Order
Picking Process and Efficiency
Order picking, the process of retrieving goods
from warehouse storage locations to fulfil customer orders, is not just a
crucial aspect of warehouse operations, but a direct response to the increasing
service expectations of customers. The items, stored on racks, shelves, or
pallets, are retrieved manually or with automated systems. This process, which
accounts for a significant portion of warehouse operating costs, requires
careful coordination. The efficiency in order picking significantly impacts
warehouse productivity, making it a critical target for optimisation in
response to increasing service expectations.
As customer demands for faster and more
accurate delivery grow, order picking has become a bottleneck in warehouse
logistics. However, reducing the cost of this activity is not an insurmountable
challenge. With the use of advanced methods and technology, such as batching
orders and optimising picking paths, costs can be significantly reduced. These
approaches, which reduce the time a picker spends traversing warehouse aisles,
ensure greater throughput without compromising accuracy or unnecessarily
increasing labour costs.
Most order picking activities occur after
regular hours, during low-demand periods, or in bulk for future delivery.
Picker Specials, which are designated areas where high-demand items are
efficiently accessed during work hours, are a key part of this process. Dense
aisle arrangements near picking zones improve pick rates and reduce walking
time. Together, these tactics enhance the speed and accuracy of order
fulfilment, minimising delays and operational strain during peak periods.
Increasing
Operational Efficiency
Organisations aiming to reinvest in warehouse
systems should begin by optimising current operations. Efficiency improvements
can significantly benefit overall performance. Traditionally, warehouses stored
large volumes of inventory, but modern practices emphasise Just-In-Time (JIT)
inventory and shared stock models. The goal remains unchanged: meet demand
quickly and cost-effectively while maintaining delivery quality and controlling
overhead costs.
With declining inventory levels and expanding
retail footprints, warehouse operations have become increasingly important
within the supply chain. Efficient warehouses are not just about internal
operations, but about ensuring smoother distribution, lower inventory
pipelines, and reduced costs across the entire network. Consequently, frequent
assessments of warehousing operations help unlock performance improvements,
benefiting the broader distribution system and enabling greater responsiveness
to shifting market conditions.
Maintaining operational efficiency is not a
one-time task, but a continuous process that requires ongoing performance
reviews. Establishing and publicising key performance indicators (KPIs) is the
first step towards accountability. However, initiative-taking measures must
follow, such as adjusting procedures or motivating staff. Daily warehouse
walkthroughs remain a powerful management tool, while tactical decisions, such
as staffing levels and scheduling, form the backbone of long-term operational
success.
Warehouse
Order Picking Strategies
Order picking is a core function that involves
selecting items to fulfil customer orders. It accounts for up to 70 per cent of
total warehouse operating costs and employs a substantial portion of the staff.
As such, streamlining this activity can lead to significant operational
savings. The strategy chosen often depends on order types, such as single,
batch, or multi-order, and varies across different warehouse sections.
Two primary systems guide order picking:
person-to-goods and goods-to-person. In person-to-goods systems, workers travel
to select items and use methods like discrete, batch, wave, and zone picking.
These systems are flexible and economical, commonly used in diverse warehouse
settings. Conversely, goods-to-person systems use technology to deliver items
to stationary pickers, leveraging tools such as carousels and pick-to-light
stations to reduce walking time and boost precision.
Picking methods also vary by mobility. Workers
may walk, use electric vehicles, or operate mechanised carriers. In advanced
warehouses, robotic and automated picking systems further reduce manual labour.
Choosing the right strategy depends on warehouse layout, product types, order
frequency, and technological investment, each contributing to improved order
accuracy, reduced turnaround times, and optimised labour use.
Dispatch Optimisation
Techniques
Optimising dispatch
processes enhances pick vehicle utilisation by synchronising warehouse picking
with logistics delivery scheduling. Through careful coordination of picking
tasks and transport resources, warehouses achieve higher productivity and reduced
idle time. Dispatch algorithms help assign pick vehicles and schedule jobs more
effectively, aligning them with outbound delivery timelines. These include
sequential, greedy, and priority-based models, each aiming to maximise
efficiency through timely, location-sensitive order dispatching.
Sequential dispatch
uses a fixed order of job and vehicle assignments, which improves clarity but
limits flexibility. In environments with frequent changes or disruptions, this
rigidity may delay progress, as vehicle tasks cannot quickly adapt to new priorities.
As a result, pick vehicles risk becoming underutilised during scheduling gaps,
particularly when last-minute deliveries or amendments are frequent, which
reduces overall warehouse responsiveness and throughput.
Greedy dispatch
approaches increase pick vehicle responsiveness by allocating tasks based on
proximity and speed. This enhances agility and helps reduce vehicle travel
distances. However, by focusing on immediate gains, these algorithms may
unintentionally generate congestion or misalignment in wider warehouse
operations. Priority-based dispatch systems offer a balanced alternative,
weighing task importance and timing to optimise pick vehicle routes while
supporting critical delivery windows.
Priority dispatch
methods enhance vehicle utilisation by targeting high-impact tasks, ensuring
alignment with outbound schedules and logistical constraints. Although they
require more data and computational resources, they offer superior strategic
control. By dynamically ranking picking jobs and vehicle availability, priority
systems adapt to shifting demands, supporting efficient warehouse flow and
reliable delivery performance, especially in high-pressure or time-sensitive
distribution scenarios.
Predictive
Analytics in Warehouse Management
Traditional warehouse management relied
heavily on manifests and bills of materials. Today, predictive analytics has
transformed data into a powerful tool, combining inventory details, demand
forecasts, and operational inputs to anticipate future needs with greater
accuracy. This not only enhances planning but also mitigates the risk of
stockouts or overstocking. Construction projects and dedicated accounts can
also indicate demand for targeted shipments. Predictive analytics, therefore,
plays a crucial role in efficient warehouse management by providing insights
that can inform decision-making and resource allocation.
Modern warehouses utilise mobile data
terminals to enhance communication and provide real-time updates on inbound and
outbound activities. These tools increase visibility, linking actions to
results and identifying underperforming processes. Automated data collection
systems further enhance inventory tracking and operational planning. These
systems can operate in either real-time or batch mode, depending on the
warehouse’s infrastructure.
By integrating predictive models into their
daily decisions, warehouse managers can more effectively allocate staff, space,
and equipment. Forecast accuracy improves when real-time inputs, such as
current inventory levels and ongoing order processing, are combined with
historical trends and data. This blend of experience-driven intuition and
data-backed science allows warehouses to meet demand reliably, minimise cost,
and adapt quickly to changes in supply chain dynamics.
Best Practices for Order
Processing
Order processing accuracy remains fundamental
to warehouse operations, as it directly influences customer satisfaction and
business success. To reduce errors and returns, warehouses should begin by
organising inventory systematically. Frequently ordered items should be placed
near each other and closer to dispatch stations, while heavy items are best
stored on lower shelves. Clear labelling and consistent shelving layouts
further enhance picking accuracy, ensuring staff can quickly locate and
retrieve products.
Integrating technology into order processing
supports efficiency and accuracy. Barcode scanners, warehouse management
systems (WMS), and routine cycle counts help track stock levels and identify
discrepancies in inventory. Regular audits of incoming orders prevent inventory
mismatches, while historical order data informs forecasting models. Staff
training remains critical, as it ensures that all employees understand their
role in maintaining accuracy, handling errors promptly, and applying data
insights to prevent future mistakes.
Manual review of pick lists remains essential,
despite the availability of technological support. Workers benefit from mobile
systems that display order information while allowing real-time item
verification. Items are picked, repacked, sealed, and labelled with precision
before dispatch. Though time-consuming, handpicking ensures attention to
detail, particularly in complex or high-value orders. When supported by digital
checks and robust procedures, manual methods can enhance overall processing
accuracy.
Streamlining Order
Fulfilment
Optimising order fulfilment ensures that the
correct products reach customers on time, reducing delays and associated costs.
Given the significant proportion of staff dedicated to picking and packing,
simplifying these workflows is essential. Streamlined fulfilment contributes to
operational agility, improved throughput, and enhanced customer experience.
Efficient fulfilment models also support flexible scaling during seasonal peaks
or high-demand periods, providing a competitive edge in dynamic supply chain
environments.
Traditional paper-based pick lists often lead
to inefficiencies and mistakes. Advanced picking systems, such as voice-picking
and pick-to-light technologies, reduce errors by confirming actions
electronically. While voice-picking increases accuracy, it may limit speed;
pick-to-light requires a higher investment but speeds up operations. Emerging
optical systems, such as augmented reality, offer potential future benefits but
remain in trial. Implementing the most suitable method depends on order
complexity, volume, and cost-benefit considerations.
Once items are picked, proper packing is
crucial to prevent damage, minimise returns, and manage shipping costs. Basic
methods include weighing boxes during packing and monitoring closure processes.
Advanced systems simulate optimal pack arrangements and guide staff through a
step-by-step process. Automated packing is ideal for high-volume operations,
offering speed and accuracy. Whether manual or automated, consistent packing
practices play a critical role in both customer satisfaction and operational efficiency.
Quality Control Measures
Quality control during warehouse operations
begins with receiving procedures. When items arrive, product details should be
cross-checked against barcodes and delivery slips to ensure accuracy. Each item
is then allocated to the correct storage bin. This initial verification is
crucial, as it prevents incorrect storage, reduces stock discrepancies, and
maintains confidence in supplier consistency and performance.
Visual inspection of received goods helps
identify packaging defects and shipping damage. Torn, compromised, or detritus-covered
packaging often signals compromised product quality. Warehouse personnel must
report such damage to suppliers immediately to trigger corrective action.
Proper documentation of these findings ensures accountability and supports
future vendor evaluations. This early detection process helps maintain high
service standards and avoids downstream processing issues.
Further quality control includes weighing
received products to confirm compliance with supplier specifications.
Discrepancies in weight or dimensions must be logged and reported. For certain
items, Certificates of Analysis (CODs) are required to verify product
integrity. These must be reviewed and approved before stock is cleared for use.
Consistent enforcement of these checks strengthens compliance, reduces risk,
and ensures all incoming stock meets company and regulatory standards.
Standard Operating
Procedures
Standard operating procedures (SOPs) provide
structured guidance, enabling consistent performance across warehouse tasks.
They support inventory accuracy, minimise errors, and improve overall
productivity. SOPs are especially valuable for onboarding new employees, as
they help them quickly grasp task expectations. Written SOPs also serve as
reference points, reducing reliance on supervision and empowering employees to
work more independently and confidently.
SOPs clarify performance standards and
expected outcomes. This promotes accountability and makes it easier for
supervisors to evaluate employee contributions. In a well-managed warehouse,
everyone, from drivers to loaders, must follow SOPs precisely to maintain
workflow continuity. Suggested SOPs might include order picking, packing, put-away,
replenishment, receiving, cycle counting, inventory audits, and cleaning
procedures. Clear documentation ensures all staff understand their roles and
responsibilities.
The proper implementation of SOPs not only
improves efficiency but also reduces the risk of accidents and errors. These
procedures streamline communication and task execution, particularly in
fast-paced environments. As employees gain confidence following SOPs, the
overall effectiveness of warehouse operations improves. Periodic reviews ensure
that SOPs remain current and aligned with evolving operational requirements,
thereby reinforcing consistency and adherence to best practices.
Developing Standard
Operating Procedures for Efficiency
Creating effective SOPs starts with a thorough
task analysis. Warehouse managers should document each step of a given task,
identifying essential actions and decision points. Observing employees as they
perform the task and consulting with them provides practical insights as well
as securing buy-in from staff to follow the SOP when finalised. This ensures
that SOPs reflect on-the-ground realities, promoting usability and completeness
in their final format.
Choosing the correct format for SOPs is the
next critical step. Depending on the task complexity and visual requirements,
formats can include checklists, reference cards, written guides, or visual aids
such as diagrams. Short tasks may need only a checklist, while longer or
detailed activities may benefit from written instructions or flowcharts. The
key is selecting a format that employees can easily follow while performing
their duties.
Once SOPs are developed, validation is
essential. Reviewing SOPs with frontline workers ensures clarity and accuracy.
Regular reviews help update SOPs in line with procedural changes or new
equipment. This ongoing review process reinforces operational consistency and
ensures SOPs remain relevant. By integrating user feedback, SOPs become living
documents that evolve in tandem with warehouse needs and employee practices.
Real-time
Data Tracking
Real-time data tracking is crucial to modern
supply chain operations, enabling more informed decision-making and increased
efficiency. With globalised sourcing and distributed manufacturing, companies
rely on accurate, live information to manage goods from production to delivery.
Monitoring warehouse activity in real time supports faster adjustments,
improved productivity, and more consistent service levels, which are essential
to remaining competitive in a global marketplace.
Technologies such as barcodes and RFID tags
streamline inventory management by automating data collection and tracking.
RFID allows for hands-free identification of goods, minimising errors in
receiving, picking, and shipping. It enables companies to track specific
shipments and address issues promptly if problems arise. By capturing movement
data without manual input, warehouses can eliminate human error, improve
inventory visibility, and ensure the right products reach the right
destinations efficiently.
The benefits of real-time tracking also extend
to performance analysis. Managers gain deeper insight into warehouse operations
and can detect process inefficiencies before they escalate. For example,
identifying delays in restocking or unusual pick rates can prompt immediate
investigation and correction. With real-time tracking integrated into broader
management systems, warehouses operate with greater agility, speed, and
accuracy, thereby reducing costs and enhancing customer service outcomes.
Implementing
Tracking Technologies
Tracking technologies vary in complexity,
ranging from QR codes to RFID and GPS systems. QR codes, which are inexpensive
and easy to implement, can be scanned using smartphones or tablets and linked
to storage databases. While less advanced than complete warehouse management
systems, QR applications are sufficient for small operations, providing a
low-cost entry point to digital tracking with minimal disruption to existing
procedures.
RFID provides a more robust tracking solution
for larger and more complex warehouses. Tags are affixed to goods and storage
locations and read automatically by strategically placed sensors. This system
reduces manual scanning tasks and improves the accuracy of stock movements.
RFID also lowers labour costs and increases processing speed, as tagging is
done once and used throughout the product lifecycle, improving traceability and
minimising inventory discrepancies.
Implementation requires thoughtful planning.
Adequate infrastructure, including readers, data processing software, and
trained personnel, is essential for a successful rollout. Companies must also
adapt their standard procedures to integrate tracking smoothly. Although
initial investment and setup can be substantial, the long-term gains in
efficiency, accountability, and inventory accuracy provide a strong return on
investment, making tracking technologies a worthwhile enhancement for most
warehouse operations.
Analysing
Real-time Data for Decision Making
Real-time data analysis enables intelligent
decision-making in warehouse environments. By integrating AI and logic-driven
systems, data can be transformed into actionable insights. These systems
monitor operational patterns and identify deviations, such as equipment wear,
unusual order flows, or process slowdowns, prompting timely interventions to
address these issues. Alerts and automated actions help minimise disruption and
maintain optimal performance levels across all warehouse functions.
For instance, sensors can detect faults in
conveyor belts or forklifts, allowing pre-emptive maintenance that avoids
costly breakdowns. Similarly, data can highlight inefficiencies, such as low
pick rates or bottlenecks, which might otherwise go unnoticed. These insights
allow managers to reallocate resources or adjust workflows immediately. The
ability to act quickly based on accurate data creates a more responsive and
resilient warehouse.
Ultimately, using data effectively depends on
asking the right operational questions and designing systems to gather
meaningful insights. Categorising indicators by importance ensures attention is
focused where it matters most. Whether improving stock turnover, reducing
downtime, or safeguarding health and safety, data analysis provides the tools
to refine processes continuously. In a competitive logistics environment,
innovative use of real-time data gives warehouses the edge they need to
succeed.
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