Best Practices in Warehouse and Distribution Management

Warehouse and distribution management continues to evolve as companies adapt to changing market demands and technological advancements. With logistics growth holding steady in October, companies like C.H. Robinson are expanding operations to meet rising order volumes and the increasing complexity of supply chains. This article examines the current best practices in managing warehouse and distribution networks, drawing from recent developments and industry insights.

Expansion and Adaptation in Logistics

In a significant move, C.H. Robinson has expanded its operations in El Paso with the establishment of a new 450,000 square-foot facility. This expansion is part of a broader strategy to adapt to the steady growth in the logistics sector observed in October. As volatility becomes the new norm in warehousing, logistics managers are increasingly facing rising order volumes. To handle these challenges, third-party logistics providers are turning to automation to enhance efficiency and manage the complexities of modern supply chains.

The Role of Technology in Supply Chain Management

Artificial intelligence (AI) is playing a transformative role in logistics and supply chain management. AI-driven tools are improving freight matching, making the process more efficient and responsive to market needs. However, despite these advancements, supply chain technology still falls short in some areas, indicating a need for continuous improvement and adaptation. Companies are also engaging in network studies, such as those conducted with St. Onge, to build new distribution models that leverage AI and other technologies.

Optimizing Distribution Networks

To optimize distribution networks, businesses are transitioning to multi-facility models. For example, a company recently opened a second distribution center (DC) in Salt Lake City, Utah, transitioning to a two-facility distribution network. This strategy has reduced order cycle time and improved customer service cycle time by providing faster replenishment, which reduces stockouts. Additionally, the presence of a second DC offers business continuity and resilience against disruptions.

An integrated project team was formed to understand the underlying business issues and assess warehouse operating costs. This team was tasked with establishing logistics objectives for the future network and identifying logistics modeling scenarios. The optimal location for these facilities was determined to be near Cherry Hill, NJ, after considering demographics and business costs. The implementation plan took over six months but resulted in significant improvements in efficiency and service levels.

Future Considerations and Continuous Improvement

As logistics teams continue to study the need for additional facilities, such as a potential third DC, ongoing assessment and adaptation remain crucial. The process of expanding and optimizing distribution networks requires a deep understanding of business issues and careful planning. By employing best practices in warehouse and distribution management, companies can better navigate the complexities of modern supply chains and meet the demands of an ever-changing market.

“Volatility is the new norm in warehousing, and companies must continuously adapt to remain competitive.”

In conclusion, the integration of AI, the expansion of distribution facilities, and the strategic use of automation are among the best practices in warehouse and distribution management today. As companies like C.H. Robinson demonstrate, staying ahead in logistics requires a commitment to innovation and a willingness to embrace new technologies and methodologies.