Fleet Management & Forklift Safety Blog

Where the Biggest Losses Occur in a Warehouse Organization

Posted by Neil O'Connell, SVP Technology, Innovation, & Product Development on Feb 15, 2017 4:00:00 AM

Do you know where your profits are going? A warehouse runs on numbers, but cutting losses can be challenging since most Warehouse Management Systems (WMS) aren’t effective in quickly identifying where and why money is lost. financial-crisis-544944_640.jpg

If you don’t know where the problem is, how can you fix it? A telematics platform provides that missing component — real-time, actionable insight. Your software should integrate with your WMS, and identify at a glance which KPIs need immediate attention.

Where warehouse losses typically occur

There are key areas (basic KPIs) where your facility maybe taking a loss, but most managers are too busy putting out everyday fires to notice. Here are a few:

  1. Fleet activity or utilization drops – Maybe several lift trucks are down for repairs at once, or some operators are not using their time efficiently. Telematics facilitates proactive fleet maintenance and identifies poor operator behavior so it can be addressed.
  2. Checklists are incompleteSafety checklists protect operators, vehicles, and inventory from breakdowns, impacts, and injuries, all of which result in profit loss.
  3. Trucks are on lockout – Vehicles locked out due to maintenance issues or an impact are costing your enterprise money in repairs and lost productivity.
  4. Impacts increase – Accidents happen, but they should be few and far between. Impacts can cost an enterprise an average of about $38,000 per incident and $150,000 in damages to equipment, property, inventory, and downtime for repairs.
  5. Operator’s lack certification and training – OSHA fines can impact profits if driver certification is not up to date or training doesn’t meet OSHA’s requirements.

How to cut losses with exception-based warehouse management

According to a study by the Georgia Institute of Technology, less than 30% of warehouses in the U.S. are efficient. That means at least 70% of warehouses have room for improvement in terms of operational efficiency. But the existing general information about how to cut losses isn't helping. What busy managers need is a telematics system to clearly identify each issue and to provide actionable solutions.

By integrating a telematics system with your WMS, you get a holistic picture of your entire operation on one screen, quickly learning everything you need to know to manage your day. In real time, you can see which KPIs are going well and any exceptions from the norm that need immediate attention.

With a click of a pull-down menu, you learn exactly why, or which operator(s) are associated with the issue. This can save a manager hours of running reports and trying to determine why a KPI is off target.

Every enterprise has areas where productivity and profits are lost. The solution is leveraging new telematics technology to identify the issues eating away at your bottom line and to tell you exactly what to do to solve them.

Topics: telematics, warehouse operations, CommandPulseDX, KPIs, continuous improvement