Effective Warehouse Management for E-commerce: 12 Essential Tips

13 min read
Bitrix24 Team
May 23, 2023
Last updated: January 17, 2024
Effective Warehouse Management for E-commerce: 12 Essential Tips

Managing stock inventory for an e-commerce business is not too different from managing inventory in a retail store. They both have the same end goal: flawless and timely order fulfillment. Because of this, warehousing plays a crucial role in helping the business meet customer expectations. This is where reliable and sure warehouse management comes into play. 

It might seem like a detail that can be worked out later, but responsible inventory management and efficient warehousing is what can keep businesses around for a long time to come. If longevity for your business takes precedence for you, read on. We have a lot of useful tips for you to help you with warehouse management and inventory management for your e-commerce business.  


1. Make safety a top priority

While it’s true that accidents can happen in the workplace, any good warehouse manager knows that steps can be taken and things can be done to make certain they’re lessened, if not altogether avoided. Warehouse staff not only face the risk of slips and falls, but also the possibility of suffering from physical strain, resulting in lower back pain, pulled muscles, or pinched nerves. 

Warehouse managers need to be vigilant and eliminate the risks as much as possible. Invest in equipment that can help employees do their jobs efficiently but safely, and scope out areas in the warehouse where people can get hurt. Staff should also be trained to always be professional when inside the warehouse and avoid dangerous behaviors. 


2. Prioritize inventory control and accuracy

Inventory management is key to effective and efficient warehouse management. If you’re unable to keep track of stock flows and demands correctly, you can end up with too much product or none at all. Employ an inventory reporting system that gives you an accurate picture of your stock count at regular intervals during the day. Doing this allows you to respond to dips and peaks in orders as they come in. 

If you already have an inventory reporting system in place, make regular reviews and accuracy check part of your routine. It’s never too late to overhaul what you currently have. You can also adopt a new system or purchase a new product stock management software. 


3. Optimize efficiency by keeping your warehouse organized

An organized warehouse is not only a breeze to navigate. It also makes work a lot quicker to get done, the workplace safer, and the tasks themselves a lot easier to accomplish. If a warehouse is cluttered, it is not only a place where accidents are waiting to happen. It also makes work more tedious, costly, and time-consuming. 

Start by using the ABC analysis for organization and inventory management. It’s a method used by most businesses to put into place a hierarchal order to the products in their warehouse. Here’s how it works: 

  • A-level items – High-value items, the best sellers, or more expensive items that are also in high demand. These are the items that warehouse staff always reach for. A-level items typically have a special place in storage where they are kept safe but accessible. 

  • B-level items – Moderate value items. They also sell but they do not sell as well as the A-level products. The warehouse may have more of these items since, for customers, they are priced sensibly and highly useful or appealing. B-level items are stored in high-traffic areas where they are well within the reach of pickers since they are favored most of the time. 

  • C-level items – Low-value items, therefore requiring minimum inventory control. These items also sell, given the price, but not so much because they’re needed or essential. These are also part of the inventory sometimes given away as freebies to big purchasers or loyal customers. 

After categorizing products, use labelling systems to better sort everything that you have in your inventory. These labelling systems or inventory tags are stickers put on products before they’re stored away. The said tags contain codes as a means to identify an item, its details and other related information. Choose among the following labelling or tagging systems: 

  • Barcode tags – One-dimensional codes that contain inventory ID, price, etc., which are readable using a barcode scanner. Barcodes are easy to use and cost-effective as well

  • QR codes – Two-dimensional codes that can either be read using a scanner or a mobile device. This system can be used on any product and every platform available

  • RFID tags – Best for scanning dozens of items at one time. RFID tags can be integrated with sensors and GPS technology for added security

Once you’re done categorizing and labelling items until finally storing them away, clear up the aisles and make sure there is enough space to allow employees to go back and forth safely, even while bearing a load of items to pack. Keep shelving units evenly spaced and loaded, again with safety as a priority. 

Other tips that you can employ to get everything in the warehouse in order are: 

  • Use stackable bins and trays 

  • Practice first in, first out 

  • Utilize vertical spaces for extra storage 

  • Exercise the clean-as-you-go policy


4. Audit regularly and get your team’s input

If you already have a warehouse management and inventory management protocol in place, make periodic reviews and audits a part of your cycle. As times change, your business needs may change along with the demands for your products. It only makes sense to also conduct regular checks on equipment and fixtures to see if they’re still up to the task. 

Tap into a wealth of resources by consulting your employees for their input and recommendations. Since they’re the ones who work in the trenches, so to speak, you can trust that they have a good grasp of what’s needed and what’s important. Get your team together and go over everything – from stocks to equipment to processes and procedures – until you come up with a plan to further improve how the warehouse is run and used. 


5. Create zones and think about flow and traffic patterns

Warehouse management works hand-in-hand with inventory management in ensuring that products flow at an even pace from the warehouse itself from receiving, storage, packing and, finally, shipping. Arrange the layout of the land to separate sections to delineate one process from the others, defining a workflow for the entire warehouse. These sections allow for adequate space for the below:

  • Receiving – This is the area where incoming stocks are unloaded, quality checks are carried out, and products are labelled before their wheeled into the storage zone. 

  • Stockroom – Filled with storage racks, the stockroom is where the warehouse inventory is mostly kept, organized by category, and properly labelled. 

  • Picking and packing – Usually filled with racks, picking baskets, and sorting tables, this area of the warehouse is where items picked from racks and shelves are laid out before they are packed into parcels as ordered by customers. 

  • Dispatching – Cartons and packets of packed orders are stacked here. Shipping labels and other documentation are then printed out and either stuck on the parcels or stuck in the packages themselves before they are turned over to shipping partners. 

  • Forwarding – Packed orders are relinquished to couriers in batches depending on the areas where they are scheduled to be delivered.


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6. Make room for receiving

Another section that you should allot space for in the warehouse is for receiving RTS (return to sender) parcels as well as defective and surplus stocks. There, you can decide to either return these stocks to the inventory or set them aside for other purposes. 

Your receiving area should be spacious enough to allow for the ability to receive shipments of various shapes and sizes. The designated receiving sector of your warehouse is where each and every incoming item is properly documented, tagged, logged, and stored for whatever future purpose they may serve. 


7. Acquire much-needed equipment

Now that you’ve mapped out the sections of your warehouse and laid out the floor plans, it’s time to acquire much-needed equipment or survey the ones that you already have to decide whether or not your warehouse needs an equipment overhaul. As your business grows, progress also calls for upgrades in your tools and hardware. 

These may involve the purchase of the following apparatuses: 

  • Storage equipment such as shelves, racks, bins, and baskets to help manage stocks in e-commerce

  • Packaging and shipping equipment which includes everything from labelling, assembling, and packing

  • Inventory management appliances like barcode scanners, RFID tag installers, printers, and the like

  • Handling equipment that’s everything you and your warehouse staff may need for storing, positioning, and loading inventory


8. Use technology to your advantage

Warehouse management and inventory management systems can benefit greatly from eliminating paper-based procedures and data entry. This reduces delays and the risk of errors by affording your warehouse the latest accurate data, helping warehouse staff and leaders to focus on efficiency, accuracy, and productivity

By going digital, there is little room for missing documents or erroneous information. With a digital product stock management software, employees can be well-equipped to manage stock inventory. Software and digital platforms also allow businesses in cutting costs, funneling budget that is otherwise spent on paper and writing supplies. Ditching paper and going digital also makes more sense if you are managing a sizeable warehouse. 


9. Choose the right inventory management and product stock management software

Learning how to manage inventory in a retail store, especially for a warehouse of a considerable size, can take a lot of focus, time, and effort. At the same time, a warehouse needs to be confident in its capabilities to meet customer needs and demands, especially during busy retail periods. It’s only practical to procure a reliable and robust inventory management system along with a product stock management software. 

You need a software that automatically documents stock receipts and correctly feeds the information into the system, automating the process. A dependable system such as this gives warehouse managers more control over inventory and the warehouse as a whole. Employing such an intelligent system guarantees that there will be fewer shortages and surpluses as well as loss of business due to errors either at the point of sale or order placement. 


10. Select the right picking method for effective warehouse management

Picking strategies assures a warehouse is running smoothly during both low and high-demand seasons. Applying an agile approach eliminates labor and stock shortages. Bringing software-driven processes into play can make warehouse conditions more flexible as sales ebb and flow without the employees having to scramble to meet demands. 

As much as one might like, there is not one perfect picking method for all. The size of the warehouse operation can be found suited to one of the following approaches: 

  • Single order picking – The most common fulfillment method, while also being the most time-consuming, single order picking means the picker works on one order at a time, going back and forth multiple times within a given shift.

  • Batch order picking – Otherwise known as multi-order picking, this method means that pickers work on multiple orders at the same time. This method works best for warehouses or e-commerce stores that have a high demand for the same SKU in more than one order.    

  • Pick and pass – The warehouse is divided into zones, with one picker assigned to a zone in this method. Bins and containers are passed along from one zone to another until an order is completely fulfilled.

  • Zone order picking – Often combined with the pick and pass method, zone order picking works best for high-volume warehouses that often encounter bottlenecks in certain areas. 

  • Cluster order picking – This method allows pickers to work on multiple orders at the same time. Picking carts or mobile robots help in making the process more manageable. 

  • Wave order picking – Instead of picking in one zone and having bins and containers passed from one zone to another, the wave order picking method allows all zones to be picked from at the same time. The items are then sorted and combined into their respective shipments. 

Picking methods should be evaluated regularly to ascertain that they are still the best option based on the warehouse size and customer demand. 


11. Prioritize replenishment of popular items and lean inventory strategies

Work stoppages, warehouse downtimes and rush supply orders can be costly for a business. Managers need to stay at least two steps ahead of inventory movements by keeping a close eye on product popularity and stock movements. Being able to anticipate items selling out prevents shortages and keeps the warehouse machinations working full-time. 

Lean inventory strategies or stocking smaller quantities of products that are in demand cuts picking and packing times short while also making warehouse operations more agile. Keep a close eye on bestsellers and market conditions to be able to make sound judgments on ordering from suppliers and avoid surplus and waste. 


12. Manage stock in e-commerce better by repurposing dead stock

Don’t be too quick to dispose of or turn your nose up on dead stocks or stocks that you no longer expect to sell. Getting rid of this part of any inventory can be costly since you will be essentially wasting money. Take an inventory of your dead stock, such as discontinued styles, returned parcels, and other surplus stock, and set them aside for future use. Part of learning how to manage stock inventory includes knowing what to do with items a company no longer expects to sell. 

Dead stock can be used as free gifts if there is a customer who ordered many items and you want to show them they’re appreciated. Partnering with other companies is also another option to help dispose of dead stock. Or if employees also happen to be great fans of your products, dead stock can be allotted as giveaways to staff and other employees. 


Taking stock of warehouse management and inventory management

More and more customers are choosing to shop online nowadays, making the e-commerce market as competitive as ever. With the influx of customers and orders also come everchanging trends, a sound warehouse management and inventory management in e-commerce will guarantee a business is able to answer customer demands, regardless of the season.

Finding the right warehouse management team and assembling a strong team is half the battle. The rest is won with the procurement of the best inventory management system and product stock management software proportionate to the size of the warehouse. 

If you're looking for a complete warehouse management solution that can seamlessly integrate with your e-commerce, sign up for Bitrix24 today!


FAQs

What is e-commerce warehousing?

E-commerce warehousing is the method of storing products that will categorically be sold online. That being said, e-commerce warehouse management covers many other processes, such as: 

  • Managing warehouse employees
  • Keeping track of warehouse equipment
  • Inventory management
  • Product safety and security
  • Process monitoring
  • Liaising with shipping carriers
  • Observing demands forecasts to ensure stocks are always enough
  • Maintaining safety practices to protect staff, products, and equipment

Why is e-commerce warehousing important?

E-commerce warehousing is important because it helps business owners improve the accuracy of inventory monitoring and tracking, preventing shortages as well as lost items or wasted stocks. With effective e-commerce warehousing systems, businesses can also: 

  • Choose between renting or purchasing a warehouse property 
  • Invest in equipment, more staff, technology, and shipping supplies
  • Adopt new sales channels 
  • Expand to multichannel inventory management capacities
  • Open more fulfillment centers to cut down on transit times 
  • Become a global brand

What is warehouse management?

Warehouse management is the logistic process that involves overseeing, managing, and controlling the daily operations within a warehouse. This may include:

  • Hiring, training, and managing warehouse staff
  • Equipment maintenance 
  • Inventory tracking 
  • Order fulfillment

What are the benefits of using an e-commerce warehouse management system?

By using an e-commerce warehouse management system, businesses can enjoy the following benefits: 

  • Reliable inventory management 
  • Reduced cost all around
  • Accurate picking and packing, as well as order fulfillment

How to choose an e-commerce warehouse management system?

Choose a warehouse management system that meets some, if not all, of the following criteria:

  • Easy to use - Complicated systems or setups can waste precious time
  • Integration – Pick a warehouse management system that can easily integrate with your existing software, including your product stock management or inventory management software. 
  • Flexible – Businesses grow and change over time, so choose a warehouse management system or software that’s flexible enough to move with the changes in your business. 
  • Return on investment – The right warehouse management helps businesses cut costs and maximize profits, while the wrong one can take away from profits. 
  • Accuracy – Always request a demo from a vendor to find out if what you have your eye on is accurate
  • Accessibility – Will the system be able to provide you with real-time data anytime you need it? Will you be able to access everything, even from your phone?

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Table of Content
1. Make safety a top priority 2. Prioritize inventory control and accuracy 3. Optimize efficiency 4. Audit regularly 5. Create zones 6. Make room for receiving 7. Acquire much-needed equipment 8. Use technology 9. Choose the right software 10. Select the right picking method 11. Prioritize replenishment 12. Manage stock in e-commerce better Taking stock of warehouse and inventory management FAQs What is e-commerce warehousing? Why is e-commerce warehousing important? What is warehouse management? What are the benefits of using an e-commerce warehouse management system? How to choose an e-commerce warehouse management system?
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