How to Prepare Your Warehouse for a Recession

After a devastating few years, many manufacturing businesses are still in the process of finding their footing. Unfortunately, they may not have much longer to focus on recalibrating.

Talking to CNBC, former Federal Reserve vice-chair Alan Blinder estimated a “50% – 60% chance of a recession” in the upcoming year. And he’s not the only one who believes this. Bloomberg also reported a 30% chance just a few weeks before, meaning the likelihood of a recession is growing.

Even if experts anticipate it being mild, manufacturers can’t afford to be caught off-guard by another economic shakeup. Companies that proved resilient during 2020 were already adapting to new industry trends. And in many cases, they were already implementing several of the steps we’ve outlined below. These include a mix of changes on your facility’s floor and the technology you can use to your advantage.

Performance Analytics 

This may fall slightly outside of everyday business practices for warehouse leaders and managers. But tracking performance analytics has become necessary to understand your warehouse’s (and company’s!) success.

Performance analytics don’t stop at inventory updates, although those are certainly very helpful. By checking your warehouse analytics, you can better see your overall warehouse process’s effectiveness.

For example, there could be breakdowns in your process that are hurting your employees’ productivity, wasting both time and money. By checking performance analytics, you have the chance to identify and address these obstacles. This way, you are decreasing the likelihood of minor issues growing into catastrophic problems, leading to consequences like product damage or, even worse, employee injuries.

Important performance analytics that are worth your attention include:

  • Picking and packing productivity
  • Order accuracy rate
  • Order lead time
  • Time to ship
  • Performance of on-time shipments
  • Undamaged delivery date

With so much competition on the market and the looming recession, warehouses that aren’t using performance analytics will quickly fall behind.

Track and Maintain Inventory Levels 

Don’t get stuck with either not enough or too much inventory. Either of these can severely hurt your chances of successfully pulling through a recession. A lack of products can cause a wave of negative impacts, from angry customers to lost revenue. Conversely, an excess can lead to wasted storage space, lost items and your cash tied up in inventory.

As we discussed above, performance analytics are crucial to keeping your warehouse on track. One of the best metrics to monitor is how much inventory is coming in and out of your facility. This includes customer demands, which will help your team decide on an optimized storage system and picking process. For example, your analytics can help identify your most popular products and related trends. This data can dictate how your storage systems should be organized, keeping these high-traffic products near your picking area.

More than keeping track of how many products are leaving your facility, you can also observe how many items are being returned or canceled. These additional insights can increase the accuracy of your inventory orders.

Technology Tools

If you’re ready to start tracking performance analytics, you will need a few tools.

Warehouse management systems are software platforms that allow warehouses to manage operations from when materials arrive until they are shipped out. With WMS software, you can centralize your performance analytics. It will enable you to organize your orders, manage invoices, improve shipping efficiency and more. More broadly, you can use a WMS to review your overall warehouse process, point out areas of inefficiency and streamline your operations.

Additionally, WMS help warehouses stay scalable. They can provide a comprehensive look at your performance, letting you track whether it’s time to downsize or level up. With WMS analytics, you can make a data-driven decision about scaling your business.

Beyond WMS, there are additional devices that will boost your productivity and make you less likely to fall behind during a recession.

Voice technology can significantly improve communication among team members and warehouse managers. It allows team members on the floor to quickly get in touch with managers by using tools like microphones, headsets and wireless computers.

Additionally, mobile picking technology allows employees to quickly and efficiently scan shipping labels, manage inventory and update picklists from anywhere.

Reducing Waste

In this case, reducing waste doesn’t mean cutting down on paper processes or using a recycling bin. Reducing waste in your warehouse refers to cutting down on the practices that are wasting energy, time and money.

By cutting the fat, so to speak, you can focus on the actions that are crucial to your warehouse’s success instead of wasting time handling the obstacles presented by unhelpful practices.

Now, as we’re facing a recession, there’s no better time to explore lean and cellular manufacturing:

  • Lean Manufacturing: Lean manufacturing is designed to eliminate waste in manufacturing warehouses, which can be defined in terms of time, inventory and cost. Its goal is to maximize productivity and quality.
  • Cellular ManufacturingCellular manufacturing offers increased efficiency and control over production. Rather than processing multiple parts before sending them on to the next machine, cellular manufacturing aims to move products through the manufacturing process one piece at a time, determined by customers’ needs.

 

Sustainable, Durable Tools

Just as important as devices and tracking systems are your material handlers’ durability and adaptability. Material handlers like industrial manipulators are ideal for saving time and energy (and repair costs when using a high-quality device), which are crucial resources when battling a recession. And while lifting devices could be a considerable investment in the short term, their performance capabilities are proven to save your business money in the long run. 

Industrial manipulators are frequently used when:

  • A product is too heavy for a person to move manually
  • A product must be moved to a location that is not easily or quickly accessible for a person to reach, like a very tall shelf
  • A person will be put at risk for injury if they move a product manually
  • A person will quickly fatigue from moving products manually
  • A high volume of product must be moved in a timely fashion

At Dalmec, our reliable, long-lasting industrial manipulators are designed to withstand the demands of your manufacturing facility, even as processes change due to a recession. We’re even able to build you a customized device to fit your needs and streamline your operations for years to come.

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