Is your product positioning optimal? This is one of the countless questions asked by many managers who are hampered by the current lack of resources.
The business context that the commercial world has been experiencing for more than two years has not spared distribution centers and warehouses in general. Given the e-commerce boom, each one has had to reinvent its workflow to adapt and respond to different types of orders.
Today, many distributors must deliver a large number of small orders to many individual customers. The relationship has completely changed between orders intended for stores and orders for individuals.
In order to adapt, many have revisited the layout of their warehouses, examining the flow of goods, equipment, and human resources.
The question of optimal location of stocks in warehouses is one of the keys to optimizing your logistical activities.
Order preparation is at the heart of warehousing operations. It’s one of the key aspects of logistics management—with the objective of fulfilling orders within the prescribed deadlines and the expected quantities, at the lowest possible cost.
What Is Slotting?
Slotting is a strategic product relocation exercise during which we determine the most beneficial organization according to several criteria:
We can’t stress this enough: the quality of master data is at the heart of slotting. Without information about the dimensions and weight of the products to be stored, it’s impossible to precisely determine the type of storage equipment to be used, or to optimize the space required to store the goods.
- Velocity – what are the best sellers?
- Physical characteristics – dimensions and weight
- Attributes – determine storage and handling needs – here are some examples:
- Refrigerated products
- Explosive materials
- Products that cannot be stored cold
- Products that must be handled with specialized equipment (e.g., rolled carpets)
What Are the Steps Leading to an Optimal Product Slotting?
a) Pre-positioning: it defines the current state in a clear manner and lays the foundation for comparing future results.
At this stage, we look at the storage equipment used and the size of locations allocated to the various products, and we also define the space used for each storage area.
During this stage, technical tools combining the data collected on the products, the movements, and the AutoCAD plan of the installation in its current state allow us to simulate various equipment options and measure their effect on operations: flow of goods, traffic, etc.
At this step, we also assess whether the space for each product’s picking location is adequate. The size of picking locations can be determined using criteria such as the desired replenishment rate. Some products may require different replenishment rates – for example according to their velocity or seasonality.
b) Block layout: Various simulations are used to determine the space or volume required for each storage area.
By combining factors such as velocity and the simulation of various storage technologies, we can make a final choice in terms of space and equipment.
c) Slotting: the final location of products is done only when the space allocated to each zone has been defined and the storage technology has been chosen.
It’s then possible to identify the optimal picking location for each product.
Now we can calculate productivity gains in a concrete way. Each trip saved and each optimized movement contribute to improving operations, and increasing the capacity of the team and the quality of the results.
Benefits of Optimal Product Slotting
A successful slotting operation translates not only into a gain in productivity, but also in a reduction in the distance covered by the order pickers, and an increase in the number of lines per hour, which frees up resources to either increase the volume of orders prepared, or alleviate the lack of manpower that affects almost all companies in 2022.
Furthermore, the process makes it possible to solve health and safety problems that are too often present in the warehouse. The review of movement flows as well as the selection of storage technologies help to mitigate risks.
This optimization can also facilitate human resource planning, improve productivity, and make your site a safe place. It can also generate savings through reduced travel (e.g., reduced wear and tear on rolling stock).
However, this process is not permanent. As conditions change over time, it should be reviewed periodically to reflect changes inherent in each industry.
Seasonality, changing trends, and expansion of product lines to be manufactured are all factors that have an impact on operations and warehousing needs.
In certain industries, slotting may need to be done each season. For others it can simply take place every three years. The interval varies depending on how often stock keeping units (SKUs) change.
Start Your Product Slotting Process
When it comes to warehouse operations, one of the most effective ways to increase efficiency is through product organization. This involves determining the optimal layout for storing goods in your warehouse and targeting ways to improve productivity when picking, packing and shipping orders.
While it may take time and effort, the benefits of product organization can be a game changer for your business bottom line.
Better organization can lead to faster order fulfillment, lower costs and ultimately lower logistics expenses.
If you wish to optimize the product positioning in your warehouse, don't hesitate to contact us. One of our experts will assess your needs and be at your disposal to improve the efficiency of your installation.