First things first. In warehouse logistics, it means right location and facility

In my twenty years in warehouse logistics industry, I have visited a lot of companies and warehouses in Scandinavia. The view of warehouse logistics vary greatly between companies, also the degree of maturity in development and knowledge regarding warehouse logistics. The priorities regarding investments and focus of development can differ significantly from company to company and sometimes surprises me. There is really no right or wrong. However, I wonder sometimes why companies keep invest in some warehouses even if the location and/or facility is so obviously wrong. Remember you can never compensate a bad location or bad facility with high-end technology like automation and so on. You have to prioritize right to get the maximum potential from your investments

First, you have to decide the physical location of warehouse. Choosing the right warehouse location can make all the difference in how efficient and profitable a company is. Leasing or purchasing a warehouse is a major decision, and choosing the right location can significantly enhance a company’s ability to compete and effectively serve customers. It affects for example inbound and outbound transport costs, workforce availability and labor costs. I understand a startup company do not think of this in the beginning but if your company starts to grow and become a success you need to make a strategic decision soon as possible. The longer you wait, more expensive will a relocation be. Even if you cannot invest in a relocation now you can stop all investments in your current facility. I have seen warehouses out of civilization but the company have invested so much money in automation and conveyer systems that it is almost impossible to do a relocation. If you make the decision in time, you do not risk ending up in a situation like that.

Second, what facility should you choose? I have seen the strangest warehouses you can imagine. I wonder who have been in charge and not decided to move! They have often invested in advanced conveyer systems, automation and so on everything to be able to handle the growth in current buildings, but it never end up good, too much compromises because of the facility. As in the above point, I understand a startup company use a cheap building often made for another kind of business but it is very important you relocate soon as possible if your business start to grow. I write it again, you can never compensate bad locations and facilities with technology. If you try that, you have made double mistakes. You need to start in the right order. When looking for a new warehouse, you should consider the longevity that it can offer. It is important that you do not outgrow the storage facilities too quickly. Analyzing figures that indicate the potential growth of your business should be carried out before you start searching for your ideal warehouse, and then you can factor this in to the space requirements.

If you think of warehouse relocation or moving to another facility in near future. Focus on leadership and WMS. You can make a lot with that. Both are also very important in a moving process of a warehouse. An established WMS can handle a warehouse move easily, often you can scale up your current system with the new warehouse. That make the moving transactions to new locations easy.

If you have the right location and have the right facility for your purpose, read my blog to develop your warehouse to world-class standard.

Roberth Karlsson

1 Comment

  1. Depending on the products to manage, the solution is a 3PL. Short and medium term contracts open the possibility to move to a better site, more suitable to ones needs.

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