BusinessStreamlining Supply Chain: Benefits Of Optimal Warehousing Practices

Streamlining Supply Chain: Benefits Of Optimal Warehousing Practices

Warehousing is the distribution of products or materials outside their original place of manufacture or storage. Suppliers, manufacturers, and retailers use warehouses to store their products until they can be distributed to retail stores, sold wholesale, or transported to manufacturing plants for further processing. That’s why the warehousing and storage industry is projected to reach $1264.01 Billion by 2030.

Even cross-country transport requires the use of warehouses. Specialized, bonded warehouses help ensure that goods entering the country are adequately declared, taxed, and cleared by customs officials. According to a government website, there are nine different types or classes of Customs bonded warehouses authorized by Customs and Border Protection (CBP).

The following article explains how warehouse optimization can benefit your supply chain operations:

How to Ensure Optimal Warehousing

Optimal warehousing is a process that can help your supply chain run more smoothly and efficiently. It involves using the right amount of space for each product so that you don’t have too much or too little inventory at any given time.

This ensures that your company doesn’t have to waste time moving products around in warehouses, which would slow down the entire process and could lead to mistakes by employees handling the goods.

To ensure optimal warehousing practices are implemented in your facility:

  • Ensure proper storage conditions for each type of product stored within your facility
  • Calculate proper stocking levels based on historical sales data or demand forecasts

Since handling all these optimizing tasks requires expertise, it is best to outsource warehouse services. Outsourcing will get you many benefits, like not having to worry about maintaining the warehouse or recruiting labor to operate it, etc. You can seek help from companies offering warehouse services in your locality and have a distributed delivery system.

These warehouse service providers also have large spaces where they can manage your products and items efficiently. For instance, WBIR recently posted that Red Stag Fulfillment acquired a 420-acre site in Sweetwater. Such massive spaces are enough to store and manage your items.

Benefits of Optimal Warehousing

Warehousing is crucial in the supply chain, and almost every business can benefit from optimizing it. Here are some common benefits of optimal warehousing.

Improved Visibility into Inventory

Inventory visibility is the ability to see where your inventory is at any given time and how it’s moving through your supply chain. For example, suppose you want to know exactly how much of a specific product is left at each of your warehouses or distribution centers (DCs), what condition it’s in, and who has picked it up from there. In that case, you need improved inventory visibility. 

Improved inventory visibility helps retailers improve their operations by allowing them to:

  • Track product from origin point through all stages of the supply chain
  • Identify bottlenecks in the flow of goods
  • Improve forecasting accuracy by providing better information about future demand patterns

Faster Order Fulfillment and Delivery

With an optimized warehouse, you can reduce the time it takes for goods to be available for delivery, which means your customers will receive their orders faster. This is good news for both you and them. In fact, it is the best way to survive in the competitive space.

For instance, Amazon ships more than 66,000 orders every hour in the US, a huge task resulting from optimal warehousing. To compete with such giants, you must ensure faster delivery.

A well-organized storage facility also helps you avoid back-orders and other problems arising when misplaced or unavailable products. This means less wasted inventory carrying costs and fewer customer complaints about delayed shipments or poor service levels. According to Netsuite, the ideal inventory turnover ratio should be between 5 and 10 in US markets.

Reduction of Out-of-Stock Products

The benefits of optimal warehousing practices can be seen in the reduction of out-of-stock products and the subsequent reduction in inventory costs. This is because it allows you to have better visibility over your inventory levels, which means that you’ll be able to plan for future demand more effectively and reduce the amount of stock you hold at any given time.

This leads directly to increased customer satisfaction, as well as revenue. With fewer out-of-stocks and lower costs, customers are more likely to buy from your business rather than looking elsewhere for their needs.

Increased Productivity and Efficiency

Warehousing is a critical part of your supply chain. It’s the point where your products are stored and prepared for shipment to customers, as well as the place where carriers or distributors pick them up. If you’re not using optimal warehousing practices, it can result in decreased productivity and efficiency throughout the rest of your operation. Here are some ways that optimal warehousing practices can help streamline your business:

  • Reduce time spent on inventory management: Warehouses need to keep track of all their products so they know what’s available at any given moment. This process often involves scanning barcodes or manually entering product information into databases, which takes up valuable time that could be better spent elsewhere within your organization.
  • Reduce time spent on logistics: Warehouses also need accurate information about orders coming in from retailers. Hence, they know how much stock needs to be pulled out from storage before shipping out those orders.

Integration with ERP Systems

Integration with ERP systems is one of the most effective ways to streamline your supply chain. ERP systems manage inventory, plan and forecast, order fulfillment, and more. In fact, an integrated solution can help you improve efficiency across all areas of your business by providing a single source of truth for:

  • Inventory management
  • Planning & forecasting
  • Order fulfillment

Improved Transportation Time Management

Improved transportation time management is one of the most beneficial aspects of an optimized supply chain. The ability to quickly and efficiently move inventory from its point of origin to its destination allows you to reduce transportation costs and improve your customer service.

In addition, it can help you reduce delivery times, which is especially important when you’re selling products that are in high demand or require rapid delivery. Finally, optimal warehousing practices allow you to decrease the risk of damage during transit by keeping products in good condition until they reach their final destination.

Better Customer Satisfaction

You may think the only benefit of optimizing your warehouse is improved efficiency and cost savings. However, there are also many benefits to increased customer satisfaction.

You’ll have fewer customers who are unhappy with their experience, which can result in repeat orders or referrals. When you deliver products on time and in good condition, you show that you care about them, which means a lot.


Hopefully, we’ve given you some ideas about how to improve your supply chain. The most important thing is to remember the end goal of creating a more efficient and effective supply chain that will benefit everyone involved. 

By following these tips, you’ll be able to make a new way of doing business that will allow all parties involved in production and distribution, including customers, to enjoy better service and less waste overall within their industry sector.