In today’s business world, warehouses are playing a major role in supply chain. The alignment and automation of all the warehouse operations are important to meet the demands of customers. Leveraging data analytics improves these processes by enabling businesses to streamline their operations, reduce costs and improve service levels. 

According to a survey in MHI’s annual industry report for 2022, only 28% of leading supply chain companies have adopted automation in their processes as of today, but that number is expected to reach 79% by 2027. (Source: https://www2.deloitte.com/us/en/blog/business-operations-room-blog/2022/closing-the-gap-on-automated-warehousing.html ) 

 The Role of Data Analytics 

Data analytics involves analysing vast amounts of data to derive meaningful insights that allow for informed decision-making. In warehouse operations, data analytics can be used to monitor inventory levels, track the movement of goods, predict demand and improve storage space. By integrating data analytics into warehouse management systems, businesses can gain a complete overview of their operations and identify areas for improvement. 

 Enhanced Inventory Management 

One of the primary benefits of using data analytics in warehouses is improved inventory management. When businesses use the traditional methods of inventory management, it often leads to understocking or overstocking – generating loss to businesses.   

 

According to a report by McKinsey, companies that implement data analytics in their inventory management systems can reduce inventory levels by up to 20%, all the while still meeting customer demand and improving productivity by 20 – 30%. (Source: https://www.mckinsey.com/capabilities/operations/our-insights/digital-transformation-raising-supply-chain-performance-to-new-levels ) With data analytics, one can accurately predict demand and adjust inventory levels accordingly. This has not only reduced holding costs, but also ensured that we always have the right products in stock. 

Optimized Warehouse Layout 

The layout of a warehouse significantly impacts its efficiency. A poorly organized warehouse can lead to longer picking times and increased labour costs. Data analytics can be used to analyze picking patterns and optimize the warehouse layout. By placing high-demand items closer to the shipping area entrance, businesses can reduce picking times and improve overall efficiency. 

According to a study by the Warehousing Education and Research Council (WERC), warehouses that utilize data analytics for layout optimization experience a 25% increase in picking efficiency. (Source: https://werc.org/page/metrics ) 

Automated Processes 

 Automation is another critical aspect of today’s warehouse operations. Automation helps in handling repetitive tasks such as sorting, packing and labelling by reducing human involvements in these tasks. It thus allows employees to focus on other complex activities. Data analytics enhances automation by giving real-time insights into the state of systems allowing for timely maintenance and adjustments. 

Leveraging data analytics for warehouse alignment and automation has various benefits like improved inventory management for better layouts and improved automation. By effectively using the power of data, businesses can transform their warehouse operations, is are more efficient and is are better at meeting the needs of customers. As the industry continues to evolve, the adaptation of data analytics will be important in maintaining a competitive edge and driving operational success. 

CRG solutions can partner with you on this and provide additional expertise and support throughout.  

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