How to Optimize the Warehouse Receiving Process

It’s not uncommon to see small and mid-size warehouses struggle with operational inefficiencies. In meeting with many warehouse managers and carefully analyzing their warehouse operations, one common problem that surfaces is a lack of standard processes and specialization within the warehouse.

To address this, we’ve decided to write about the standard processes that should exist in a warehouse. These are: receiving, put-away, storage, pick & packing, and shipping.

We will provide an outline of the tasks that should be happening within each of these processes as well as the technologies and best practices to increase warehouse efficiency, reduce errors, and increase safety.

Warehouse Receiving Objective

When we talk about running an efficient warehouse operation, the receiving process is imperative. It’s important to keep in mind that the purpose is to receive the right product, in the right quantities, in the right condition, weight, and dimensions all at the right time.

The proper receiving of goods will have a direct impact on all subsequent warehouse processes. Let’s dig into it.

Pre-receiving

For the warehouse receiving process to run efficiently, you’ll need to establish and enforce receiving requirements for suppliers, shippers, and/or carriers. The objective is for them to present the cargo in a way that is quick and easy to process.

When working with suppliers, if possible, have the warehouse manager coordinate packaging requirements such as:

• Label position
• Label Information
• Palletized or loose cargo
• Number of packages per pallet
• Items per carton
• Acceptable package size & weight

In the case of shippers or customers that don’t have control over packaging, require them to provide clear, detailed information and notify the warehouse of new incoming shipments. Often, freight forwarders receive cargo that doesn’t clearly state who the consignee or final recipient is.

As for the carriers, very often they fail to organize cargo according to the order of the delivery route, resulting in cargo having to be unloaded to reach the goods actually being delivered at a location. Another problem is drivers not having all documentation in hand when they arrive to the receiving area.

To minimize these issues, inform all carriers that proper documentation must be in hand upon arrival and cargo must be organized in relation to the delivery route.

Let them know your business will not be responsible for any delays or potential penalties that result from failure to comply with these recommendations.

Keep track of suppliers, shippers, and carriers that create the most problems.

Finally, try to receive cargo as palletized whenever possible. Not only will this help you speed up the receiving process, but it’ll also reduce cargo damage and help speed up subsequent warehouse processes. 

Labor and Booking

Another important aspect of improving the warehouse receiving process is to allocate the proper number of man hours. Failing to properly account for the volume and type of cargo coming through the gates results in under or over-allocation of human resources.

Considering that labor is among the highest of warehouse operational costs, matching workload demand with workforce supply is critical.

“As the typical warehouse’s largest operating expense, labor costs can eat up anywhere from 50 to 70 percent of the average company’s warehousing budget.”

To avoid under or over allocation of resources (labor or equipment) and/or a collapsing receiving process, warehouse managers must define times and dates on which cargo is received. This should be a decision of the warehouse manager and not the carrier. 

By knowing what cargo comes in and at what time, warehouse managers are able to match workload demand with workforce supply.

To accomplish this in an organized and effective way, warehouse managers can use a booking or scheduling software where the carrier can pre-book the delivery and the warehouse manager can review and process the bookings.

Because this option might be impractical in some cases (for example parcel carriers like FedEx & UPS) managers can setup “on-demand receiving teams” and allocate specific docks to process carriers that will not comply with this requirement or drivers that missed their appointments.

Unloading

In general, the objective during the unloading process is to unload cargo safely and efficiently. 

Part of this process includes checking seals, recording temperature data (in the case of perishable goods), and validating the booking reference. Once this is completed, assign a bay and start the unloading process.

For the unloading process to be efficient we need to make sure that the labor hours are properly allocated and the right equipment for the job is available.

When unloading palletized cargo, keep in mind not only speed but safety.

If a forklift is used in this process, receiving personnel must ensure the truck is properly docked and emergency brakes are on so that the trailer can handle the weight and container integrity is not compromised. 

Taking advantage of warehouse technology can be beneficial here. For example, to optimize the safety check and speed up the unloading process, the use of Power Pallet Trucks is recommended.

When loose cargo is being unloaded from a container, warehouse managers must avoid this being done by hand. Doing so is not only inefficient, but also exposes personnel to risk of injury from excessive bending and stretching. 

For the unloading of loose cargo, warehouse managers should consider the use of conveyors. While regular conveyors will help reduce inefficiencies and increase personnel safety, the use of telescopic boom conveyors will dramatically reduce safety hazards and processing time.

Using conveyors will also allow for receiving personnel to start the sorting process within the container.

Verification

The final step in the receiving process is to conduct a standard verification process that includes checking of quantity received, description of goods, product code, and condition of cargo – whether damaged or not.

In other cases, it might be necessary to conduct a more advanced verification that entails checking for cargo’s weight, dimensions, temperature, batch/lot number and serial code.

IMPORTANT: A critical part of the verification process is to record and report any discrepancies between what is expected and what is received.

One of the most time-consuming and labor-intensive tasks is counting and verifying damaged cargo. The three common approaches to execute these tasks are:

• Individual item count
• Count of pallets
• And following Good Faith Receiving – more predominant among retailers

For those companies required to count one item at a time, the use of warehouse technology such as barcode scanners or RFIDs integrated with the Warehouse Management System (WMS) is essential to speed up counting and reduce errors.

Another approach to speeding up the process is to conduct random checks and keep record of all missing and/or damaged cargo and its supplier, shipper and/or carrier. Once enough data has been collected, receiving clerks will put focus on those suppliers, shippers and carriers with the most recurrent problems. The warehouse manager should also use this data to make these companies aware of the problem.

For companies needing to prove to their customers the state in which cargo was received, the use of digital cameras installed on conveyors or freight dimensioning systems and integrated with the WMS can dramatically increase the speed of the image-capturing process. Image(s) can then be shared through the customer portal and/or mobile applications.

On the other hand, for warehouses required to verify weight and dimensions, weighing scales integrated with parcel/pallet dimensioning systems and the warehouse management system are an excellent option for capturing all this information quickly and without errors.

To run efficiently, warehouse operations must start with an organized receiving process. While receiving, they must make sure they fulfill at least the standard tasks (pre-receiving, labor and booking, unloading, verification) and incorporate some of the best practices and warehouse technology described in this article.

Remember, the lack of process-oriented operations is one of the biggest problems affecting warehouse efficiency and safety today.

If you are ready to find the solution to optimize your warehouse, go to our Solutions Finder tool.