Careers Business Ownership Warehouse Layout for Optimizing Supply Chain Impact Share PINTEREST Email Print Tetra Images / Getty Images Business Ownership Operations & Success Supply Chain Management Sustainable Businesses Operations & Technology Marketing Market Research Business Law & Taxes Business Insurance Business Finance Accounting Industries Becoming an Owner By Martin Murray Martin Murray Twitter Martin Murray is a former writer for The Balance Small Business, and the author of eight books on supply chain management and enterprise resource planning. Learn about our Editorial Process Updated on 09/02/19 The layout of a warehouse may need to be changed to improve supply chain management and warehouse operations. When a new warehouse layout is proposed, a detailed planning process should be followed to ensure the success of the project. This planning process should include the following six steps: Define objectivesCollect informationAnalyze the necessary changesCreate a planImplement the planPost Implementation Define Warehouse Layout Objectives When deciding on the layout for a warehouse, the objectives should clearly be defined. The objectives should be aligned with the overall warehousing strategy of the company. Objectives can be defined at a high level such as reducing warehousing costs or providing maximum customer service. Equally, the objectives can be more specific, such as maximizing warehousing space, providing maximum flexibility in the warehouse, or increasing warehousing efficiency without increasing resources. Collect Information The specific information about the proposed warehouse should be collected. This includes the specifications of the warehouse from the architectural drawings that can affect storage and material handling. The details should include a physical map of the warehouse space to show columns, doors, height restrictions, docks, and storage racks. External features that can affect the receiving, storage and shipment of materials should also be noted. Analyze the Necessary Changes After the specific information about the warehouse has been collected, the analysis can start with respect to the objectives that have been defined for the warehouse layout. The analysis should determine if the overall objectives can be met and, if not, how the objectives can be modified. At this point in the planning process, decisions need to be made by warehouse management to determine what actions need to be taken if the overall objectives cannot be met or will need substantial changes. If the objectives can be met based on the analysis of the information, the detailed implementation plan can be created. Create a Plan The detailed implementation plan should show all the steps that are required to create the warehouse layout. The objectives and the analysis of the information gathered should be used in creating the plan. The plan should first be at a high level, showing the major tasks, and then each of those should be sub-divided into the individual tasks that are required. Each task should be reviewed and allocated the appropriate resources, including the allocation of estimated time required to complete the task. The plan should indicate when a task is required to start and finish based on the availability of resources—either internal or from outside contractors—or if it is dependent on another task. The plan should be checked to ensure that all dependencies have been correctly linked. Once the plan has been created, it should be checked to see if the timeline is attainable and if there are enough resources are available. Implementation Sometimes the warehouse layout that is implemented is not the one that is in the plan. This can occur due to unrealistic timelines in the plan, lack of resources, unavailability of outside contractors, or poor analysis of the information that was gathered. To ensure that the plan for the warehouse layout is achieved, the implementation should be timed so that there is little to no movement of materials in the warehouse. An ideal time for this would be during plant shutdown or on a weekend if the implementation is on a small size. However, in modern warehouses, this is not always possible, so often additional warehouse resources are needed to continue shipping products during the implementation. If this is the case, then this will need to be factored into the plan. The implementation should also ensure that all changes made in the warehouse are replicated in the warehouse management system so that each item can be found. A physical inventory of the products in the warehouse after implementation should be carried out to ensure that the system accurately reflects the warehouse. Post Implementation After the layout has been implemented, there should be a series of checks to ensure that the layout is exactly as defined by the approved drawings. Every item should be stored according to the overall plan and this should be checked to ensure the layout is correct. If there are errors, this could lead to picking errors or lost material within the warehouse. Shipping could also be disrupted if the warehouse systems have not been updated accurately with the correct layout information or if items have been stored in the wrong locations. For a period of time, after the new layout has been implemented, regular checks should be made to ensure that the layout is working and that there are no operational problems that have occurred due to the new layout. These checks should include cycle counts and regular physical inventories.