Improving warehouse efficiency starts with knowing what you are actually trying to achieve. Going faster might allow you to serve more customers, but without the right processes in place it can also increase stock loss and damage.
How to Measure Warehouse Efficiency
You need to know where you currently stand before making any changes to your warehouse operation. Without a baseline, it is impossible to know whether your changes are actually making an impact. These are the key metrics used to measure warehouse efficiency:
Order pick rate – number of order lines or items picked per hour, per operative. This is one of the most direct indicators to see how productively your warehouse floor is operating. Industry data puts the average at around 71 picks per hour, though this varies significantly depending on the operation, product type, and level of automation.
Inventory accuracy – percentage of stock records that match what is actually in the warehouse. Inaccurate inventory causes orders to be missed, emergency replenishment, and time wasted on looking for stock that is not where it should be.
Cost per order – total cost of processing and fulfilling a single order, including labour, packaging, and overheads. Tracking this over time shows whether operational changes are genuinely reducing costs or merely shifting them elsewhere.
Space utilisation – percentage of available storage capacity that is actually being used. There needs to be a balance between making the most of the space and leaving some headroom to avoid operational problems, bottlenecks, and making the warehouse easier to run day-to-day.
Order fulfilment time – time between an order being placed and it leaving the warehouse. Shorter fulfilment times reduce holding costs and improve customer satisfaction.
The ideal is to improve all of these at the same time – to do more while spending less money. A well-run warehouse operation will improve customer satisfaction, while improving staff wellbeing and reducing costs. The sections below cover the most effective ways to improve your warehouse efficiency.
1. Optimise Warehouse Storage
The most effective way to improve your warehouse’s efficiency is by optimising its storage space. This is possible by increasing storage capacity and installing storage systems to utilise untapped space. By installing different products, your warehouse can do this effectively and ensure efficiency for all staff members. In a recent project with RAJA UK, SEC’s storage solution increased pick rate efficiency by up to four times by increasing the density of the storage capacity.
Four of the best ways to optimise warehouse space is by installing mezzanine floors, integrating warehouse robotics, pallet racking, and shelving.
Install Mezzanine Floors
Installing a mezzanine floor means you create more space in your warehouse, without having to move properties. That’s why they’re often a cost-effective option for a variety of industries. They will also increase the value of your property in the long-term, as well as efficiency right now.
A mezzanine floor is built between two main floors in a building or its floor and ceiling. This intermediate flooring utilises the free vertical space within a property. So even if your warehouse’s floor space is full, mezzanine floors create more storage above the existing space.
Mezzanine floors support the integration of different elements of your business with one another. This improves efficiency as collaboration is easier, storage is simpler, and order picking is faster.
Integrating Warehouse Robotics
Another highly effective way to optimise warehouse storage and improve efficiency is through the integration of warehouse robotics. Robotics solutions can automate a variety of tasks, helping warehouses maximize space utilisation, increase productivity, and reduce errors.
Robotics can enhance vertical storage by utilising automated storage and retrieval systems (AS/RS), which efficiently manage high-density vertical space. According to The Network Installers, AS/RS systems have been shown to save up to 85% of storage space while cutting manual labour requirements significantly. Robots also streamline inventory management by automating stock checks, ensuring accuracy and reducing the need for manual intervention. Additionally, Autonomous Mobile Robots (AMRs) improve product movement, transporting goods efficiently within the warehouse and optimising space usage by minimising human traffic in aisles.
Implement Pallet Racking
Pallet racking is a storage system where products are stored on pallets. There are many different forms of pallet racking, however, all forms utilise horizontal rows on multiple levels. They improve warehouse efficiency by optimising space, making order picking more convenient, and increasing staff safety.
Different types of pallet racking will store products in various ways. For example, double deep racking stores items two deep. Other options require specialist picking equipment, rather than a forklift, because of the high-density storage they provide. Whatever racking system you install will increase storage space, both vertically and on the warehouse floor.
Improving the Shelving
Installing industry-leading shelving will transform your warehouse’s efficiency. Where they’re different from racking systems as items are often picked from shelving by hand, while racking may require mechanical equipment to retrieve products. Utilising shelving in an effective installation improves your warehouse’s storage space, service speed, and allows you to store items you may not have been able to before.
Heavy-duty shelving can hold large products securely. They also make the order picking process more convenient for staff to remove the item. Shelving can also be designed and installed based on your warehouse’s needs, which allows you to improve areas where there is a lack of efficiency.
2. Improved Application of Software
Installing high-quality, effective software will improve your warehouse efficiency. Warehouse management systems are a great example of this software. These systems are management software applications designed for ease of use, to support your staff, and optimise how you operate.
A warehouse management system (WMS) supports staff to supervise the logistics and operations of a business. There are three main types of WMSs: Standalone, Cloud, and Integrated, which is a hybrid of cloud and standalone systems. This management software monitors inventory levels, organises the placement of incoming goods, and optimises the picking of inventory. It also performs demand forecasting, advising on inventory control to inform staff when to restock your warehouse.
When choosing a WMS, it’s important to analyse your warehouse’s requirements. Plan for the future and install software that can scale as your organisation grows. Here are examples of standalone and cloud-based WMSs:
Standalone WMS
This system can be combined with existing or future software. Its functions include expiry date tracking, barcode scanning, cycle counting, receiving and putting away items, slotting, picking, and shipping purchase orders. The system is ideal for SME businesses, however, it may not integrate effectively with other software.
Cloud-Based WMS
This system is a web-based software as a service (SaaS) that uses cloud computing technology. Using the cloud ensures improved flexibility, scalability, and security. Disaster recovery is also a significant benefit as you remove the risk of data loss or damage from cyberattacks. According to IDC, over 80% of warehouses are expected to rely on cloud-based WMS solutions by 2027, driven primarily by the need for greater operational agility and lower infrastructure costs.
Your choice of WMS should also take into account the useability of the software. This includes both the frontend and backend – the interfaces your team will use in the warehouse itself, and those used by the team who perform software maintenance. You should also take into account how much software development is required for the system to deliver what you need, and how any custom development will be supported going forward. A system that delivers improved efficiency, but costs more to maintain and update, might not help meet your goals for overall efficiency.
3. Overall Warehouse Layout and Design
When you’re thinking of ways to improve your warehouse efficiency, ask yourself: is your warehouse designed around your current processes? Your warehouse’s layout and design should support your staff in their roles. The design should also be set up in an optimal way to match the requirements of your business.
The most effective way to create a warehouse layout to enhance how your business operates is by using simulation and virtualisation. SEC’s in-house, AI-driven, warehouse design platform DIDO drives this process, analysing your operational data to model different system scenarios and identify where the real efficiency gains are – before any physical changes are made.
This service involves our staff working with our clients to analyse operational data. Once we have accumulated enough data, our team will implement measures to improve your warehouse’s current operations. We then create long-term strategies to manage growth and future-proof your organisation.
Our analysis focuses on types of products, stock volume, the supply chain, and storage capacity. We will also discuss any problems your staff commonly have to deal with, so we can find the right solution that improves your warehouse’s efficiency. Any strategies we implement are based on providing efficient warehouse storage and a high ROI.
4. Staff Incentive Plans
Your staff are a vital part of your warehouse process. They have the experience and skills that can make a significant difference to how your warehouse operates. This is why new software, storage systems, and technology can be effective, however, staff incentives can also improve warehouse efficiency. Once you have an efficient process, encourage staff to follow it through incentive plans such as offering prizes for meeting certain targets and reward staff while encouraging others to improve their performance.
Creating a structured bonus plan could ensure everyone understands the prizes and provide the opportunity to highlight deserving employees. Staff incentive plans encourage people to learn and follow the processes thoroughly, which will lead to improved warehouse efficiency.
5. Staff Training
A new warehouse solution is only as effective as the people operating it. Your warehouse staff are the ones interacting with the system every day – the way they pick, replenish, and move through the space directly determines whether the efficiency gains you’ve invested in are realised in practice.
The most successful operations are the ones where staff are fully onboard with the solution from the outset, and tend to see results more quickly than installations handed over without proper training. Understanding why a layout has changed, how a new racking system works, or what a WMS is asking them to do makes the difference between a smooth go-live and a slow, frustrating one.
When SEC installs a new warehouse solution, training is delivered on-site alongside supporting materials that staff can refer back to once the project team has left. The goal is not just familiarity with the new setup, but genuine confidence in using it, so that the people running the warehouse day-to-day can do so without second-guessing the system.
If you are planning a significant change to your warehouse operation, involve your staff early. Brief them on what is changing and why, give them the opportunity to ask questions during the process, and make sure training is built into the project timeline rather than treated as an afterthought at the end.
Improving warehouse efficiency rarely comes down to a single change. The operations that see the most meaningful results are the ones that take a joined-up approach – looking at storage, layout, software, and people together rather than in isolation.
At SEC, every warehouse solution we design, supply, and install is built around the specific requirements of the operation it is going into. If you are looking at how to improve your warehouse’s efficiency and want to understand where the real gains are in your operation, get in touch to speak to a member of our team.
Choosing the right warehouse storage solutions is crucial for any organisation. There are many types of warehouse storage systems to choose from, each with their own advantages. From static shelving and pallet racking to multi-tier racking and mezzanine flooring, making the right choice for your operations can feel daunting. With the right guidance, however, you can cost effectively transform your workplace’s operation efficiency and storage capacity.
As consumer habits are shifting rapidly towards online purchases, fast, reliable, and scalable supply chain management is not just an advantage but a need of the hour.
AMRs enhance efficiency by automating repetitive tasks, reducing the time and labour required, and allowing human workers to focus on more complex activities, ultimately boosting overall productivity.
Warehouses and distribution centres facilitate the flow of goods between businesses and consumers. Optimising the processes within a warehouse improves the efficiency of that workflow. Maximising storage capacity, increasing put away and retrieval times, improving pick accuracy and reducing picking time all contribute to improvements in productivity.
In a warehouse environment, mezzanine floors are typically installed to create additional usable space, increase storage capacity, and operational areas without changing the footprint of the building.
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