The layout of a warehouse may need to be changed to accommodate new product lines or to add greater flexibility to the warehouse operations. When a new warehouse layout is proposed a detailed planning process should be followed to ensure the success of the project. The planning process should include the following six steps.

1. Define Objectives

When deciding on the layout for a warehouse, the objectives should clearly be defined. The objectives should be aligned with the overall warehousing strategy of the company. Objectives can be defined at a high level such as to reduce warehousing costs or to provide maximum customer service. Equally, the objectives can be more specific, such as maximizing warehousing space, providing maximum flexibility in the warehouse, or increasing warehousing efficiency without increasing resources.

2. Collect Information

The specific information of the proposed warehouse should be collected. This includes the specifications of the warehouse from the architectural drawings that can affect storage and material handling. The details should include a physical map of the warehouse space to show columns, doors, height restrictions, docks and storage racks. External features that can affect the receiving, storage and shipment of materials should also be noted.

3. Analysis

After the specific information about the warehouse has been collected the analysis can commence with respect to the objectives that have been defined for the warehouse layout. The analysis should determine if the overall objectives can be met and if not how the objectives can be modified. At this point in the planning process, decisions need to be made by warehouse management to determine what actions need to be taken if the overall objectives cannot be met or will need substantial changes.

If the objectives can be met based on the analysis of the information, the detailed implementation plan can be created.

4. Create Plan

The detailed implementation plan should show all the steps that are required to create the warehouse layout. The objectives and the analysis of the information gathered should be used in creating the plan. The plan should first be at a high level showing the major tasks and then each of those should be sub-divided into the individual tasks that are required. Each task should be reviewed and an allocated the appropriate resources, as the allocation of estimated time required to complete the task. The plan should indicate when a task is required to start and finish based on the availability of resources, either internal or outside contractors, or if it is dependent on another task. The plan should be checked to ensure that all dependencies have been correctly linked. Once the plan has been created it should be checked to see if the timeline is attainable and if there are enough resources are available.

5. Implementation

Sometimes the warehouse layout that is implemented is not the one that is in the plan. This can occur due to unrealistic timelines in the plan, lack of resources, unavailability of outside contractors or poor analysis of the information that was gathered. To ensure that the plan for the warehouse layout is achieved the implementation should be timed so that there is little or no movements of materials in the warehouse. An ideal time for this would be during a plant shutdown or at a weekend if the implementation was of a smaller size. However in modern warehouses, this is not always possible so often additional warehouse resources are needed to keep shipping products during the implementation. If this is the case then this will need to be factored into the plan. The implementation should ensure that all changes made in the warehouse are replicated in the warehouse management system that is operated so that each item can be found. A physical inventory of the products in the warehouse after implementation should be carried out to ensure that the system accurately reflects the warehouse.

6. Post Implementation

After the layout has been implemented, there should be a series of checks to ensure that the layout is exactly as defined by the approved drawings. Every item should be stored according to the overall plan and this should be checked to ensure the layout is correct. If there are errors, this could lead to picking errors or lost material within the warehouse. Shipping could be disrupted if the warehouse systems have not been updated accurately with the correct layout information or if items have been stored in the wrong locations. For a period of time after the new layout has been implemented, regular checks should be made to ensure that the layout is working and that there are no operational problems that have occurred due to the new layout.