How to Create an Effective Warehouse Slotting Process

Warehouse slotting is the process of organizing inventory in a warehouse or distribution center. Typically, successful warehouse slotting maximizes the storage capacity of a warehouse through more efficient storage and picking, while reducing handling costs. This is accomplished by optimizing inventory location within your facility in relation to personnel and other factors.

While many believe that their current processes are doing just fine, it is important to be aware of the added benefits that come with evaluating and transforming them by utilizing proper slotting strategies to improve your warehouse’s order fulfillment operations and performance.

What Are The Benefits of Effective Slotting?

In addition to saving space within a facility, efficient slotting methods allow for fewer workers to pick more orders more efficiently, ultimately reducing labor costs . Walking miles from product to product to pick orders is one of the most time-consuming parts of the entire order picking process, which can account for up to 60 percent of a worker’s time and is a clear symptom of random or poor slotting strategies. Slotting your products in a more efficient manner can help to drastically reduce travel time, making your workers more productive and increasing labor efficiency.

This change alone is enough to drastically improve productivity and organization as well. To successfully run order fulfillment operations, it is crucial to have organized various product lines down to the detail so that your workers know the types of items they are searching for and where to find them. Creating this effective inventory storage system allows for each individual item to have a place

Free Guide: Top Order Fulfillment KPI Indicators

Efficient slotting also makes product replenishment and inventory management easier, increases order accuracy, and has the potential to dramatically improve the ergonomics and workflows of a facility.

Why Slotting Is Important

Often, when an operation is seeking to make a warehouse or facility more efficient and productive, they begin by evaluating their current slotting process and determining whether or not improvements or optimizations can be made. A simple adjustment to process or implementation of new technology could have major benefits. Ultimately, a successful fulfillment process includes an organized and efficient order of operations that will not only increase order accuracy but will also increase productivity levels for the entire warehouse.

What are the Main Goals of Slotting?

The purpose of slotting is to ensure the following:

• Products are assigned to the most appropriate storage medium or technology available. .
• Products are assigned to pick locations throughout the warehouse to optimize total labor efficiency including order picking, putaway, and replenishment labor functions.

How do you create slotting efficiency?

• When commonly picked, SKUs are located near each other
• A-movers (highly active) are located in the ergonomic golden zone for fast picking
• The fast movers are located closer to picking and the slow movers are moved further away
• A SKUs picking and replenishment velocity determines the proper technology or equipment being utilized. For example, if you are picking cases of a SKU per day, it should be in a flow rack or automated technology. Very slow movers can be moved to shelving further away from picking

Through this method, your order fulfillment operations will see significant benefits that affect storage capacity and create an accurate process. Some of the benefits you can expect for your warehouse include the following

• Reducing labor
• Saving floor space that can be used to store more inventory, increase value added services, increase product lines, eliminate the need to expand or move
• Improving inventory visibility
• Reducing the amount of capital dedicated to product handling
• Ensuring that inventory is appropriately spread throughout your facility, reducing bottlenecks
• Decreasing human error in the fulfillment process
• Improving the accuracy of your picking process

The Right Information Makes Warehouse Slotting Easier

If you are planning to build a new warehouse facility or updating your existing facility, you will want to devote some time to your slotting strategy to make sure that it is as efficient as possible. Often, this will be done in collaboration with a warehouse design consultant or systems integrator, who can help you identify inefficiencies in your current system.

Before sitting down with your warehouse design consultant or systems integrator, it will be important to have the right information gathered together, which will help contextualize your needs and regular operating procedures. In addition to painting a picture of how your operation works, this will also save you time and money.

Some of the most important data to bring to the conversation includes:

• Order History, which will help spot trends in inventory such as:
  • The fastest moving items vs. the slowest moving items
  • Season changes in order composition
  • Product affinity (which items are shipped together most often)
• SKU data and Item Master data, which will inform storage requirements and warehouse layout
• The level at which the item will be picked (single piece, case, full pallet) and the storage medium the item will be picked from (pallet rack, shelf, carton), which will inform layout, storage requirements, and pick a strategy

In addition to this data, your warehouse design consultant or systems integrator will need to know about the nature of your order queuing, which will impact the slotting strategy ultimately implemented in your facility. For example, if your facility handles a lot of same-day shipments, it is incredibly important that products are slotted and replenished correctly and in a timely manner to facilitate faster pick rates.

On the other hand, if your facility does not typically have to deal with the crunch of same-day shipping paired with later order cut off times, an overnight reslotting strategy may be adequate. Given the opportunity to do so, many goods-to-person systems can re-slot totes overnight, arranging them in an optimal configuration for the coming day’s orders. The reslotting of new or promotional items is critical as customers demand faster and faster delivery options from e-commerce and are imperative to aligning operations with customer expectations.

Also worth noting are any exemptions or asterisks in your item master. If there is anything in your product handling, storage, or order fulfillment workflows that isn’t reflected in the data, but could impact design, it is good to tell the warehouse design consultant.

Optimize Your Warehouse Slotting Strategy

Creating an adequate warehouse slotting system is critical in today’s world of order processing. In addition to maximizing space and reducing labor and other costs, implementing a slotting program has the potential to dramatically increase your facility’s productivity by reducing order cycle times and boosting output. Though slotting by nature requires a lot of analysis if it is to be done correctly, quality warehouse design consultant or systems integrator will help you achieve the best possible results for your operation.