Distribution Center Processes and Best Practices You Need to Know

A good distribution center is like a symphony. Each department does its job right, and when you combine them, everything works together harmoniously.

Yet Beethoven didn't conduct symphonies for over 40 hours a week. This is the challenge with distribution centers. They should ensure a complex supply chain runs smoothly at all times.

There are several essential distribution center practices for flawless warehouse operations. One of them is enhancing the final delivery stage. Read on to learn more:

Navigate to the section that interests you most:

• Crucial Procedures and Practices in Distribution Centers
• 7 Best Practices for Distribution Centers

Crucial Procedures and Practices in Distribution Centers

Before exploring best practices, let's go over the fundamental processes. Distribution centers use these processes to maintain organized supply chain logistics. These signify the fundamental operations of a distribution center:

1. Receiving: Clerks check deliveries to make sure they match the order and are in good condition. Reception teams may also scan products for inventory tracking.
2. Put-away: After receipt, warehouse staff and forklift operators move products to a secure storage area. This ensures the safety of products until a customer makes a purchase.
3. Storage: Warehouse workers track inventory to ensure items are secure. For temperature-sensitive goods like food, regular checks prevent spoilage. Expired items, on the other hand, are discarded. Also, products may be moved to focus on easy access for popular or frequently purchased items.
4. Picking: When a customer orders, workers retrieve items from storage shelves and take them to a packing area.
5. Packing: Packers box and label customer orders for shipping or delivery.
6. Restocking (returns): When a customer returns a product, a warehouse worker inspects it. They check it for expiration dates and missing parts. They will restock it if it passes quality control.
7. Auditing: Warehouse audits assess the overall efficiency and effectiveness of distribution center processes. They also help management teams understand their team's performance.

Several distribution centers assign specific teams to manage each of these inventory processes. Effective communication among all teams is crucial for success. If the storage team rearranges stock, they must inform pickers and put-away workers. If not, your workers will search aimlessly for products. That, in turn, can cause a slowdown in your supply chain.

Don't forget Last Mile Delivery

Running your distribution or fulfillment center's supply chain is one piece of the puzzle. The remaining part involves coordination with last mile delivery. People sometimes don't realize how important this partnership is. But it's essential for your success. It makes sure customers get their orders quickly.

Even with the most efficient pickers and packers out there, delivery delays might still happen. This happens if you don't have effective communication with your delivery team. Even worse, products could spoil. For instance, you get an order for two gallons of milk. Your pickers fetch the milk and take it to packing. But it ends up sitting on a warm loading dock for four hours before being loaded into a refrigerated truck. All this because you weren't certain about the truck's arrival time. In the end, you are responsible for compensating your customers for receiving spoiled milk.

Working with couriers, shippers, or in-house last-mile delivery teams necessitates good communication. Warehouse managers or dispatchers must know exactly when delivery trucks will arrive. This helps them schedule picking and packing at the right time for efficient operations.

Pro Tip: Streamline the coordination of picking, packing, and last-mile delivery. All this is possible with route optimization software like eLogii. It includes live tracking capabilities, allowing real-time monitoring of the delivery process.

7 Best Practices for Distribution Centers

To make your distribution center work well, improve processes for efficiency and profit. Follow these tips to spend less while moving products faster. Above all, provide a better experience for your customers.

1. Utilize route optimization software to coordinate with last-mile delivery

We talked about the significance of coordinating with last-mile delivery. But how can you achieve complete synchronization in your supply chain? One efficient tool is route optimization software equipped with live tracking features.

With eLogii, warehouse dispatchers can track the real-time locations of delivery drivers. This allows them to plan picking and packing before the truck arrives. The result is a reduction in the time products spend on a loading dock.

Route optimization software helps reduce unnecessary expenses. It also ensures delivery drivers take the fastest route, making customers happier. With eLogii, dispatchers can schedule many truck pick-ups for individual drivers with the "Return to Depot" feature.

eLogii: Return to Depot

With eLogii, you can enjoy Realtime Order Tracking for your customers. Cut delivery exceptions and offer your customers a live tracking experience with their delivery driver. This enables customers to stay informed about the arrival time of their package. You can expect a reduction in redelivery attempts on the whole. Also, there will be fewer customer service inquiries about delivery timelines.

2. Enhance your warehouse efficiency with a state-of-the-art warehouse management system

When handling a multitude of tasks across many employees, advanced tools become essential. A warehouse management system (WMS) is indispensable in this scenario. Operating a supply chain without it is comparable to navigating a complex maze without a map.

A WMS is like a main control hub for warehouses. It helps your team handle things like managing physical inventory and staying aware of product expiration dates. You can also use it for restocking, finding specific product spots, and more. WMS allows the scanning of the barcodes for incoming supplies during the receiving process. Your pickers can then see those items seconds later in the updated inventory list. It minimizes human errors and enhances picking precision. Additionally, it provides real-time visibility within your facility, no matter how large or spread-out it might be.

Pro tip: Connect your WMS with route optimization software to track products from receiving to final delivery. Integrating with the eLogii Web Service API is straightforward. You can follow the steps from the eLogii API documentation to integrate it with other software.

3. Find the best picking strategy

Explore the distinct benefits of each picking process. Feel free to experiment with various methods to identify the one that suits your team the most.

Single-order picking is efficient for smaller, low-volume warehouses. Yet, it may not work as effectively for warehouses dealing with a high volume of outgoing orders each day.

Picking waves aid distribution centers in minimizing congestion on bustling warehouse floors. It also helps align packing schedules with the arrival of delivery trucks, no matter their size.

Batch and cluster picking can lessen the time spent on picking when handling a lot of orders with many SKUs.

Zone picking is an excellent choice for managing warehouses with many storage areas. When you use this picking method, pickers can get products that are in smaller zones. This allows you to combine orders before packing and avoid wasting time running all over a big warehouse. Zone picking is a frequent practice in food warehouses and distribution centers. It is especially common with refrigerated and non-refrigerated warehouses.

Trial and error is the best way to find the right picking method for your distribution center. Some warehouses combine several methods, like zone picking with cluster picking. Speeding up picking times is also possible with radio frequency identification picking. It eliminates paper orders, and pickers receive the lists on their wearable electronic devices.

4. Optimize your warehouse layout

Tweaking your warehouse layout can make your supply chain operations run smoothly. Or, it can cause big challenges for your team. Distribution centers work best when they have simple layouts for easier product movement. The layout ensures a seamless flow, from receiving goods to loading them into trucks.

Selecting the best picking method and organizing your warehouse layout involves experimenting. Ensure that frequently bought items are reachable for pickers. Also, be open to rearranging products as needed. Let's say your inventory includes artificial Christmas trees. In that case, you need to make them accessible in November and December. But for the rest of the year, it's fine to store them on a high shelf at the back of the facility.

You want your aisles to be big enough to accommodate pallets, foot traffic, and forklifts. Make sure the packing center is close to the loading docks. Your delivery teams also need a staging area to load and unload vehicles.

5. Perform routine warehouse audits

Warehouse audits rank among your most valuable tools. Picture them as an open-book test. You're guaranteed an A, even if you don't know the answer immediately; you only need to know where to look.

Internal warehouse audits help managers check team performance and spot areas for improvement. Data collection allows for tracking performance metrics over time. That includes inventory count accuracy and order fulfillment efficiency.

Audits are crucial when it comes to checking inventory quality, stock freshness, and adherence to safety protocols. Sometimes, pausing product movement in the supply chain may cause a slight slowdown. In this case, routine audits can save significant time and money for your business.

Think about forklift maintenance, for instance. Audits help ensure the proper upkeep of forklifts. For example, spending ten minutes checking maintenance logs can save you millions in damages and lawsuits. Confirming safety checks is another crucial step in preventing potential issues. Audits act as your business's large safety net.

Pro Tip: Instead of one extensive audit once or twice a year, consider breaking it into smaller, manageable sections. Perform these sections once a month on a rotating basis.

6. Establish an efficient returns procedure

Product returns are unavoidable. According to RetailWire, the typical return rate for online purchases goes from 15% to 30%. Thus, it's essential to put in place a system to manage these returns. Even more so, you can leverage reverse logistics to benefit your operations.

Distribution centers and third-party logistics firms provide valuable support to retail clients. This is possible through effective return management. In that way, seamless returns contribute to repeat sales. According to Invesp, almost 60% of customers prefer a no-questions-asked return process. Bringing customers back from their return journey and back to the buyer journey is easy. Controlling the process completely allows you to focus on giving a positive shopping experience to a customer. Thus, boosting your bottom line is possible with a seamless return procedure.

Pro tip: eLogii streamlines return pick-up, making the process more efficient. It accelerates the return of products to your warehouse with drop-off and pick-up routes.

7. Reassess and make adjustments

Supply chain logistics are intricate and ever-changing. Thus, it's crucial to reassess and adjust warehousing processes. Products may need rearrangement based on seasonal demand. Employees may need extra training for promotions or new safety protocols. Consult with employees, from pickers to managers, to gather insights on process enhancements. Trust and leverage the unique experiences of your "boots on the ground."

Leverage analytics to pinpoint areas for team improvement and process refinement. eLogii automates tracking of delivery teams' on-time rates, both for individual drivers and the entire team. Track the journey from warehouse departure to delivery. Access WMS analytics for real-time statistics on warehouse operations. Apply these insights to drive bottom-line growth and enhance operational efficiency.