Warehouse Zoning - An Overview

Introduction

Zoning is the process of classifying the warehouse areas into sections based on the putaway requirements, picking strategies and work execution principles.

When a warehouse is being designed, a decision has to be made in regards how and where to store products belonging to different families. Depending on that products will be stored in the warehouse. These are called as put-zones.

This is the case when the characteristics of a product require it to be stored below or above a certain temperature, or due to its volatile nature, has to be stored in a special cabinet, area or room. This is called zoned storage, and it is a commonly used in warehouses.

Zoning can be defined as “A technique for laying out warehouse storage which seeks to minimize “pick”, travel time by grouping the most used products closest to their point of use.”

Put-zones:

Different types of Put-zones in a warehouse may depend on the nature of products being stored. Some examples of zoned storage are listed below.

Refrigerated Zone –  A business may use products that need to be kept at a certain temperature such as food products or certain chemicals. 

Dry Storage  Zones – Dry storage is a common zone in a warehouse. Many products need to be kept away from moisture. For that dry zone can be used. 

Flammable Liquids Zones - Some companies use chemicals in their manufacturing process and these need to be stored safely.  

Corrosive Materials Zones - Corrosive Materials such as acids, also must be stored in the warehouse in their separate cabinets.  

Oversize Storage Zones - Some materials in the warehouse will not fit in a normal size rack and need to be stored in a separate area. For example in an automotive warehouse, complete exhaust systems could not be stored on normal racking, so would have to be stored in an area specifically for oversized products.

Security Cage Zones –  For companies that have to store small size, but high value products, there may be a need to store the products in a security zone.

 

Pick zones:

Zone based picking can increase the efficiency of the warehouse personnel. There are two variants of picking based on zones

Progressive zoning – Picking is completed in one zone before starting in the second zone.

Synchronized zoning – Picking happens simultaneously in multiple zones.

Work zones:

Zoning can be done based on the nature of work requests and their attributes like priority, vehicle access and authorized personnel to execute those works.

The outcomes of a zoning process are

The number of zones in each warehouse area

The priority of work in those zones

Authorized personnel who can work in those zones

Vehicles that can be used in those zones

Storage Optimization in a Warehouse - An Overview

Storage optimization can bring in significant cost reduction due to high utilization of warehouse space, the key warehouse resource. Moreover it is driven by the principle “When placed right taking it away is easier and efficient”. How we decide on the optimal location for putaway is key to the success of storage optimization.

There are different types of storage allocations possible in a warehouse. Each of these have their own merits and demerits. This article is to illustrate the guiding principles and the merits and demerits of those strategies.

1. Dedicated Storage:

Each location inside the warehouse is assigned to specific item meaning only that item can occupy in a particular location. This method reduces picking errors to a large extent and easier to handle things inside a warehouse. The main disadvantage is space optimization is very less as a location dedicated to an item cannot accommodate another item. If that particular item is out of stock the location remains vacant. The number of locations needed inside a warehouse increases drastically in case of dedicated storage method. This method provides high travel time efficiency as we can place the fast moving items close to the shipping dock doors. Usually forward pick areas inside the warehouse have dedicated storage. The location assignment is based on slotting principles. Only the fast moving items are placed in the forward locations and hence chances of low space utilisation is less.

2. Random Storage:

At the time of putaway, the locations are randomly chosen for the putaway of the items. Each eligible location has equal probability of occupying a specific load. This method provides high space utilization but poor travel time efficiency as the fast moving item can be placed in the rear side of the warehouse and the slow moving item closer to the dock doors.

3. Closest Open Location Storage:

In this method, the location is chosen based on which is the closest location eligible for storage at the time of putaway. Over a period of time the travel time efficiency reduces significant as the slow moving items keeps occupying the closest locations. This method provides high space utilization.

 

4. Class Based Storage:

In this method, the items are segregated in different classes such as A, B and C class items. A class items are fast moving items. B class items are medium moving items and C class items are slow moving items. The classification is done based on Pareto principle (80:20 rule). The locations inside the warehouse are divided into three zones. A class items are stored in ‘A’ zone and ‘B’ & ‘C’ class items are stored in their respective zones. Inside a zone the items can be stored randomly are based on put travel sequence of each location. This method offers high travel time efficiency. Space utilization is comparatively less when compared to random storage method. The space utilization is constrained by the item class. For example a location earmarked for ‘B’ class items cannot accommodate ‘A’ class item.

5. Full Turn over Storage:

This method is driven by Dynamic slotting principles. Items are stored based on their turn over volumes. A very fast moving item is stored close to the dock door and the second item based on the turnover is stored in the next location. As the turnover of the items changes the storage assignment also gets changed. This method is highly data intensive and come with hassles related to frequent change of location. Nevertheless this method offers the highest travel time efficiency and space utilization when compared to other methods.

Inventory Management & Control in a Warehouse

Inventory management inside a warehouse is key in keeping the accuracy of the records and to do vital transactions like replenishments. Different activities forms part of inventory management operation. They are as follows.

Inventory transfers

Inventory transfer is an act of moving inventory from one storage location to another storage location. The purpose may be for consolidating the less than pallet loads into full pallet load, or the inventory placement is not matching with the system records.

Inventory Adjustments

Inventory Adjustments is correcting the quantity in order to accomplish certain goals like maintaining the record accuracy, accounting the missing inventory, scrapping the inventory inside a warehouse and others.

Ownership transfers

Client transfer / Ownership transfers is transferring the ownership of inventory from one client to another client. This may arise due to sales or inaccurate accounting of inventory.

Lot Management

Lot management is the process of managing the items as per the production lot to which they belong. Sometimes lot conversion is needed in order to correct the inaccurate recordings of lot number at the time of receipt. In other cases like price based lot management, lot conversion might be needed to enable promotions and other sales offers.

Serial Number Tracking

Serial Number tracking is often done in electronics products. Inventory is tracked as per the serial numbers to which they belong. The serial number tracking may be one of the following three types

vInbound tracking

vOutbound tracking

vCradle to Grave tracking

Country of origin tracking

Country of origin reporting is mandatory for certain goods in many countries. For this reason the inventory is maintained as the country of origin attribute and is tracked in inbound and outbound activities.

Cycle Counting

Inventory in a set of locations is counted to ensure the system quantity and the physical quantity are in sync with each other. In case of discrepancies an audit count (second count) can be trigged. The system quantity gets adjusted in accordance with physical quantity post cycle counting.

Replenishments

Filling up the pick-faces locations with adequate quantities from the buffer storage locations is called replenishment in warehousing operations. System calculates the replenishment quantities and then replenishment task is released to the floor. Operator goes to the buffer storage locations picks the inventory and deposits into the destination location, usually a pick-face location. There are various types of replenishments

1. Manual Replenishment
2. Top Off Replenishment
3. Triggered Replenishment
4. Emergency Replenishment