Learn About Ecommerce Operations

Setting up your e-commerce fulfillment warehouse: Getting started with some basics.

Your goal, like any e-commerce business, is to grow your online sales and increase the profitability of every sale made. The foundation of this begins with you having complete control of your inventory and fulfillment process.

The Language of Fulfillment

No matter if you’re experienced in fulfillment operations, or just starting out, knowing the basic references used can be extremely helpful when planning and operating your operations. Here are some basic references.

Read: ShipHero provides you with one single solution for managing your entire inventory and fulfillment operations. Learn more with the getting started guide.

Staging Area Terms

  • Receiving station: Where new products are checked in before being stocked on the shelves. If you don’t have a dedicated returns station, this is also where returns are checked in.
  • Packing station: Where the customer’s order items are packed in a shipping box or poly-bag, and the shipping label is applied.
  • Staging station: This is where packed items are put on skids or carts, to allow easy transfer to the outbound shipping station.

Tip. Plan on using about 20 per cent of your square footage for the staging area and dividing the other 80 per cent between shipping, receiving and product storage.

Planning out your warehouse

Start by taking into account the structural support poles and any other obstructions present in the space you are planning. Design your layout to accommodate these support structures so that your staff won’t lose time walking around them multiple times each day when processing orders or managing inventory.

Learn: Understanding Common Inventory Terms & References

In and out
Study the space where products come in and go out. If you have a loading dock then that will simplify where items come in. If you don’t, create a plan that is optimized for products will come in and out. Create separate sections for inbound and outbound products to avoid any chance of confusion. The simplest way to do this is to put a sign on a support pole or the wall. Using floor tape to indicate inbound and outbound sections is also another typical approach.

Tip. The doors are where products come in and go out, and that’s also where theft happens. If an entrance is often left open, don’t put anything that can be stolen with 10 feet of it. It also helps to orient your shipping and receiving stations so that people working there can see the entrances.

The staging area
Leave approximately 20 per cent of your total warehouse space as the staging area. It should be adjacent to the shipping station. The staging area contains your inbound and outbound sections, along with garbage (going out) and packing supplies (coming in). On busy days, you will be glad to have that space.

Which way should my shelves go?

Once your shelves go up and your warehouse is running, it will be tough to find time to change them. So you want them to provide the best possible combo of storage and access from the start.

Keep your shelving running in one direction – don’t put shelving at one end that runs the other way. If shelving goes in two directions, you end up with less usable space.

Orient the aisles so that you can see down the aisles from the packing stations. The ability to monitor pickers is more important than small improvements in walk times.

If you have a choice, the aisles should go down the longer dimension, creating fewer, longer rows. When aisles are aligned this way, you can fit in more shelving.

Learn: ShipHero Guide to Static & Dynamic Slotting

Pallet-sized and pickable shelving tips

Most e-commerce warehouses have both pallet-sized storage and pickable shelving. Pallet-sized racking is meant for bulk storage, while pickable shelves are sized for human arms to select one item at a time to fulfill an online shopper’s order.

Pallet racks
Pallet-sized shelving is used for:

  • Bulk stock
  • Overstock
  • Packing supplies
  • Getting items out of the way quickly when shipments arrive at inconvenient times.

Your aisles should be wide enough to handle a pallet jack (AKA a pallet truck, pump truck or jigger). You’ll need room to pull your pallet jack back all the way once its load is released. This will depend on your model, but figure that the jack and the human pulling it will need a minimum of 125 centimeters.

If you have a forklift, check the forklift’s manual for its aisle width radius requirements. Expect to need an aisle width of 185 cm to 400 cm if you need to accommodate a forklift.

Fire safety means that you will need to leave a safe amount of flue space between pallet racks. If you ever have the bad luck to experience a warehouse fire, flue spaces slow down the horizontal spread of fire while allowing water from sprinklers to reach the bottom of the fire. Learn more about why flue spacing is so important, and the right measurements for your warehouse here.

Pickable shelves
Pallet racks, while great for bulk storage, are a poor choice for small item picking. For picking, use 183 cm high shelving and fit six to nine shelves vertically up each picking unit. Space the shelving units between 85 cm and 105 cm apart. You will be able to get a picking cart (but not a pallet jack or forklift) down the picking aisle.

Learn: Optimizing Your Batch Picking

Ideally, these shelves are set up so that pickers can reach every product without having to climb or over-extend (you can use rolling stairs to provide access to higher shelves, but this costs time and space):

  • Use narrow shelves, typically 30 cm to 50 cm deep and put them back to back.
  • Alternatively, use deeper shelves and put in dividers to separate the 2 sides.
  • Use dividers or bins to keep items separate
  • Don’t be tempted to use the floor as your bottom shelf, as you’ll want to keep items off the floor to prevent damage from minor flooding.

It may take a little more planning upfront, but setting up your warehouse the right way will help your orders reach customers faster, reduce returns due to picking/packing errors, help prevent workplace injuries and reduce theft.


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