Warehouse Slots: A Powerful Tool for Optimizing Storage in Your Warehouse

With the support of modern technology, you always have ways to better organize your warehouse for faster and more accurate warehouse picking.

You may have noticed that many well-known and growing e-commerce companies employ slots to enhance picking performance, optimize warehouse space and reduce the overall costs associated with inventory management and warehousing.

In this guide, we’ll give you an overview of what a slot is, what benefits it can bring to your warehouse, and how you can implement it.

Let’s read along.

What is a warehouse slot?

Slotting is simply the process of structuring a warehouse to maximize and utilize storage space as efficiently as possible, resulting in increased picking efficiency, minimized replenishment, and improved overall operating costs. The process organizes SKUs based on size, weight, unit sales velocity, and products that are often ordered together.

What are the advantages of storage space slotting?

1. Improved picking efficiency and fewer errors

Without a strategic storage space layout, warehouse operators lose a lot of time traveling and searching for products. Typically, pickers’ time is spent on.

53% on walking through the warehouse

17% looking for product locations

22% Waiting in line

8% actually picking product from the location

Correct slotting leads to higher picking accuracy by eliminating potential confusion caused by the picker. It permits faster picking by eliminating the guesswork of where certain items are located by storing the products that make the most sense to the picker (e.g. by type, size, weight, etc.). This allows pickers to focus on speed rather than spending too much time finding the correct item.

2.Greater Storage Capacity

Slots contribute to creating opportunities to increase storage capacity. If you perceive that your warehouse is full, it’ s a good way to reclaim much needed inventory space by reconsidering how your inventory is currently stored. Having taken the time to optimize your warehouse means you can delay expansion and/or spend extra money on additional storage.

3. Reduce shipping costs

Instead of using more people, equipment or renting more warehouse space, you can reduce your overall shipping costs by optimizing your warehouse space and improving your processes. You can easily calculate the current cost of ownership using the following formula.

Inventory holding cost = (storage cost + staff salary + business opportunity cost + depreciation cost) / total annual inventory price

4. Injury reduction and ergonomics

According to the product definition of “heavy” or “fragile”, the product is properly placed. Therefore, picking and retrieval can also be done accurately.

Slotting guarantees superior ergonomics. Frequently moved goods are placed at mid-level, reducing work-related accidents or injuries. Warehouse operators are also happier and more efficient.

5. Equalization of workload

Storage space slotting brings a complete understanding of the product movement cycle. When the warehouse manager knows the high, 16px and low moving items, especially their respective bins, work can be evenly distributed to all warehouse operators.

Scheduling inventory slots: simple and effective practices

Slots are critical to efficient warehouse management and can impact inbound and outbound logistics processes, but getting started can be a challenge. The following are some of the most common best practices to keep in mind.

Determining Demand Correlation

Demand correlation in the warehouse is used to describe items that are typically ordered together. You can identify products that are typically ordered together by looking at past order history. From there you can reorganize products so that items that are typically purchased together are closer to each other, which can significantly reduce picking time.

Feedback from pickers

More than anyone else, pickers know your current warehouse layout as they are always moving through the warehouse. The pickers on the floor may have suggestions on how to rearrange to improve efficiency. Work with the picker to identify opportunities to better organize your inventory to eliminate headaches and confusion in the order picking process.

Sort SKUs by item level and storage type

Forklifts are required for items picked from full pallets, but not for individual pieces. Keep SKUs organized by picking material level (single item, case, full case) and storage type (warehouse shelf, rack, carton), and keep basic equipment (forklift, pallet truck, cart) nearby. With SKUs organized in this way, you can eliminate any bottlenecks in the picking process, such as forklifts getting in the way of a single pick.

Make an investment in a warehouse management system

Your warehouse management system (WMS) enables an easier slotting process and has additional features that contribute to warehouse optimization. By implementing technology in the warehouse, pickers can easily locate where SKUs are stored using wearables or handheld devices, rather than relying on a list of SKU numbers on a spreadsheet.

It makes the slot optimization process easier by investing in a WMS that eliminates guesswork and uses technology to get the job done faster and more accurately.

Summary

It is important to understand that storage space allocation is a dynamic process. With changes in products and customers, storage space layout strategies must change as well. The warehouse has to undergo regular reviews to check if the current strategy is enabling it to reach its full potential.

Want more help and information? Please write to us with questions about your current warehouse storage space optimization.

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