orders within a very short period of time.

That being said, not all warehouse locations can be located within close geographical proximity of customer bases. For one, there is the issue of higher labor and rental costs associated with basing a warehouse in a very densely populated metropolitan area like Toronto. Moreover, there may be regulatory or tax issues involved with moving a warehouse to a certain geographic location. For that reason, warehouse location involves a number of factors, including the trade-off between rental costs and transport costs for a certain region.

Tip 6: Look For Cost and Time Savings Based On Inventory Data Flows

Businesses should be constantly streamlining their logistical and operational flows, and one way of doing this is by tapping into all the data that your business is generating across the supply chain. Data about order transport and shipping times, for example, might be used to move products from one location to another, so as to speed up the overall shipping process. Moreover, information that is being fed into the system from accounting and sales teams might be used to anticipate consumer demand for a particular product.

The more that your business can become proactive, and not just reactive, the more successful that it is going to be. By leveraging these top tips for multi-warehouse inventory management, you can ensure that your business stays one step ahead of the competition.

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