Efficient warehouse management is crucial for small businesses that are into product manufacturing or trading. As an industry-proven ERP tool, SAP Business One (SAP B1) enables warehouse management by keeping track of the inventory flow – right from procurement to sales.
For small companies, it’s equally important for them to optimize their warehouse layout to reduce human labour and utilize the available space effectively. Similarly, by optimizing the placement of fast-moving products in the warehouse, companies can minimize the time and effort taken to pick and package the products.
Additionally, companies can leverage warehouse management system (WMS) in SAP Business One for various benefits such as:
- Ensuring on-time order fulfilment for customer satisfaction.
- Extracting real-time data insights for improved decision-making.
- Building a scalable system designed for business growth.
- Streamlining various warehouse operations such as moving, picking, delivering, and packaging different products.
Next, let’s understand the importance of optimizing the warehouse layout.
Why is Warehouse Layout Optimization Important?
Layout optimization in warehouses is not simply important for using the storage space more efficiently. An optimized layout has a direct impact on workforce productivity and work efficiency. For instance, a well-designed layout can streamline the flow of goods across the facility and reduce wastage – particularly in the case of perishable goods.
With an optimized warehouse layout, companies can streamline their operations – from the initial stage of receiving inventory to the final stage of dispatching the goods. Effectively, this allows companies to cope with increased demands and maintain their delivery schedules.
How can SAP B1 ERP help in optimizing the warehouse layout? Let’s discuss next.
How does SAP B1 Help in Warehouse Layout Optimization?
As an ERP solution, SAP B1 can help in effective bin management across multiple warehouses. For individual bins, you can assign various attributes such as:
- Product size
- Hazardous (or not)
- Frozen (or not)
Using these unique attributes, warehouse managers can assign unique bin codes automatically, which makes it easier to track their location in the warehouse.
Additionally, SAP Business One can help optimize the warehouse layout based on:
- Overall storage capacity of the warehouse.
- Product demands, thus providing the best location for fast-moving goods.
- Ease of accessibility to storage shelves, thus making it easier for operators to pick and package products.
Next, let’s discuss some crucial steps to optimize warehouse layout using SAP Business One.
How to Create an Optimum Warehouse Layout in SAP B1
The warehouse is at the core of any warehouse management tool. On its part, SAP B1 enables companies to create multiple warehouses – that can operate separately. Additionally, SAP B1 can define the warehouse’s physical subdivisions – including rows, aisles, boxes, containers, cartons, and bins.
Here are the steps to create a warehouse in SAP B1:
1. Define the Various Warehouse Units
The first step is defining the warehouse units based on the business needs. For example, a general warehouse and a warehouse for spare parts, production, and scrap are needed.
a. Define the available quantities for each warehouse depending on the disposition.
b. Assign a unique G/L account or identification number to each warehouse.
c. Organize the warehouse with a unique numerical code before each warehouse’s name.
2. Define the “default” Storage Bin
SAP Business One allows you to define a default storage bin for each warehouse. Warehouses can have more than one storage bin – with each bin allocated for a specific type of product. All received items go directly into the default bin by checking the “Force default bin” option.
3. Manage the Cost of Items for Each Warehouse
Physical warehouses differ according to operating expenses – or costs incurred due to special storage requirements. SAP Business One allows companies to calculate the item cost based on the location of the warehouse. To do this, select the “Manage item costs per warehouse” checkbox.
4. Streamline your Stock Transfer Activity
Stock transfer is an integral part of every optimized warehouse. With SAP Business One, companies can efficiently transfer their stocks between storage locations, thus ensuring inventory control.
In SAP B1, choose the business partner and contact person when performing the stock transfer. This helps the accurate documentation of the entire stock transfer process.
Conclusion
An optimized warehouse layout is crucial for small companies to access products quickly and keep their costs under control. As outlined in this blog, the SAP Business One solution is the best fit for the efficient management of warehouses for different products.
Among the leading SAP B1 partners in India, Praxis Info Solutions has been effective at solving the warehouse puzzle with SAP B1 for global customers. As an SAP implementation partner, Praxis can develop customized warehouse solutions based on your specific requirements. To get started, check out our SAP Business One price.
If you are looking for an expert partner with affordable SAP ERP pricing and expertise, Contact us today.