Storage and Warehouse Techniques

This document discusses various techniques and strategies for storage and warehouse management. It covers topics such as the location of the warehouse, layout design, numbering system, space utilization, storage equipment, material handling equipment, order picking strategy, resource planning, IT systems, and general tidiness. The document provides insights into the potential costs and key performance indicators associated with each aspect of warehouse management.

Running head: STORAGE AND WAREHOUSE TECHNIQUES 1
Storage and Warehouse Techniques
Name
Institution

STORAGE AND WAREHOUSE TECHNIQUES 2
Location of the warehouse
The location of the warehouse is located close to other retailers which makes operations
to be handled in a short period of time. The location of Jim Olsens plays a crucial role in
determining the time for making deliveries to the consumers. As a logistic manager, it is equally
significant to consider building and leasing the warehouse for purposes of factoring sustainable
options. Another vital factor with respect to location of the warehouse is the requirements needed
for storage of the products (Atieh et al, 2016).
The potential sources of cost with respect to location of Jim Olsens warehouse is
attributed to distance between the warehouse and consumers. For instance, if the distance
between the consumers and the warehouse is big, it will cost the company more to get products
to the consumers. Another cost is linked to proximity to carrier companies, Jim Olsens
warehouse should therefore be located close to carrier services to streamline operations. Another
source of cost is storage requirements which influence the cost of construction. Other sources
include workforce availability and sustainability cost (Davies, 2019).
The KPI that is applicable in Jim Olsens scenario with respect to location is cost of
carrying the inventory. This involves all the cost that will be associated in storing products over a
period of time. This measurement primarily focuses on the various cost associated to warehouse
location. Among these costs include labor cost, insurance cost, carrier cost and risk associated
costs. This performance measure will determine profitability as well as facilitate finding new
ways of managing carrying cost.
Layout of the warehouse

STORAGE AND WAREHOUSE TECHNIQUES 3
The layout of Jim Olsens warehouse is categorized into three distinct zones. These zones
represent the stock owned by the three collaborating business. The three classification include
paint shop goods, grocery store goods and tiles goods. Also, the three businesses are in close
proximity to each other. However, the paint shop occupies 20 percent, grocery occupies 40
percent and tiles of occupy 40 percent. The activities in the warehouse include unloading,
storage, picking and loading of goods.
Image: Jim Olsen Storage and shop schematic (Nelson Marlborough institute of technology,
n.d.).
The potential sources of cost with respect to layout include partition cost for Jim’s
enclosed store since the warehouse is used between three entities. Besides, Jim and the two

STORAGE AND WAREHOUSE TECHNIQUES 4
parties incur handling cost for storage space. Another cost that is associated to layout is handling
cost from trucks to specific warehouse. Furthermore, other associated cost with layout of the
warehouse is loading and picking items that are handled in the store (Hollis, 2017). In addition,
the three collaborators in the warehouse incur maintenance cost for the warehouse.
The key performance indicator that is applicable to measure the performance of
warehouse layout is receiving efficiency. Receiving efficiency is an important performance
indication that is centered on measuring the efficiency with which products are received and
handled in the warehouse. Therefore, the layout of the warehouse should be structured by
considering the time and manner in how products are going to be handled (Richards, 2017). A
lean warehouse management is considered to be effective in reducing time and activities that
take place within the warehouse.
Location numbering system
The warehouse relies on traditional stock labelling and knowledge of where things are
located (Alyahya, Wang & Bennett, 2016). Jim Olsens warehouse does not have partitions
except for the enclosed space for storing paints among other flammable liquids. Although the
warehouse is not partitioned, it is divided into three sections. The first section is the automotive
paint that contains enamel paints, sand papers, masking tape, spray guns, overall and gloves. The
second section is the grocery store that houses bulk food products and non-perishable food while
the third section contains ceramic tiles among other tiling equipment. The pain and the tiles have
three storage racks on the opposite site while grocery has three racks and one shared between the
tiles and the grocery.

STORAGE AND WAREHOUSE TECHNIQUES 5
Image: Jim Olsen Storage: Floor Plan Schematic (Nelson Marlborough institute of technology,
n.d.).
The potential sources of cost attributed to numbering system used in the warehouse is
cost of constructing racks for the three collaborators. Another important cost is centered on
ensuring the conditions that support different types of products in the same warehouse.
Moreover, the cost of labeling items in specific racks is a potential cost affecting the numbering
system.
The most appropriate key performance indicator for numbering system in Jims Olsens
warehouse is order picking and packing. This is considered as the most expensive cost in the
process because labor demanding in nature. Among specific key performance measures that will
be used for Jim Olsens scenario is cost per item, number of orders that are picked in a given hour

STORAGE AND WAREHOUSE TECHNIQUES 6
as well as order cycle times (Geisler et al, 2016). These key performance measures are uniquely
identified to improve efficiency in inventory management.
Space utilization
John Olsens warehouse is divided into three section with regards to space utilization. The
three collaborators share the space approximately 20 percent for paint shop, 40 percent for the
grocery and 40 percent for tiles. Items are stored in racks within the warehouse and there are also
aisles that are available within the racks to be used. Each collaborating entity is responsible for
the space they are allocated.
Image: Warehouse section showing three storage racks (Nelson Marlborough institute of
technology, n.d.).

STORAGE AND WAREHOUSE TECHNIQUES 7
The potential cost for numbering system in Jim Olsens warehouse is adopting to a
reliable technology that will manage the picking. Besides, the items in the warehouse should
have bar codes which will enable the warehouse to incur cost for barcode development and bar
code reader (Barcode, 2016). In addition, the warehouse is likely to incur cost of wearable
scanners for workers handling the products. More so, Jim Olsens warehouse requires an
elaborate numbering system that will handle goods in an efficient manner.
The key performance indicator that is applicable for this aspect include measuring order
picking and packing through evaluating specific areas such as cost per line item picked, number
of order, cost of labor, packaging and order cycle. Measuring these aspects is significant to
increase the efficiency of the supply chain as well as the demand and quality of items that an
inventory carries. In this regard, measuring these factors will play a crucial role in evaluating
how the three collaborators utilize their space (Jia, Huang, Gao & Luo, 2018).
Storage equipment
Jim Olsens warehouse is considered to be grimy and disorderly which is illustrated by the
fire exit which is blocked. This shows that the management of equipment within the warehouse
is not handled properly. Therefore, in order of Jim Olsens warehouse to manage their equipment
accordingly, it must ensure that it provides workers with the right material handling equipment.
In addition, there should be tools to handle bulk material, transportation, automate processes as
well as storage and handling equipment. Other recommendation include planning the layout,
training the staff and enhancing forecast accuracy (Intralogistics, 2017).

STORAGE AND WAREHOUSE TECHNIQUES 8
Image: Equipment blocking storage (Nelson Marlborough institute of technology, n.d.).
The potential sources of cost related to storage equipment include the cost of acquiring a
system that manages storing and retrieving of items within the warehouse. This requires Jim
Olsens to invest in automated systems and equipment that are capable of handling bulk goods.
Besides, cost associated to planning the warehouse layout will be considered in order to clearly

STORAGE AND WAREHOUSE TECHNIQUES 9
define loading and unloading areas, reception and work stations among other areas such as
storage, picking and dispatching areas.
The applicable key performance indicator for storage equipment are focused on
monitoring inventory turnover, carrying cost of the inventory and average inventory value.
Inventory turnover is crucial for Jim Olsen because it measures the frequency with which a firm
sells its inventory. Furthermore, storage equipment can be measured by considering the cost of
carrying inventory. For instance, risk associated to insurance and labor is likely to encourage Jim
Olsen to consider the right equipment for storing items to reduce risk in the warehouse.
Material handling equipment
Jim Olsens warehouse maximizes the use of forklift truck that is used for placing and
removing pallets. The racks can also be customized to increase the number of pallets. Material
handling is crucial for any kind of warehouse because it increases efficiency. Lack of reliable
material handling equipment is contributes to inefficiencies that result in decreased performance
across all operations in the warehouse. For this reason, Jim Olsens warehouse is required to
consider automation system (Hsia et al, 2018).
The potential cost associated to material handling equipment is investment on automation
technology that handles equipment in the warehouse. The automation system will play a crucial
role in ensuring that items are properly picked and placed on shelves within the racks. Other cost
include investing in Radio-Frequency Indemnification system that will track items within the
warehouse. Another cost involves the organization of the warehouse. In this case, Jim’s
warehouse requires organization to ensure that the forklift is able to maneuver between the
spaces to place and pick items from the racks (Benevides, 2018).

STORAGE AND WAREHOUSE TECHNIQUES 10
The key performance indicator that is applicable from material handling equipment is
Put-Away process. This process allows products that have been picked to be moved closer to the
final location. This often requires resources to ensure that products will be picked and shipped
with ease. Among the factors to consider in this performance measurement is accuracy levels,
cost incurred to put an item away, time taken from receiving to picking and number of hours
taken to handle the whole process.
Order picking strategy
Jim Olsens warehouse relies on traditional stock labeling and memory with respect to the
location of the products. The stock in the warehouse is handled by an individual order. For this
purpose, Jim has developed a warehouse handling data that considers the daily volume and
productivity standards. Besides, it lists all the inbound and outbound operations. Jim uses the
data to identify high stock items which are stored in places that are easier to access within the
warehouse.
The potential sources of cost with respect to order picking will consider reducing travel
time to enhance order picking productivity. In this regard, the warehouse should invest in
material handling and numbering system that will be reliable in handling the items in the
warehouse (Chase, 2019). Moreover, the business should invest in technology that handles
orders once they are picked and updates the database in relation to the items that have been
moved and shipped to consumers. Another cost is to invest on automating handling data for
increasing efficiency.
The key performance indicator that is applicable to order picking strategy is picking and
packing cost (Apsalons, R., & Gromov, 2018). This is most crucial for Jim Olsens warehouse

STORAGE AND WAREHOUSE TECHNIQUES 11
because it is demanding and involves complex operations. This is important because it is closely
tied to customer satisfaction. Among other considerations in this performance measure is cost per
line item, orders picked in a given time, labor costs, consumable usage and cycle per order.
Another key performance measurement in this phase will be customer cycle order time that
focuses on delivering the products within the shortest time as possible (Anđelković &
Radosavljević, 2018).
Resource planning
Jim Olsens warehouse employs one worker who relies on the forklift truck while Jim
handles customers in the shop. Jim only helps out in the warehouse during busy days. The
warehouse requires a reliable and trained personnel who will be mandated to handle materials,
operate forklift and preparing orders. In this regard, Jim is required to hire a specialist to
streamline the processes for purposes of increasing efficiency.
Image: Animation of a training session to build capacity of warehouse handlers (Human resource
management, 2013).
The potential sources of cost with respect to resource planning include hiring and
retaining cost. The warehouse is required to invest in hiring process that will ensure that the right

STORAGE AND WAREHOUSE TECHNIQUES 12
person is selected to handle activities in the warehouse (Chen, Mao, & Gan, 2018). Furthermore,
Jim Olsens warehouse should incur cost related to training and development of activities in the
warehouse. This training will facilitate gaining of knowledge that is crucial to increase efficiency
and enhance productivity in the warehouse. In addition, the warehouse can hire a second person
to assist in the warehouse processes.
The key performance indicator that is applicable for resource planning is training hours.
This is because training and development exercises tend to increase loyalty and productivity.
Tracking the number of training is therefore crucial to ensure that the investment is fruitful in the
long-run (Robinson, 2016). Training initiatives will consider factors relating to labor and how
these factors contribute to influencing the performance of the warehouse. Another performance
indicator that is applicable to this level is productive time which considers the effectiveness of
the workforce.
IT systems
There are no integration of IT systems that are evident from Jim Olsens warehouse. As a
result, the lack of technological support impacts the operations of the business negatively
implying that Jim Olsens warehouse should be able to increase its efficiency by relying on
technology in various sectors of the warehouse. For instance, the warehouse requires as system
that handles order as well as a system that manages all the items that move in and out of the
warehouse.
The potential cost that is associated with this aspect in investment in various
technological applications. The management applications are significant in assisting the business
to reduce cost associated to labor and control of the inventory. Rather than relying on the

STORAGE AND WAREHOUSE TECHNIQUES 13
memory and traditional methods to locate products, the warehouse can incur cost for a reliable
system that incorporates the services of the warehouse into one database (Bulsara, Qureshi &
Patel, 2016). Another cost that the business is likely to incur is training cost for the new
technology to manage the warehouse.
The applicable key performance indicator for information technology is customer support
ticket resolution. This will consider the average time taken by Jim Olsens warehouse to address
customers concerns. Besides, it will play a crucial role in measuring the effectiveness and
efficiency with which IT systems within the warehouse are structured to meet the concerns of the
consumers (Eroshkin, Kameneva, Kovkov & Sukhorukov, 2017). Another performance indicator
applicable to this stage is inventory accuracy which can be streamlined and updated continuously
through a reliable system.
General tidiness
Concerning tidiness, the warehouse is considered to be filthy and disorderly from the
image showing the fire exit to be blocked. The look of the warehouse when a client enters will
play a role in determining various aspects such as reputation of the warehouse. For this purpose,
Jim is required to ensure that he emphasizes on the significance of keeping the warehouse clean
(Kłodawski et al, 2017). A clean warehouse will facilitate smooth running of operations. In this
regard, Jims Olsens warehouse should have a cleaning policy and right equipment from cleaning.
The potential sources of cost associated to general tidiness will include the cost of
purchasing cleaning equipment. Besides, the warehouse will have to develop a cleaning policy
that will ensure that the warehouse is maintained clean at all times. Other cost to be incurred
include communication cost to ensure that all the workforce is involved in cleaning activities.

STORAGE AND WAREHOUSE TECHNIQUES 14
Another potential cost is the hiring a cleaning company which will be responsible in maintaining
the warehouse clean.
The applicable key performance measurement to measure general tidiness is receiving
efficiency. Receiving efficiency plays a crucial role in this case by considering aspects such as
return to vendor stock, customer returns of damaged items, customer returns of good and
multiple new stick deliveries (Manikandan et al, 2018). These are some of the factors that are
influenced by the general tidiness of the warehouse. For instance, if the warehouse is dirty and
poorly organized, it is increase receiving efficiency. On the other hand, if the warehouse it clean,
receiving efficiency will be reduced thus increasing the overall performance of the warehouse.

STORAGE AND WAREHOUSE TECHNIQUES 15
References
Alyahya, S., Wang, Q., & Bennett, N. (2016). Application and integration of an RFID-enabled
warehousing management system–a feasibility study. Journal of Industrial Information
Integration, 4, 15-25.
Anđelković, A., & Radosavljević, M. (2018). Improving order-picking process through
implementation of warehouse management system. Strategic Management, 23(1), 3-10.
Apsalons, R., & Gromov, G. (2018, May). Development of a Smart Picking System in the
Warehouse. In The 4th Conference on Sustainable Urban Mobility (pp. 565-574).
Springer, Cham.
Atieh, A. M., Kaylani, H., Al-abdallat, Y., Qaderi, A., Ghoul, L., Jaradat, L., & Hdairis, I.
(2016). Performance improvement of inventory management system processes by an
automated warehouse management system. Procedia Corp, 41, 568-572
Barcode, A. (2016). Inventory control system - automate your tracking. Retrieved from
https://www.barcodesinc.com/articles/inventory-control-system.htm
Benevides, C. (2018). Advantages & disadvantages of automated guided vehicles (AGVs).
Retrieved from https://www.conveyco.com/advantages-disadvantages-automated-guided-
vehicles-agvs/
Bulsara, H. P., Qureshi, M. N., & Patel, H. (2016). Green supply chain performance
measurement: an exploratory study. International Journal of Logistics Systems and
Management, 23(4), 476-498.

STORAGE AND WAREHOUSE TECHNIQUES 16
Chase Reeves, C. (2019). 7 Smart warehouse technologies to implement today - camcode.
Retrieved from https://www.camcode.com/asset-tags/smart-warehouse-technologies/
Chen, C., Mao, J., & Gan, X. (2018). Design of Automated Warehouse Management System.
In MATEC Web of Conferences (Vol. 232, p. 03049). EDP Sciences.
Davies, J. (2019). The advantages of using a warehouse management system. Retrieved from
http://www.winman.com/blog/the-advantages-of-using-a-warehouse-management-system
Eroshkin, S. Y., Kameneva, N., Kovkov, D., & Sukhorukov, A. (2017). Conceptual system in the
modern information management. Procedia Computer Science, 103, 609-612.
Geisler, J., Thomas, S., Pecorari, J., Hertzman, A. J., Gold, D. H., Schmidt, J. J., ... & Miller, K.
C. (2016). U.S. Patent Application No. 14/861,270.
Hollis, A. (2017). Five must-have technologies for a smarter warehouse. Retrieved from
https://holisollogistics.com/warehouse-technologies/
Hsia, K. H., Wu, M. G., Lin, J. N., Zhong, H. J., & Zhuang, Z. Y. (2018). Development of auto-
stacking warehouse truck. Journal of Robotics, Networking and Artificial Life, 4(4), 334-
337.
Human resource management (2013). Training Evaluation Process. Retrieved from
https://corehr.wordpress.com/2013/05/21/training-evaluation-process/
Intralogistics. (2017). Effective storage strategies – The basis for successful warehouse
management. Retrieved from https://intralogistics.tips/effective-storage-strategies-the-
basis-for-successful-warehouse-management/

STORAGE AND WAREHOUSE TECHNIQUES 17
Jia, C., Huang, J., Gao, Q., & Luo, S. (2018). Application of Barcode Technology in Warehouse
Management of Printing and Packaging Enterprises. In Applied Sciences in Graphic
Communication and Packaging (pp. 533-541). Springer, Singapore.
Kłodawski, M., Jacyna, M., Lewczuk, K., & Wasiak, M. (2017). The issues of selection
warehouse process strategies. Procedia Engineering, 187, 451-457.
Manikandan, S., Raju, K., Lavanya, R., & Gokila, R. G. (2018). Web Enabled Data Warehouse
Answer With Application.
Nelson Marlborough institute of technology (n.d.). Warehouse and storage technique Retrieved
from file:///C:/Users/REUBEN/Downloads/3469552_377510109_ScenarioReportB.pdf.
Richards, G. (2017). Warehouse management: a complete guide to improving efficiency and
minimizing costs in the modern warehouse. Kogan Page Publishers.
Robinson, A. (2016) 7 Innovative warehouse management technologies to adopt. Retrieved from
https://cerasis.com/warehouse-management.