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Archives for November 2010

You Might Have A Bad Warehouse If... You are so Busy Selling Product You Forget to Ship It

By Kate Vitasek | 11/15/2010 | 4:03 AM

 This week’s bad warehouse is courtesy of Tom Freese of Freese & Associates. Tom relates a story about a dot com 3PL company who spent their entire time marketing their product and none of it running their warehouse.  

In case you don’t remember the dot com craze, it is often depicted as venture capitalists providing truck loads up money to anyone that had an idea about selling some unique product or service online.   Unfortunately, as Tom points out - little thought was giving to shipping out real truck loads of product that needed to be delivered. 

Listen to Tom’s story.

 

 

Tom is likely in jest (I hope!) when he says the company kicked boxes and licked labels to get their product out the door. But it is no surprise that many folks think warehousing is simply kicking a box around and licking a label. And when you adopt that mindset, you get week long backorders that only get worse and worse and worse.

Tom’s explanation may be tongue and cheek (er…tongue and foot), but it hits home on a good lesson.  I often meet with companies who find they are running a warehouse and have no clue what it takes to do a good job because warehousing is not their core competency.   The company Tom mentioned is exactly the kind that frustrates me the most because they are often the ones who have no clue that they are running a bad warehouse, falling victims to the 50% syndrome (read the section titled False Confidence or Measured Confidence).  Perhaps this is why some companies end up designing warehouses build of cardboard and string.

If anything, this warehouse demonstrates the importance of benchmarking. The only conceivable explanation is that they had no clue about warehousing processes. Had this warehouse been a member of the Warehousing Education and Research Council or attended industry specific conferences, they would have had several opportunities to benchmark and understand the industry better. And apparently the graph on the wall didn’t tell the story of it all for this warehouse to get a clue. Remember, if you are not aware of your position in the market based on your performance or processes as it relates to industry established standards you are in for a rude awakening.

There are tons of resources you can use to determine your “Point A” or starting point, as my fellow DC Velocity blogger Karl points out. And if you are new to benchmarking, don’t worry there’s a book for that too. Below are my suggestions on getting started:

Lesson learned: If you don’t benchmark, you may well find yourself out of business!

I really love your feedback - and love your contributions to share those bad warehouse stories to help educate the profession on what NOT to do, and maybe what to do if you’re not doing it.

If you've got an example of a bad warehouse practice, send me your story and photo(s) to [email protected]. If I feature your example in one of my blogs, WERC will send you a free copy of the WERC Warehousing & Fulfillment Process Benchmark & Best Practices Guide (a $160 value).

Your submission can be anonymous if you like so you don't get your boss or company in trouble! I'll be collecting examples all year and the winner will receive a free WERC Warehouse Certification Assessment by Supply Chain Visions, a $10,000 value. The runner up will win a free conference registration to the WERC conference (a $1,375 value).

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The opinions expressed herein are those solely of the participants, and do not necessarily represent the views of Agile Business Media, LLC., its properties or its employees.



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