Key Considerations when Planning a Warehouse

Key Considerations when Planning a Warehouse

The setup and layout of a warehouse is critical to ensuring the efficient running of the warehouse from day to day. A badly set up warehouse leads to increased stock issues, delays, errors and greater inaccuracy overall. Ultimately, an inefficient warehouse leads to an increased workload whereby these issues and inaccuracies need to be investigated and rectified as quickly as possible.


What is a Warehouse Management System?

A 'Warehouse Management System' (WMS) 'is a key part of the supply chain and primarily aims o control the movement and storage of materials within a warehouse and process the associated transactions, including shipping, receiving, putaway and picking. The systems also direct and optimise stock putaway based on real-time information about the status of bin utilisation. A WMS monitors the progress of products through the warehouse. It involves the physical warehouse infrastructure, tracking systems, and communication between product stations.[1]'


Warehouse Setup

A Warehouse Management System is crucial for companies to appropriately manage the receipt, putaway, replenishment and picking of product throughout the warehouse. The usage of a warehouse management system within an organisation leads to increased efficiency, accuracy and control over the warehouse and the movement of products. However, while the warehouse management system is critical for the business, it is vital that the warehouse has been set up as efficiently as possible to achieve maximum benefits and reduce delays, errors and inefficiencies throughout the warehouse.


Key Considerations when Planning a Warehouse

There are a number of areas that must be considered when a business is planning a warehouse. These include:

  • Warehouse layout
  • Product sizes
  • Warehouse location setup
  • Usage of racking
  • Focus: Goods In / Goods Out
  • Usage of RF devices / Manual picking

All of the above areas must be reviewed in detail in order for the warehouse to be set up as effectively as possible.


Warehouse Management

1. Warehouse Layout

They layout of the warehouse is critical to ensuring increased accuracy, speed and efficiency in the warehouse. Key questions to consider regarding the warehouse layout include:

  • What kind of route are pickers going to travel?
  • How often will they be expected to travel this route?
  • Will the picker be picking by order or by product?
  • Currently, do the pickers repeat the same steps / routes multiple times a day?
  • Where can time be saved on the pickers' route through the warehouse?
  • Are slow moving products located at the front or the back of the warehouse?


2. Product Sizes

Some key considerations regarding product sizes must also be evaluated. For example:

  • Have product sizes been analysed and used when establishing where products are to be stored in the warehouse?
  • Are these product sizes used in picking to ensure maximisation of space available in the containers into which the goods are to be picked?
  • Are both larger and smaller products stored together?
  • Are the larger products above height level?
  • Are heavier products required to be lifted manually?
  • Are forklifts required for lifting products?
  • What are the products going to be picked into? E.g. A box or a trolley


3. Warehouse Location Setup

Key consideration must also be given to the setup of locations within the warehouse.

  • What way are products stored in each location?
  • Are the products stacked on shelves in the locations within the warehouse?
  • Have location sizes been measured?
  • Are there enough locations in the warehouse currently to cater for the required products?
  • Does each location have an identifier? E.g. Location number
  • Is the product stored alphabetically or by frequency of pick?


4. Usage of Racking

  • Is the racking laid out appropriately in the warehouse?
  • How high is the racking going to be set up in the warehouse?
  • Is the picker able to access the required product when racking is being used?


5. Focus: Goods In / Goods Out

Businesses must establish where the focus and emphasis is to be placed within the warehouse. For example, in the warehouse, is the focus in the goods in area or the goods out area?

  • One of the key requirements in the warehouse is to ensure accuracy of product and quantities.
  • Consideration must be given as to whether the focus is on ensuring that the correct products are put away, in the correct quantities, into the correct locations. A focus on goods in ensures that when picking is to take place, all the goods, and quantities, are where they are expected to be. This in turn leads to greater accuracy and efficiency in goods out where the products are picked for delivery to the customer.
  • Once this decision is made, the organisation must ensure that their most highly skilled staff are located in the appropriate area where their skills can be utilised to maximise performance.


6. Frequency of Picking

With regard to picking in the warehouse, consideration must be given to a number of different options, areas and requirements. For example:

  • How many times are good going to be delivered per day?
  • Is picking going to be carried out continuously during the day? Alternatively, is picking going to be carried out in waves?
  • Has the frequency of picking of key products been analyzed?
  • Has picker performance been analysed?


7. Usage of RF Devices / Manual Picking

The business must also decide whether the picking in the warehouse is going to be carried out manually or whether RF (Radio Frequency) devices are to be used?

  • If RF devices are to be used, what kind of RF devices are required?
  • Is voice picking required?
  • If manual picking is to be selected, is the performance of the picker to be measured? If picker performance is to be measured, how is this to be carried out when the picks are manual?


An organisation looking to set up / improve the setup of a warehouse should include all of the above areas in the analysis. A review of the current warehouse structure, if in existence, is required initially. Once this review has been completed, the organisation must decide which changes and setup etc. must be implemented using the above questions and areas as a guide.

Once complete, the warehouse can then be set up as efficiently and effectively as possible prior to or in conjunction with the implementation of a warehouse management system.

The next blog in the series will look at the key areas and questions that must be considered when searching for and evaluating possible warehouse management system solutions available in the marketplace.


[1] Wikipedia: Warehouse Management System, [Online] Available From:, [Accessed: 19th October 2015]