Warehouse mistakes cost your company money!
The cost of picking errors can be as high as losing one important customer or wasting a large batch of products because of spoilage. Usually, mistakes result in more mistakes. If you ship the wrong items you deliver a bad customer experince but also inaccurate inventory that will make the your life harder when planning for the next order. That’s why you must reduce picking errors, better accuracy means:
- Improved customer service
- Lessen the risk of inventory shrinkage
- Better data to use for planning
How to reduce picking mistakes and increase order accuracy?
The first thing to do is identifying the reasons why these inaccuracies happen in the first place:
1. Start by measuring order accuracy.
“We make mistakes” has no place in business. Regardless of your experience and feelings about how much your warehouse is missing, no data means no control. Maintain a record of customer complaints and returns until you have good data to base a proper analysis on. Errors might happen only on certain items or only when picking on certain areas of the warehouse.
2. Count inventory more often.
Count weekly or daily if needed. For companies with fast moving lines it is good practice to check inventory before and after the picks. This might be resource intensive, but it can offer immediate visibility of the mistakes with good indication of the causes. In 2015 one of the larget US retailer lost $2 Billion due to inventory mismatch. The mismatched inventory left shelves empty, customers frustrated and cost the third largest store chain in the U.S. more than $2 billion. Read more at [Source]
3. Take a close look at the receiving stage.
Don’t assume picking errors are only due to pickers. Often, the issue begins with inaccuracy when the inventory is received. Having thorough checks on receipt and put-away of the goods is a good way to ensure the accuracy of the inventory and reduce errors throughout the entire warehouse process line
4. Implement an effective Order Picking Method.
There are several order picking methods. Depending on the size of your warehouse, the type of items and the frequency of the order, one might be better than the other to reduce picking errors.
- Zone picking
With this method the SKUs are stored in different part of the warehouse for reasons of dimension, or storage constraints like temperature. When an order that contains items in different zones is to be picked, the order generates more than one pick note. Each note contains items in a specific zone like ambient and chilled. Different pickers may work in assigned zone. The picks are then consolidated before the shipment.
- Batch picking
Also known as multi-order picking it consists in combining all the items required from multiple orders into one pick instructions. After picking, the items are sorted by order or shipping destination. This method usually results in better accuracy, but it may cause duplication of work if not planned well. Food and Bev companies may want to use this method is they have many orders with small number of SKUs.
- Wave picking
Very effective when order contains an average of 1 to 2 shipping boxed. The shipping boxes are placed on a cart that can carry 5 to 10 cartons and the picker, moving the cart through the warehouse isles, picks items and place them directly in the shipping carton. This method can be a fast way of picking many orders. Wave picking is almost always paired with barcoding and RF scanners. Technology tremendously effective to reduce picking errors
5. Redesign Pick runs
A pick run is the route to follow when picking items in a warehouse. Having a predefined route to follow when picking items will make the process faster and safer. Also, by having the pick paperwork sorted according to the route, the risk of missing a line is very low. Pick runs should be designed together with the allocation of items to the BINs where larger and heavy items are picked first and lighter items later. This will also ensure better stacking and lower risk of breakage
6. Make pick notes easier to read
Documents used for picking should only have essential info to complete the pick task. Avoid unnecessary clutter that might create confusion like long descriptions, case dimensions for items picked in single units. Include weight only if essential, like shipping charges or selling price depending on weight
7. Use barcoding and RF scanners
Most Food & Bev products already have barcodes on the packaging. Even with a basic WMS these barcodes can be recorded and scanned to confirm the picks. Paired with barcoded labels on the warehouse shelves, this technology is the best way to increase order accuracy. The downside of these solutions is adoption time. Warehouse teams can be reluctant to move to scanners, even more so if they have been using paper and pen for long. There are proven tools to iplement enterprise technology, check out my blog post - How to save on IT projects
8. Rotate staff
Repetition can lead to loss of focus, having warehouse team members doing the same activities repetitively often results in loss of accuracy. This happens when users are so used to a process or set of tasks that they stop paying attention to the details. In the absence of technology or control tools, rotating staff to different warehouse areas or assigning a diverse range of tasks usually helps keep the attention high and reduce picking mistakes.
9. Implement Quality checks
Quality control should be a must for any Food & Bev business. Not just regarding product quality but processes too. This is not to intimidate users, but to support them in their daily tasks, knowing that part of the orders will be checked for quality purposes, in addition to help spotting mistakes before the shipment, a way of maintaining the attention high during the operations.
All the solutions above can effectively reduce the order picking errors. But come at a cost. Designing and implementing new processes, training members of staff, allocating resources to quality control. Some entrepreneurs believe that these costs are not worth investing on. But they miss a point. Any effort to improve business processes come at a cost. The problem is to justify the investment with a cost/ benefits analysis. If increasing customer’s service level is needed to renew a listing worth million, maybe investing ten thousand on barcoding and scanners in not a bad idea; while reducing wastage of one of two cases of inexpensive items may not justify such investment.
If you would like to engage expert support as you look to reduce waerehouse pickigng mistakes please get in touch and let’s have a conversation.