The warehouse putaway process is how your warehouse receives and stores stock from a vendor. The purpose of the process is to take inbound inventory and place it in an optimized location in a methodical way. For warehouse managers who want to increase warehouse efficiency and optimize inventory management, the putaway process is a great place to start.
What is the putaway process in warehouse management and logistics?
Putaway is a supply chain process that logistics professionals use to move products from receiving to storage locations. Putaway is the process of storing goods in a warehouse. It is a key component of warehouse management and logistics, as it involves picking items from inventory and placing them on a pallet or shelf. Putaway begins with receiving goods into your warehouse, either through shipments or via an internal pull system. The final location where each item goes is called its destination.
It includes the following sub-processes:
- Receiving: The receipt of goods at a warehouse or distribution center, including all paperwork associated with the transaction.
- Storing: Placing products into their final destination (storage location) within the warehouse or distribution center with the goal of faster picking and optimized space usage.
- Palletizing/Stuffing: Placing products on a pallet for shipment or storage in the warehouse.
Achieving optimal putaway efficiency requires both automated processes as well as human intervention from trained employees who know how to handle fragile items or unusual packaging. When done correctly, putaway can reduce costs by speeding up throughput time. However, if not executed properly, it can result in additional storage costs due to excess inventory or wasted labor hours spent moving products around unnecessarily during the picking process.
Benefits of an efficient putaway process
An efficient putaway process can help you achieve several benefits, including:
- Faster Picking times: A reduced pick speed is often tied to not having the right pick method in place, but it can also indicate poor putaway process, lack of technology training, or improper location management.
- More labor efficiency: Receiving requires fewer person-hours and employees with systematic putaway processes.
- Reduced Travel time: Time to receive and pick are optimized via better warehouse routes.
- Safety: A more organized warehouse is a safer one for both goods and employees.
- Increased spatial organization: Shelf utilization is optimized, freeing up valuable space for storage.
Warehouse putaway methods
Direct Putaway: This is a method of storing goods in which a worker scans the SKUs on pallets and places them directly into storage. While it's relatively quick, this process has little flexibility for orders placed later than when goods are received. It also does not allow for sales items to be separated from non-sales products. Direct putaway can become challenging to manage as the number of products increases.
Dynamic Putaway: This method uses data on your warehouse operations to dynamically adjust the placement of inventory. A system collects data about how products are moving through your warehouse, such as pick time and inventory aging, and helps direct better inventory placement and putaway strategies that change over time as the data evolves.
Fixed Putaway: Unlike dynamic putaway, inventory is placed in a predetermined location based on criteria (product type, destination, etc.) and doesn't change over time.
Other considerations include:
By Customer (For Third-Party Logistics Warehouses): You can choose to designate specific areas of your warehouse to customers of your third-party logistics (3PL) warehouse. This provides an intuitive process for employees and works best for customers with fewer SKUs.
By Storage Requirements: Some products may require special storage considerations such as refrigeration, and you will have no choice but to store them in specialized areas. In other cases, you may need to place some heavy products that shouldn't be stacked closer to the equipment required to move them.
By Volume: High-volume goods should be put away in locations that reduce the travel distance to both staging and packing areas. Ongoing monitoring should help you understand when a change in sales volume will necessitate a change in your putaway process. When expecting a seasonal increase in shipping frequency (very common with ecommerce), consider making changes to your locations and putaway processes ahead of time.
Tips to optimize your putaway process
Automate the putaway and picking processes with automated storage and retrieval systems (AS/RS), which are made up of a network of computer-controlled pieces of equipment. You can also utilize directed putaway offered by many warehouse management system (WMS) software platforms that automatically tell warehouse employees how to proceed in the putaway process based on rules placed in the system for specific inventory.
Process flow optimization
Try keeping heavier items closer together than lighter ones so that when someone picks up an empty box (which should always be placed directly next to its full counterpart), he or she doesn't have as far left or right across their workspace before reaching another empty box again—this could otherwise waste time spent walking back from another part of the warehouse where those boxes might actually belong instead.
Once inventory arrives in the warehouse, consider the following processes to help manage to receive and putaway processes:
- Does your warehouse measure your dock-to-stock time?
- Is your warehouse management system using automation to suggest or direct the placement of inventory?
- Are the pallet racks, floor locations, and replenishment areas properly labeled and barcoded?
- Are items being stored based on order fulfillment type pick units in bins, cases on racks, pallets in overstock areas?
- Are items barcoded clearly with either Pallet License Plates or retail ready UPC codes?
- Has your warehouse migrated to a paperless process or WMS for 100% scan-based item validation and putaway?
- Does your warehouse team have access to receiving status in real time?
By completing this inventory-receiving process before and after arrival, warehouses can increase efficiency and customer visibility as well as automate activity capture to improve the billing process for 3PLs.
How do you optimize the warehouse putaway process?
The first thing you should do is determine the type of inventory you have in your warehouse. If you have a lot of bulky items, it might make sense to consider additional storage space. Also, if the items are large and heavy or require specialized handling equipment, then you'll want to make sure that your warehouse layout is optimized for their handling needs.
Next, make sure that your employees are trained on the putaway process. This includes having them understand how their role fits into the overall process as well as how they can help make any improvements along those lines (such as recommending ways to improve inventory management). Especially when using automated methods, ensuring your employees receive adequate training on software systems is essential to a successful putaway process.
The putaway process is one of the most important activities in warehouse management. It is also one of the most complex and challenging tasks because it affects a wide range of different processes, such as order picking, stacking & packing, palletizing, and shipping.