Warehouse optimization with order picking: 5 steps to more productivity with optimized order picking

Konrad Wolfenstein

3 years ago

Warehouse optimization with order picking – Image: Nejron Photo|Shutterstock.com

The list of adjustments that companies use to increase productivity and at the same time their competitive position and profits is long. Especially in intralogistics, there is often still the opportunity to leverage dormant potential and warehouse optimization .

Investments in automated storage systems such as horizontal carousels or vertical lift systems can help, as they lead to higher productivity and ultimately increasing profits due to the significant time savings in providing the goods. In addition, the systems save valuable storage space due to their high-density capacities and are designed to be more ergonomic due to the goods-to-person delivery principle, which has a positive effect on the health of employees and reduces absenteeism. The picking accuracy of modern, software-controlled systems is also many times higher, which results in lower costs from errors in order picking.

Below, five questions are intended to help companies review their order picking processes with regard to opportunities for improvement:

How much work is involved in order picking?
How high is the utilization of the existing storage space?
Is the picking process fast enough to meet growing requirements?
What are the costs of worker absenteeism?
How much do incorrect accesses in order picking cost?

Suitable for:

Intralogistics: Calculate average storage duration

1. Reduction in labor costs

Order picking is more than just taking the goods off the shelf. In manual operation, it means that the employee makes his way through the warehouse with a pick list or a mobile hand scanner and collects the required goods one after the other before returning to the picking station. In addition to the length of the pick list, the duration of the operation depends on the size of the warehouse and the arrangement of the items to be picked up. Due to the sometimes very long distances and the chaotic arrangement of the stored goods, the picking process is often referred to as the most labor-intensive area of warehouse logistics, accounting for up to 55% of the total storage costs. The time spent processing orders is also known as travel time, which according to studies accounts for between 60 and 65% of employees' working hours. By converting to modern storage systems, this travel time can be significantly reduced, as the devices automatically identify the goods on their shelves and transport them directly to the picking station, where the employees only have to pick them up and process them. The delays that otherwise occur again and again, caused by the search for the items, are also eliminated here. The software control of the machines also allows processes to be optimized based on the specific spatial conditions, which further minimizes the time required.

In addition to the considerable savings in terms of time, the modernization eliminates work steps, which further increases productivity: Since the systems only manage with a third of the previously required workforce due to the no longer need for “ongoing staff”, these positions can be saved and the employees can be used in other areas, which also increases effectiveness there. Larger storage quantities can be managed with the same number of staff.

2. Reduction in storage space

In contrast to the limited height of classic shelving, which always has to be based on the handle height of the picker, modern storage systems make it possible to make optimal use of the available room heights. Thanks to their variable dimensions, they can easily be erected ten meters or higher, which automatically leads to significant space savings. In addition, these solutions save the space otherwise reserved for the aisles between the shelves.

Intelligent software control can also help reduce the space required by storing the goods in the optimal locations depending on their size and weight, where they hardly waste any free space upwards or to the sides. This minimizes unnecessary open spaces.

According to estimates, up to 70% of the existing storage volume is wasted due to inadequate utilization of conventional shelving units. A value that is reduced to around 20% in modern systems for the reasons listed. The space saved in this way can then be used either to store additional goods or for other purposes.

3. Reducing picking costs

With manual picking, employees can only process the orders one after the other. fast-moving , frequently requested items are stored) several times during the shift In comparison, software-controlled models allow the creation of collective orders (so-called batches ), in which individual items are retrieved from the warehouse and temporarily stored for several orders. Unnecessary waiting times are eliminated and collective orders can be processed more quickly, meaning batch picking saves valuable time.

If necessary, the batches can be sorted and completed according to additional criteria (such as the urgency of the order) in addition to the original order, which increases the flexibility and thus competitiveness of the company.

4. Reduced absenteeism

Picking on shelving requires a lot from employees; When picking up the items, they have to constantly bend or stretch in order to collect the goods, which are sometimes not easy. Added to this are the long distances of sometimes 20 kilometers or more per shift that the employees have to cover. It is not surprising that this strenuous work takes a toll on the health of employees. Research into workplace ergonomics has shown that these efforts can be minimized if the warehouse worker picks up the goods in a golden zone . This is located approximately between hip and shoulder height, which means that movements that put strain on the spine and joints, such as constant bending and stretching, are almost impossible. Of course, it would be an enormous waste of space to only fill the shelves in these rooms. However, automated storage systems that deliver the goods to the picking point can easily meet this requirement, as the items are taken from removal openings that can be optimally adjusted in height or are delivered via conveyor belts. The reduction of unergonomic loads in automated shelving systems leads directly to reduced staff absences due to work-related illnesses such as back pain or joint pain. The systems also have sophisticated control mechanisms (security gates, emergency stop buttons, sensors) that increase the safety of employees at work and stop production immediately in the event of an alarm.

Another positive aspect is that walking distances are almost completely eliminated, which means that employees do not get too tired and can therefore work more productively.

5. Increase picking accuracy

In addition to saving on labor and storage space, order picking accuracy is another crucial factor when it comes to reducing costs. Picking errors not only cost time, but also money; caused by the time-consuming return transport, inspection and re-storage of the item as well as the re-shipment of the correct item. According to a survey of 250 logistics managers in Europe and the USA, their individual warehouses suffer annual losses of an average of almost 300,000 euros due to incorrect access when retrieving goods.

When warehouses and distribution centers operate with picking accuracies of 99%, that may seem relatively high. But if this one percent leads to losses of 300,000 euros, a further reduction in incorrect access is worth money. Modern, automated horizontal or vertical warehouses now achieve picking accuracies of up to 99.9% due to their software-supported control mechanisms (e.g. retrieval of goods via laser scanners and pick-by-light systems), which reduces losses by 90%. Where inaccuracies previously generated deficits of 300,000 euros, only around 30,000 euros remain in costs - a still significant sum, but no comparison to the amounts previously incurred.

In conclusion, it can be summarized that aligning your own warehouse strategy based on the five points listed leads to a significant increase in productivity and competitiveness. This is the higher the larger the respective warehouse and its throughput volume. It is therefore advisable to convert to the use of modern storage systems, especially in larger systems, as this is where the greatest improvements in warehouse productivity and the cost situation are achieved.

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Xpert.Plus is a project from Xpert.Digital. We have many years of experience in supporting and advising on storage solutions and in logistics optimization, which we bundle in a large network Xpert.Plus

Konrad Wolfenstein

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