Overtime hours are one of the biggest drags on our bottom line, just in labor doing processes that often can be avoided. A warehouse can quickly become a loss leader if these secret tips are never introduced to your operations.
1. Stop doing full inventory counts!
Probably the biggest loss leader and most common cause of burning overtime hours is having to stop manufacturing, shipping, and receiving product so you can figure out what you actually have to promise. It looks bad to your customers who are standing in line to give you money, and that doesn’t include your staff.
Working weekends is hard enough, but knowing that work is just piling up meaning Monday is going to require more overtime is just hard on your people. Too much and you can lose your best team members to other companies.
The solution: Cycle Counts. You can do periodic counts of just a portion of your inventory that wont require you to stop production at all. Proper Inventory Control software, like QStock Inventory, has functionality allowing you to keep your inventory more accurate, without stopping your business.
2. Pick like a grocery shopper
Many businesses grow so fast that they don’t take the time to organize their warehouse, and often get sent all over picking product for orders. For smaller shops this isn’t a big deal, but when you get to a few thousand square feet and multiple pickers, this can become your biggest cost of sales.
The Solution: Chose a starting point that everyone starts picking from and put your fastest moving items at the beginning. the closer to the end, the slowest moving items. You will find many times your pickers will skip entire aisles saving them precious minutes per order.
Bonus: Systems like QStock Inventory will order your pick ticket to make sure you follow the correct pick path and don’t miss anything on your way.
3. Wasting time on indirect labor
When I was a warehouse supervisor one of my biggest issues was indirect labor hours used cleaning, damaged product, and mixed product in bins. Perhaps you have dealt with this too? Looking back at the end of a small shipping day and having to justify overtime hours, but still having so much “stuff” needing to get done.
The Solution: We got together and decided each employee would be responsible for one aisle or area and were held accountable if it ever had an issue. This caused a bit of a stir, especially the first time someone got in trouble. Within a short period, the warehouse was cleaner, miss-picks decreased, and damage dropped.
I sincerely hope that you can find something in this post that can help you reduce overtime hours in your business. There are better ways to stimulate our economy than spending overtime.
What have you done to reduce overtime hours in your business?