Addressing Inefficiencies in your Warehouse to Increase your Bottom Line

By Dan Carter, Project Manager at Libra Change

With the availability of 3rd party warehousing a concern for many and with the cost spiralling, clients are approaching Libra Change to identify efficiency savings within their own operations.

Libra take a structured, process-driven and analytical approach to identifying opportunities within clients’ operations, unlocking significant value.

Whether as a standalone piece of work or as part of a bigger scoping exercise, the cost savings from carrying out a Libra Change Warehouse Analysis can be considerable.

In this example, our client had instructed us to work with their 3PL to optimise their warehouse operation by identifying all cost-saving measures possible. The client had 25,000 pallets spaced available in their own warehouse but were still needing to use costly external storage facilities which made the creation of any available space so valuable.

We found multiple cost-saving opportunities and many of these specifically related to pallet space:-

  • Declutter the racking – 645 pallet locations were identified with items such as office supplies and expired or obsolete stock. Whilst there was a cost to writing off a portion of these items, this was by far outweighed by the equivalent cost of the pallet space recovered.
  • Multi-SKU locations – Items were picked by individual units rather than pallets. Multiple pallet locations were only partially full. By creating three small pick faces, multiple low-quantity SKUs could be held in the same location, freeing up a further 36 additional locations.
  • Pallet size variation – A large number of pallets were identified in rack locations that were taking less than half the space of the available bay. By splitting these locations, storage capacity was doubled which freed up a further 253 locations.
  • Alternative storage solution – 112 locations were unused due to structural girders making standalone racking infeasible. These were opened up for use by the installation of hanging racking.
  • Unused space – Space at the rear of the warehouse was identified where new pallet bay locations could be created by installing new racking

The project identified over £400k in overall savings with £114k as a result of the interventions above, which identified 1,178 additional pallet locations and significantly reduced the client’s reliance on expensive 3rd party warehousing space.

If warehouse space or 3rd party cost and availability are concerns for your business, contact Mike Sacker (mike.sacker@libraeurope.com) or on 07771 666792 to find out how Libra Change could help you.

 

 

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