What SKU Data Do I Need to Design My Warehouse?
When it comes time to begin designing a new warehouse or retrofitting an existing order fulfillment facility, it’s important for you to have access to the right data points in order to answer the appropriate questions which include: What will the square footage of the warehouse be once complete? How many workers will need to be accommodated? What is your total order cycle time? How many orders are processed each day, and what is your peak rate?
All of figures are important for you and your warehouse design consultant to obtain, but few data points will impact the design and layout of your facility to the degree that SKU data will.
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SKU Data Required for Warehouse Design
SKU data is important to warehouse design because your inventory dictates not size and capacity for on hand inventory and forward pick areas, but also the general flow and layout of your order fulfillment and assembly areas within the warehouse. If you don’t take your SKUs into consideration when planning a new facility, headaches are sure to abound.
Here are four important pieces of information about your SKUs that you need to know before sitting down to design and plan your new warehouse.
1. How many active SKUs does your facility handle today?
The number of active SKUs currently handled in your facility—and the quantities in which you handle them—is a data point that will have the most direct impact on space utilization, and as such is incredibly important to know before designing a new order fulfillment warehouse. On its most basic level, this data will inform how much physical space you must devote to storing inventory.
But the number and variety of active SKUs will also stratify each sku into different types of storage based on the amount demand for that item and the number of orders an item appears upon over time. This approach can reduce replenishment labor by sizing the pic slot large enough to prevent having to constantly bring product into it.
2. How many SKUs will your facility handle in the future?
Just as important as the number of active SKUs (and the quantity of those SKUs) handled by your warehouse today is the number of SKUs (and the quantity of those SKUs) that you expect your warehouse to handle tomorrow.
Do you expect the number of active SKUs handled to grow, shrink, or remain the same over the course of the next 3, 5, 10 years? How rapidly do you expect this growth or shrinkage to occur? If you are in an industry that has been experiencing SKU proliferation, do you expect this trend to continue or taper off?
Your answers to these questions will impact the layout and design of your facility. By accounting for the expected change in the number of SKUs (whether growth or shrinkage in the number of active SKUs), the new facility is safeguarded against the need for a retrofit or upgrade in the short term, which saves capital investment in the future while limiting increased overhead today.
3. What are the design specs of the SKUs your facility handles?
The design specs of your various SKUs directly impact your warehouse design in a number of ways. Specs like size (length, width, height, weight, etc.) are critical, but equally as important are things relating to unit of measure of the saleable unit. Whether it is a break pack quantity, the number of units in a case, or general palletization info (such as ti and hi info), all of these data points are critically important to know so that you are not speculating or making risky assumptions.
Crushability is an important spec to have for packing, and characteristics such as weight distribution may impact how you transport your specs (by hand vs. conveyor, etc.). For example, items that are top-heavy may topple if they are placed on a sorter vertically that accelerates or decelerates aggressively to create gap.
4. What specific storage requirements do my SKUs have?
Do your SKUs need to be kept in a refrigerator? In a freezer? In a climate- or humidity-controlled environment? Is LOT control or traceability a requirement for your items, and do you need to store and segregate multiple item types?
All of these factors will impact the design, layout, and flow of your warehouse. The need to incorporate different types of storage must be accounted for from the very earliest moments of planning, simply because it will impact the footprint of your facility.
But different storage requirements will also impact your workflows—the ways in which you handle, package, and transport your goods—and this will impact the technologies that your warehouse design consultant may recommend.
Allowing SKU Data to Inform intelligent Warehouse Design
Taken together, these points of data (number of active SKUs handled in your facility, estimated future number of SKUs to be handled in your facility, design specs of SKUs, and storage requirements of SKUs) will all impact the final design, layout, and flow of a warehouse or distribution center. As such, it’s important to have the data on hand before you ever begin to think about a new designing a new facility or retrofitting an existing facility.