Ecommerce Warehousing 101 Best Practices Checklist for 2023

The use of e-commerce warehousing has exploded in recent years as many online retailers look for better ways to store and manage the inventory of physical goods before they are sold online.

As this practice grows, it’s vital to identify best practices to optimize your business operations. Modern e-commerce warehousing best practices include:

1. Determine the storage space you need. Planning for your e-commerce warehousing needs involves calculating how much current space you need and planning for future growth and needs. When determining the space you need, it’s vital to not just think about the storage space but include other required activities, including receiving, shipping, and allocating space for returned or undeliverable goods.
2. Using the right warehousing management software to meet your needs. Modern warehouse management platforms offer many features. Some of the most desirable include:
   1. Tracking of inbound receiving and inventory controlPick/pack/ship workflow management to optimize efficiencyUser-defined reports that include your identified KPIs to provide measurable results to track how warehousing activities help achieve the company’s objectives and goalsThe ability to help scale your business to meet any growth goalsProviding real-time data about inventory and product availabilityManagement and monitoring of supply chains, from the manufacturer to the distribution center
   1. Inventory forecasting to help you determine when stock may run out
3. Integrate your e-commerce warehouse systems. Integration of API and KPIs allow your business to share data seamlessly across the company. This benefit can show you opportunities to reduce costs and enhance efficiency.
4. Identify the proper KPIs for your e-commerce warehouse management system. Setting up an e-commerce warehouse is a huge task, which can be made easier by partnering with a reputable warehouse service provider. No matter your method for creating the warehouse, it’s vital to identify the KPIs you want to measure goal progress, identify customer complaints and enhance service, inventory turnouts, and plan for future needs. Some of the most important metrics in warehousing include inventory turnover, rate of returns, and order lead time. Despite this, it’s important to analyze your business needs and identify the proper KPIs. Then you can work with the warehouse to ensure the platform and software can deliver what you need.
5. Ensure you have a controlled and organized system. Excellent organization can improve delivery times, order accuracy, and inventory management. Your organization system should account for all warehousing activities, including picking, packing, taking inventory, labeling, transporting, and tracking until delivery.
6. Distributing your inventory. If your operations are large enough, it may make sense to distribute your inventory across multiple warehouses to reduce shipping costs to the end consumer. When you do this, you can also increase your delivery speeds and provide better customer service. It’s useful to research to determine if multiple warehouses’ cost is worth the investment. For many growing e-commerce retailers, inventory distribution is part of the process while growing the business.
7. Set inventory minimum points. Inventory management can be a constant challenge. Too many products on hand can lead to high inventory carrying costs that eat your profits. Conversely, having too few products can leave you out of stock, sending your customers to competitors when they can’t get what they need from your company. Warehouse management platforms can let businesses know to order more inventory when a product reaches a specific threshold. But to work, you must take the time to define these minimums and ensure the software knows to alert you once they are reached.
8. Select the right warehousing and shipping partners. Most e-commerce retailers rely on third-party warehouse providers and shipping carriers. It’s a business model that makes sense since it can reduce the workload, reduce shipping time and cost, increase order accuracy, and reduce costs. But your company’s reputation is on the line, and the performance of your partners reflects on you. Therefore, it’s worth taking time to ensure you have the best possible partners in the business. This action can enhance your reputation and give you greater visibility. The right partners can be a business asset, while the wrong ones can cost you business, so it’s vital that you select them wisely.

Modern e-commerce retailers must manage many aspects of the business and ensure everything works smoothly. The details of storing and shipping can eat up most of the day. But partnering with the right e-commerce warehousing service provider can take many repetitive tasks off your plate, allowing you to focus on continuing to grow your business. To learn more about the benefits of e-commerce warehousing, contact Dawson Logistics today.