Reduce errors and improve safety.
In today’s world, we would like to believe that implementing technology will make all our problems go away, when in fact, automating already inefficient and inaccurate business practices will enable the distributor to make the same errors at a much quicker rate.
When reviewing your operational performance, take some time to grade yourself on how your business rates in the following best practice areas.
Does your receiving clerk keep a receiving log, indicating dock activity for each shipment by date? This log can prove valuable for reference purposes by purchasing, accounting and in filing claims with carriers and suppliers.
Before unloading a truck, does your receiving clerk check to make sure that the shipment belongs at your dock? Is the shipment at the right branch location? Is the purchase order number valid? A supplier may send a purchase order to the wrong branch from time to time. The supplier may also send duplicate shipments. A carrier may also deliver transfers and purchase orders to the wrong locations. These are good things to know before you unload the truck and sign for the shipment.
Does your receiving clerk sign the delivery bill properly? Is the document dated and signed each and every time? Is the number of pieces or pallets indicated on the bill physically verified before the bill is signed for that exact amount? Is any visible or potential concealed damage noted on the bill? Are you taking advantage of STC “said to contain,” when the bill indicates a piece count on shrink-wrapped pallets that are difficult to count? In most cases, drivers will agree to the STC practice if they understand that it is your policy that all delivery people are involved in the count verification. As a result of using the STC procedure, you will be in a stronger position to file a shortage claim should you find problems after the driver has left.
Do the unloaded shipments sit on your dock for hours or days before they are checked in and put away? This practice can lead to damaged product, pilferage, premature usage and false shortage claims. There is also the potential for additional handling when the dock area is congested.
Are receiving discrepancies noted clearly by line item on the packing list? Is the packing list signed and dated by the individual checking the shipment in? Too often, the purchasing or accounting department has to backtrack to find additional information concerning a receiving discrepancy that was not documented clearly at the time of receipt. Relying on memory after the fact, or even identifying the individual who checked the shipment in can make it difficult to file a successful claim.
Do you have return goods lying around collecting dust? Do you have a clearly understood procedure for documenting why these items came back to you? Are you disciplined enough to use software codes to track how often customers return product and for what reason? Is someone assigned to process the correct paperwork and send the item back to the supplier for credit?
Are your aisles free of congestion, allowing forklifts and carts to move about? Often the aisles become a staging area to make room for the next receipt at the dock. More than likely, you will pick from the skids of product in the aisle, even though it has not yet been put away. In addition, your team will invariably move that product again and again in order to get to product on the shelf. The product also becomes more difficult to locate as it is moved from one area to another. The proper approach is to locate the product in a bin location shortly after receipt and check-in.
Are you preparing for your next receipt ahead of time? Condensing partial pallets within your storage system will ensure that you can put product away directly from the dock or staging area, avoiding the congested aisle scenario.
Are you using bin locations to locate your product? The vast majority of distribution software packages available today utilize bin locations. This allows for immediate, accurate location of products within your showroom and warehouse zones. Many distributors are leery of taking advantage of this tool because of the perceived need to keep vendor lines together. Bin locations, in fact, free you to locate product based on sales volume, thereby reducing the number of footsteps required to pick those key items that tend to show up on a majority of orders. I call this locating your product by velocity rank.
Can you pass the “Temp Test”? Are you able to bring in a new hire or temporary employee and be confident that this individual is productive within two to three hours? Utilizing bin locations provides a map for the new recruit to follow. This allows you to look for someone skilled in the area of material handling. Without bin locations, you will need to look for someone who is experienced within the product lines you carry in order to find the product to fill orders. They will require more hand holding to learn where those different product lines are kept within your four walls.
Are you cycle counting with any consistency? The majority of cycle count programs will ask that you count a certain number of items per day. Your cycle counter will need to know where those products are located. With challenges like multiple storage or overstock locations, congested aisles and a warehouse without bin locations, many distributors give up on cycle counting, citing that it is a waste of time. Many simply elect to correct their inventory variances at year-end. This is not a good practice.
Do you allow your material handlers to ride on the forks of a lift truck through your warehouse? Do they ride up and down on the forks or a pallet in order to pick or put product away? Do you allow them to ride on a pallet jack, propelling it like a scooter throughout your facility? Do they use racking shelves as steps? These practices can be very dangerous. Aside from the possible lawsuits stemming from an injury, OSHA will enjoy a tour of your facility as well. The problems are multiplied for those with multiple locations. A reasonably priced safety cage and a focus on safety can provide a simple solution for riding on lift truck forks, and positioning your high velocity inventory in the center shelves of rack will help in the area of racking shelves as steps. We should all be concerned with safety issues.
Have you really tested your forklift drivers for competency? Too many distributors take an individual’s word that they have forklift experience and then wonder why they are experiencing so much product damage and equipment downtime. If you do not have anyone on your staff certified in forklift training, contact your forklift supplier. They will be happy to help, many times at no cost to you.
Remember, your warehouse operations are one of your primary assets, as well as a great sales tool. Make the right choice and choose to operate with excellence!
|Meet the Author
Dan Belanger is president of The Beltech Group, LLC, a distribution consulting business located in Grand Rapids, Michigan.