Warehouse: organise it to move more with fewer steps
In a warehouse most of the time goes on walking. Placing each product by how often it moves, grouping orders and balancing staff across areas multiplies what ships per hour.
Same orders, two ways to slot
Random slotting · current
- Distance walked
- 3,374 m
- Total time
- 99 min
- Lines per hour
- 75
- Time walking
- 57%
ABC slotting
- Distance walked
- 1,972 m
- Total time
- 75 min
- Lines per hour
- 98
- Time walking
- 44%
The same 24 orders in both cases: only where each product sits changes.
- Lines picked
- 123
- Trips
- 24
- Distance walked
- 3,374 m
- Lines per hour
- 75
- Time walking
- 57%
- Distance vs the other slotting
- +71%
A warehouse is not a store room: it is a production line. Goods come in through the docks, get received, put away, wait, get picked, packed and leave on a truck. Every step uses staff hours, space and time, and the customer only sees the end: whether the order arrived complete and on time.
In most warehouses 50–60% of a picker's time is spent walking between racks. That is why the cheapest improvements are not machines: they are decisions about where each product lives and how each trip is built.
The stage has three views. The picking walk shows a picker walking the warehouse to fill 24 orders. The shift flow shows a whole day with trucks arriving and orders leaving. Space and utilization shows what happens when the warehouse gets too full.
Layout: where goods come in and go out
The warehouse flow decides how often goods cross their own path. Ideally every pallet always moves forward: receive, put away, store, pick, pack and load, never going back.
Separate clear zones with floor markings: receiving and inspection, rack storage, small-parts picking, packing, and a staging area in front of the outbound doors.
U-flow
Receiving and shipping on the same side of the building. They share doors and forklifts, and fast movers sit close to both. The most common and efficient design for mid-size warehouses.
Straight (I) flow
Receive on one side, ship on the opposite side. Avoids crossings when volume is very high or there is cross-docking, but everything travels the whole building.
ABC slotting: fastest movers closest
Slotting is deciding which position each product lives in. The golden rule: the most-picked products (class A by movements, not only by value) go in the positions closest to the dock and the packing area, at waist height.
In the simulation, switching from random to ABC slotting cuts the distance walked drastically with the same orders and staff. It costs nothing beyond reorganising once and reviewing every quarter.
- Rank by lines picked (popularity), not only by sales value.
- A items in the "golden zone": between knee and shoulder, in the first positions of the aisles.
- Heavy and bulky low; light and small on middle levels.
- Items sold together close to each other (kits, filter + oil).
- Look-alike items apart to avoid picking errors (sizes, similar part numbers).
- Review slotting every quarter: products change class with the season.
Picking methods
Picking is the most expensive operation in the warehouse. The right method depends on how many orders, how many lines per order and how big the warehouse is.
| Method | How it works | When to use it |
|---|---|---|
| By order (discrete) | One person picks a whole order from start to finish. | Few large or urgent orders. Simple, but walks a lot. |
| Batch | One person picks several orders at once on a multi-tote cart. | Many small orders. Cuts trips 40–60%. |
| Zone | Each person works their zone; the order moves zone to zone or is consolidated at the end. | Large warehouses or special zones (cold, controlled items). |
| Wave | Groups of orders are released by route or truck departure time. | When trucks leave at fixed times: pick in the order you load. |
| Pick-to-light / scanner | Lights or a barcode scanner guide and confirm each line. | High velocity and accuracy above 99.5%. |
Receiving, loading and unloading
The dock is the warehouse's door and often its first bottleneck. A truck waiting 2 hours to unload costs the carrier money and delays everything behind it.
To load fast, the order must be ready before the truck arrives: picked, packed, labelled and staged in reverse delivery order (last stop loaded first).
- Dock appointments: each supplier and route has a time slot; no truck queues.
- Advance ship notice (ASN) before the truck arrives: receiving is prepared and scanned against it.
- Cross-docking for goods that already have a destination: inbound truck to outbound truck without storage.
- A staging area in front of each outbound door, organised by route and stop.
- Load in reverse delivery order with standard palletising so drivers unload without searching.
- Put away the same day: dock-to-stock should be measured in hours, not days.
Warehouse KPIs
What isn't measured doesn't improve. These are the indicators worth reviewing every week, with typical benchmarks for distribution warehouses in the region.
| KPI | How it's calculated | Benchmark | What it tells you |
|---|---|---|---|
| Space utilization | Occupied positions ÷ total positions | 75–85% | Whether the warehouse is running out of room or space is badly used. |
| Cube utilization | Occupied volume ÷ usable rack volume | > 60% | Whether pallets and boxes use the height and depth. |
| Lines picked per hour | Lines picked ÷ picking hours | 60–120 (manual) | Productivity of the most expensive operation. |
| Picking accuracy | Error-free orders ÷ orders shipped | > 99.5% | How many claims, returns and re-shipments the warehouse causes. |
| Order cycle time | Load time − order release time | < 4 hours | How fast the warehouse responds. |
| On-time shipping | Orders loaded before the promised time ÷ total | > 98% | Whether the warehouse keeps the promise to customers. |
| Dock to stock | Put-away time − truck arrival time | < 8 hours | How long received goods take to be available to sell. |
| Unloading time per truck | Unload finish − arrival at the door | < 60 min (container < 3 h) | Dock queues and carrier waiting costs. |
| Inventory accuracy | Locations counted without variance ÷ counted | > 98% | Whether the system reflects what is on the shelf. |
| Cost per order | Total warehouse cost ÷ orders shipped | trending down | Overall efficiency, in money. |
| Perfect orders | Complete × on time × undamaged × correct documents | > 95% | The customer's real experience. |
| Time walking | Travel time ÷ total picking time | < 40% | How much slotting and batching can gain. |
Best practices for efficiency
- Every location with a unique address and label (aisle-rack-level-position).
- Barcodes on products and locations; nothing moves without a scan.
- Slotting by ABC of movements, reviewed every quarter.
- Batch or wave picking when there are many small orders.
- Staff assigned to each hour's workload, not fixed by area.
- Cycle counts instead of an annual stocktake that stops operations.
- FEFO/FIFO for anything that expires or deteriorates.
- 5S: order, cleanliness and clear aisles; what isn't used leaves the warehouse.
- Standard packing stations with materials at hand.
- A daily board with the KPIs at the start of each shift.
Try this
What to remember
- Half or more of picking time is walking: that is where the cheapest savings are.
- Slot by ABC of movements: the most-picked items near the dock and at waist height.
- Grouping orders per trip (batches or waves) cuts trips and metres without hiring.
- Spread the team by workload: the slowest area decides how much leaves the warehouse.
- A warehouse above 85–90% occupancy loses productivity even if it looks like more fits.
- Measure every week: accuracy, lines per hour, dock to stock and on-time shipping.