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Use your current warehouse space creatively and efficiently and avoid the cost of expansion.
By Steve Arendt
Your warehouse is overflowing with tools and inventory, so you’ve obviously outgrown your current space. Are you sure? Buying a new building or adding on to an existing structure are expensive and complex propositions. Changing the way you approach your inventory space may reveal solutions and efficiencies that offer benefits beyond avoiding the expensive hassles of moving or expanding your square footage.
The first step is to define your motives for an expansion. If your existing building simply feels congested, and normal growth is in your future, consider reorganizing your current space. You can solve your space issues and use the opportunity to become a more efficient organization. On the other hand, if you are confident that guaranteed, substantial growth is in your immediate future, then move into a larger space as quickly as you can.
If you opt for sticking with your current space, start your reorganization by segregating your inventory. Make a list of those items that are rented most often. Next, ask yourself what items are requested occasionally. Finally, identify those pieces that rarely make it off the shelf. The items that almost never leave your building are dead stock.
Once you’ve triaged your inventory, consider either selling the dead stock or storing it in a much less expensive off-site location. This will free up space to properly store the items that make the most money.
Time to scheme
Before you do any rearranging, take time to properly plan your new organizational scheme. The most rented items in your inventory need to be in the most accessible space, and the least rented items in the least accessible space. The insight of a material handling specialist will be well worth the cost if it helps you to avoid a physical expansion and allows your employees to work more efficiently. This person will be able to design shelving, create efficient aisles and take advantage of interior ceiling height to maximize your space. Be sure to discuss how inventory will move into and out of your building on a daily basis.
High quality material handling tools are wise investments. The correct hand trucks and forklifts for your situation are a must. Palletizing as much inventory as possible is always a good idea. Custom, stackable stillages maximize floor space for table and chair storage.
Once you have your new design, take time to outline the day-to-day processes of using the reorganized space wisely. Develop clear plans and systems on how material will move through the building on a daily basis. One thing is certain: space is at a premium. Rental inventory entering your building must be unloaded, repaired, cleaned and returned to the shelf as quickly as possible. Consider these strategies for using your space wisely:
- Ask your industry peers what they have done to develop their warehouse systems, attend a trade show, post a question on a LinkedIn® group, ask a vendor or call an IFAI member in another city.
- Consider subcontracting some of your cleaning and repair.
- Make sure your employees understand how this new system will operate and what their part is in it. Explaining why the system exists can go a long way in motivating employees to follow established processes, especially in your busy times when inventory is coming and going at a quick pace.
- Consider how you might use your outdoor space for repairs and cleaning during busy times.
- Leverage the time your building does not normally get used. During your busy months, could evening hours be used for a second shift to unload, clean, repair and reshelve the inventory?
- Consider changing how you maintain and clean equipment, or purchase new machines to speed up your cleaning, save space and ensure consistent quality.
Reap the rewards
Be aware: reorganizing for maximum efficiency is difficult and time-consuming. If you are willing to accept this challenge, treasures will await you. You will avoid the expense of a new building or addition. Making your most rented inventory easier to load and reshelf will reduce labor cost. Being able to quickly and efficiently get your inventory ready to rent again will have a positive effect on your profit, reducing the need to purchase new inventory and improving cash flow. Mistakes during busy times will be reduced.
If you are feeling a bit cramped and hoping for some growth, this may be the perfect time to simply leverage your existing resources. The cost will be a fraction of the expense of a new building or addition. Taking the time to be creative and systematic with your current space has the potential to make your company more efficient and profitable.