When it comes to managing warehouse expenses and overhead, too many people default to cutting workforce & labor instead of looking elsewhere.

Cutting labor can lead to big problems down the road if business starts to ramp up, not to mention disrupting the lives of your former employees getting displaced.

Instead of looking to your staff to cut overhead, there’s a number of commonly-overlooked expenses that can be cut or reduced to pare down your operating costs without having to sacrifice workforce. These include:

 

Optimized storage: One of the biggest sacrifices of both money and time is when workers need additional time or longer hours to find items and get everything picked. By reorganizing and optimizing your warehouse shelving and pallet racks to help focus on the most popular/frequently picked items, you can boost productivity and help your staff leave on time, which everyone will be grateful for. Make sure your products are properly bar-coded and don’t be afraid to move products around the warehouse into different areas to help your staff get to them more easily.

 

Make your warehouse more energy efficient: Where possible, as time and money allow, consider upgrading to more efficient utilities throughout the warehouse. Switch out your lights for industrial LED lighting that lasts longer and has less of an impact on your energy bill, and clear and replace vents as needed. You can also try to reduce travel time between different areas by stocking your shipping areas with all the supplies workers need to pack and mail out products. This will stop them from needing to use the lights or heating in too many unattached rooms.

 

Reduce paper where possible: Similarly, a lot of warehouses still rely on paper goods and bills to track inventory or process incoming shipment. While this may not be an option for every vendor and every department, moving to tablets and mobile devices to track items and store data will help you spend less money on printer paper and hard-copies of your inventory, which will reduce costs and improve your overall economic impact.

 

Implement cross-docking: If the design of your warehouse allows it, cross-docking can help save time and money in many cases. For items that tend to move much quicker or have shorter lead times from vendors, implementing just-in-time (JIT) ordering and cross-docking directly from the vendor can save time and reduce inventory storage costs, all while helping your staff get products out even faster.

 

Reducing disposal/waste charges: Wherever possible, use environmentally friendly cleaning products on your shelves and in your offices & breakrooms. These products are easier to dispose of, and may be recyclable in many cases, allowing for you to save money on waste management while providing a more environmentally-friendly face to your customers and prospective clients.

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