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What is Slotting in a Warehouse? Benefits & Tips for Optimization

November 8, 2022
Optimizing Warehouse Slotting is an Easy Way to Reduce Labor Needs

Automation is the ultimate answer to the question of how to significantly reduce labor requirements and increase productivity in a warehouse operation, which in turn increases profitability.

Guide to the Basics of Warehouse Automation

Short of automating your entire warehouse, however, instituting an intelligent slotting system for your products will also increase productivity while reducing the labor hours to move, store and replenish your product and to fulfill your orders on a timely basis.

What is Slotting in a Warehouse Business?

Slotting is a process of organizing product inventory to maximize space and efficiency in the warehouse. It is an integral part of the warehouse design process to optimize product flow for maximum picking, packing, and shipping efficiency.

By reducing travel time, proper slotting increases efficiency for moving, storing, replenishment and picking for order fulfillment. The old adage “time is money” holds true for warehouse cost savings as well. If the storing, replenishment, and picking of goods are more efficient, fewer workers can complete the same amount of work in the same amount of time.

Step 1: Conduct a Product Usage and Slotting Analysis

The first step is to perform a product usage and slotting analysis.

During the design services phase, it is recommended that you have a detailed slotting study performed, especially if your operation is stocking and shipping thousands of SKUs.

One option is to use slotting software to perform SKU velocity analysis to determine the highest moving SKUs and recommend ideal slotting positions for them in “Golden Zones” along with an ideal A, B, and C velocity storage and picking map.

This early evaluation will also help establish the right type, ideal size, and quantity of storage racks/shelves.

The goal is to maximize storage space and minimize replenishment labor. The storage improvements you make, combined with creating an optimized path for picking operators, will shorten travel time anSd reduce labor requirements in picking operations.

For example, when undertaking such an analysis for our clients, Numina Group conducts a thorough lean analysis with design and time studies, incorporating value stream mapping to drill down into each process, eliminate waste and non-value-added touches.

This highly visual analysis tool enables us to identify redundancies, gaps, disconnects, and bottlenecks in your system. We conduct in-depth lean analysis of current and proposed distribution processes, analyzing product slotting,  profiling, and SKU velocities.

What is a Slotting “Golden Zone?”

The Golden Zone refers to the slotting position that is knee-to-shoulder height range along the shortest pick path to the packing area to eliminate wasteful picker “wander time.” 

Most distribution operations have an 80/20 or 70/30 product profile in which 20-30% of the total SKUs represent most of the products shipped.

Proper use of the Golden Zone provides ample opportunities to create huge efficiency gains and profits.

What are the Benefits of Improved Slotting?

Improved SKU slotting yields instant efficiency gains. Benefits include picking and replenishment productivity boosts gained or achieved by identifying and grouping products with “like” order shipment profiles together, minimizing travel paths, and improving workplace safety by slotting high movers ergonomically.

How Often Should Slotting Analysis Be Performed?

Target your re-slotting audits to occur monthly or, at the very least, quarterly. 

If you plan to implement an automated warehouse system to streamline picking, packing, and shipping, conduct a product slotting analysis early in the design and engineering process.

The warehouse design study will also recommend improved practices, including how to manage and regularly perform slotting improvements (not just once a year).

Target your re-slotting audits to occur monthly or, at the very least, quarterly.

Learn more about Numina’s Warehouse Design and Engineering Services

Numina Group provides comprehensive warehouse design and layout services, beginning with a holistic approach that analyzes processes and people. Next, we determine the technologies that provide the maximum profitability and the fastest return on investment (ROI). 

Our experience and expertise in warehouse design sets us apart from the competition. We provide massive labor reduction and cost savings through the combination of automation and lean design.

Numina Group will optimize order flow throughout your entire operation, providing an immediate ROI. Our in-depth warehouse design solutions include:

  • Design and time studies
  • Product slotting and profiling
  • SKU velocity
  • Footprint requirements
  • Blueprint of optimized design for maximum profitability
  • Technology selection
  • Return-on-investment (ROI) analysis
  • Guaranteed performance

By identifying these areas through data analysis in a visual approach, we can make strategic decisions together to eliminate waste and provide value in all aspects of your automated warehouse system.

Our warehouse design and layout services have helped clients double and even triple their productivity per employee. Typical productivity gains of 35% to 50% have been achieved hundreds of times across a plethora of industries including: omni-channel, e-commerce, consumer goods, healthcare, pharmaceuticals, electronics, third-party logistics (3PL) and many more.

The Numina Group has designed and implemented over 1,000 warehouse automation projects in diverse warehouse environments across North America.

We offer one of the industry’s most advanced engineering teams with deep experience in testing, evaluating, and installing various software and material handling technologies.

Let us put our extensive industry-focused knowledge to work for you.

Ready to learn more? Contact the Numina Group today. 

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