Warehouse Putaway: How to Optimize Your Inventory


Connect With a Fulfillment Expert Today.

Get Started

Subscribe to our blog

Join tens of thousands of ecommerce brands to get more articles like this and our latest resources delivered to your inbox.

Imagine this scenario:

Goods from a supplier come into your warehouse but no staff member is assigned to put them away into storage bins. So it languishes in the staging area for a few days. Then, someone randomly picks it up and drops it in a bin without cross-checking if the stock matches the PO and invoice. No one makes note of the exact storage location of this SKU either. 

This is a recipe for inventory management disaster if there ever was one.

To avoid nightmares like the one outlined above and ensure greater efficiency and accuracy in inbound and outbound logistics, consider investing in optimizing warehouse putaway. By intelligently moving inventory to an optimal location in the warehouse, you enable lean warehouse management.

In order to satisfy the increased volume of ecommerce demands, all warehouse processes need to be optimized and streamlined. ShipBob enables retailers to be more tech-driven with modern warehousing solutions.

In this article, we’ll shed light on everything warehouse putaway – from the different putaway strategies, their benefits, and how a 3PL can help improve the warehouse inventory management.

What is warehouse putaway?

Putaway in warehouse is a crucial aspect of warehouse management, which involves several processes starting with warehouse receiving and ending with ensuring that inventory is stored in the right warehouse locations. But, it is much more than just moving the inventory from point A to point B.

With a strategic warehouse putaway system in place, it becomes so much more efficient and straightforward to store inventory without misplacing any SKUs. This process also improves warehouse tidiness and makes it easier for pickers to find the right SKU quickly. 

Types of warehouse putaway

It may seem like a simple process, but warehouse putaway (from dock to stock) needs to be well-thought-out as it is a crucial aspect of warehousing.

Depending on the type, volume, and variety of physical inventory and other unique features of your business, you could choose from these three different types of warehouse putaway:

Dynamic putaway

Do you have a homogenous product mix? Are they similar in size, weight, and other physical characteristics? Then, choose a dynamic putaway to make the stock retrieval and storage easy. It involves making decisions in real-time about where to store incoming inventory while prioritizing demand management.

As goods enter the warehouse, depending on their sales volumes, they must be stored in the most convenient locations for fast pickup. 

On the flip side, since the goods are stored in different locations every time, it is more difficult to keep track of them without a robust tech-powered ERP like warehouse management software.

Direct putaway

The moment goods reach your warehouse, with direct putaway the goal is to ready it for dispatch/transportation to its final location within the warehouse, without spending time in temporary storage locations. This reduces unnecessary movement and handling of the goods.

Here too, it is essential to have a real-time use of a warehouse management system to help identify the products which should be putaway and their destination.

Note: The logistical procedure of cross docking completely circumvents putaway and warehouse picking processes. Goods are received and immediately transferred to the outgoing trucks. 

Fixed-location putaway

This process is ideal for retailers who have many varieties of goods that need to be stocked in the warehouse, and want them to be retrieved easily. 

Each category of goods is assigned a specific warehouse space that is conducive to storing them.

For example, frozen food will always be stored in a temperature-controlled storage area. And heavier goods will be placed in the lower warehouse racks, while the lighter goods can be stored on the higher shelves. 

Benefits of warehouse putaway

When done right, warehouse putaway will help you improve different aspects of SKU management from inventory tracking to storage, and picking. On that note, let’s deep-dive into the different benefits of warehouse putaway. 

Reduces the chance of lost or misplaced items

If you have a stringent process in place to put away the restocked inventory it becomes easier to stay on top of where each SKU is located. Knowing the inventory position not only improves inventory accuracy but also helps you avoid instances of misplaced or pilferaged SKUs.

Since the putaway process encourages the warehouse workers to account for each SKU, you can also track the source of any inventory discrepancies

It can speed up the picking process

If your top-selling items are stocked in locations that are easy for the picker to access, it will speed up the picking process. It also helps to know exactly where each SKU is located. This, in turn, shortens the order cycle time and with faster deliveries, customer delight is guaranteed.

Effective use of storage space

Do you constantly struggle with storage availability? An organized putaway strategy will help you decide the best ways to use your warehouse setup to save space and reduce inventory carry costs. It also helps you maintain a clean and organized warehouse.

Efficient putaway and slotting also bolster warehouse safety and integrity of the stock by ensuring that goods get stored in appropriate locations.

Warehouse putaway best practices

If you don’t have a putaway process yet, it’s time to include it into your inventory strategy. Here are some best practices that will help you improve the overall efficiency and warehouse operations.

Create a timeline

Warehouses tend to be beehives of activity. The moment goods are replenished, they need to be speedily putaway to enable friction-free customer order fulfillment. 

Clear directions and timelines need to be shared with every employee on the putaway process so that there is no warehouse floor congestion, delayed shipments, or inefficient use of warehouse capacity.

Track all items

It is foolhardy to expect warehouse staff to manually track the location of each SKU in their brains. This is why you need an inventory scanner and digital warehousing technologies that support SKU tracking.

As and when inventory is received, barcode scanned and putaway, you will get real time inventory updates of the SKU count, condition and location. This makes it easy and quick to find and dispatch the right items, whenever an order is placed by customers. 

Reduce traveling time

Minimize the distance from the receiving dock to the final warehouse storage location. Doing so will optimize the put away process. So, every time new goods are received it will reach your storage quickly and this will mean that they are also ready for order picking immediately.

How can ShipBob help you improve your warehouse putaway process

ShipBob helps ecommerce retailers improve their putaway and other warehousing processes with tech-enabled solutions. 

Thanks to our warehouse and distribution services, it becomes really easy to track warehouse KPIs and fast-track the putaway process. This improves the inventory optimization capabilities of your business.

Our clients also get access to our network of fully-operational distribution centers, with manpower, forklifts, pallets, etc. 

This combination of technology, support, and a growing fulfillment distribution network helps retail companies scale. We also offer the option of in-house order fulfillment with the full-stack Merchant Plus, ShipBob’s very own warehouse management solution.

What is warehouse putaway?

In ecommerce warehousing, putaway is the process of transporting the goods and storing them efficiently once they are received.

What is warehouse replenishment?

Even before your warehouse stock runs out, you want to be prepared to reorder inventory. To know what quantities to mention in your PO to the supplier, you may use the Reorder quantity formula.

Inventory replenishment is more frequently performed by retailers whose turnover rate is high.

What is the difference between putaway and storage?

Putaway includes all the processes between warehouse receiving, transportation, and ensuring that inventory is stored in the right locations. Storage is only the last step in the putaway process.

What is a putaway plan?

A putaway plan helps you optimize warehouse space, resources and product quality. To know how much resources, and space will be required for the putaway, you need to take into account expected receiving and current backlog using an inventory storage system.

What are the advantages and disadvantages of warehouse putaway?

Warehouse putaway reduces the need for warehouse audit and improves stock availability. It also speeds up the picking process, reduces instances of stock discrepancies, and optimizes warehouse space. 

On the downside, putaway can be time and effort consuming if executed manually. This is why most growing retailers rely on smart warehousing technologies.

How does warehouse putaway help the warehouse manager?

Efficient putaway reduces the need for regular warehouse inspection. And it also improves the warehouse safety and fulfillment speeds.  

What are the steps in warehouse putaway?

During putaway, here are some of the most common steps followed by warehouse staff:

  • Accept the transfer order
  • Identify and conduct a quality check on the article
  • Transport the article to the relevant storage space 
  • Label and store it in the relevant rack

Written By:

Meredith is a Content Marketing Specialist at ShipBob, where she writes articles, eGuides, and other resources to help growing ecommerce businesses master their logistics and fulfillment.

Read all posts written by Meredith Flora