Operating a warehouse for your business can provide several improvements to both the scalability and profitability of your organization. However, and as any warehouse manager will tell you, running a warehouse does not come without its own set of challenges.

While owning your own warehouse space can be beneficial, there are potential pitfalls that businesses can face if they don’t practice due diligence. This is especially the case when addressing workplace safety, operational expenditures, and supply chain efficiency.

Here are a few common problems businesses face when managing a warehouse and the important steps you take to avoid these pitfalls.

Safety and Liability Issues

Most warehouses are stocked with various pieces of heavy machinery and equipment that can be hazardous to personal health and safety if not used properly. If employees are not trained properly on how to use this equipment, or they are allowed to consume alcohol while working in the warehouse, this can cause serious liability issues for an organization if someone gets injured.

Businesses should instill the importance of workplace safety with all employees in order to avoid any costly safety or liability issues on work premises. This can include creating “no walk-through traffic” policies for employees who do not work in the warehouse, as well as ensuring all warehouse staff is wearing approved safety gear at all times.

Creating a safety committee and certifying certain employees in first-aid response is also a great way to enforce safety standards in and out of the warehouse. Safety committees are comprised of a few different employees from various departments whose goal it is to monitor and maintain safe working areas. They not only help to create and enforce new safety policies for the organization, but they can help reduce or eliminate business safety compliance issues before and after certified safety inspections.

Poor Supply Chain Management

Regardless of the size of your warehouse, it’s vital that you deploy methods to efficiently manage what comes in and out of its doors. As you begin to scale your business, poor supply chain management can quickly begin eating at your bottom line. Whether it’s suffering from poor forecasting accuracy or lack of adequate logistics coordination, businesses that don’t take to proper steps to organize their warehouse operations can quickly run into financial issues.

Investing in a quality enterprise resource planning (ERP) system is often the first step most businesses should take when operating a warehouse. ERP systems help to unify sales, accounting, logistics, and operational aspects of an organization significantly optimizing supply chain management. They also play a vital role in ensuring accurate inventory levels across physical and virtual warehouse spaces, while also serving as a hub for the effective management of vendor and supplier relationships.

Increased Operating Costs

Warehouses are often the source of the highest operating costs of a business — and rightly so. However, while most businesses understand the necessity of making larger investments in warehouse operations, many of them do not do a deep enough analysis of their spending to ensure they’re getting the best bang for their buck.

When considering the costs associated with shipping supplies, pallets, and damaged product replacements, it's important to ensure you‘re maximizing the value of your investments and reducing waste. Collecting used packaging materials from inbound shipments and reusing them for outbound shipments is a great way to both reduce your supply costs and your carbon footprint.

Switching from wooden to plastic pallets is another way to reduce your spending over time by switching to more durable and longer-lasting shipping and storage materials for your warehouse. Not only are plastic pallets lighter, reducing the weight and costs of shipments, but they also have a much longer lifespan than standard wooden pallets.

Damaging Carbon Footprint

Modern businesses that operate a warehouse are trying to become socially responsible and are doing their best to reduce their carbon footprint, whether through the miles they drive, the means by which they ship, or even how they record/document storage and waste. Greenhouse gas emissions have become a worldwide epidemic, and every business owner, especially those occupying large commercial buildings, should look for ways they can help minimize their wasted resources and contribution to local landfills.

One of the first steps you should take when managing a warehouse is creating an organized recycling system. Everything from used boxes, plastics, and paper should be sorted in their appropriate bins and scheduled for recycling. Another way to reduce waste is by switching from fluorescent to LED lighting. LED lights last 50 times longer and produce much less heat than fluorescent bulbs, letting you save on air conditioning and the cost of new lighting. These steps will significantly reduce wasted resources and help you lower your carbon footprint effectively.

Running a successful warehouse operation is not an impossible task. By following these steps closely, you’ll ensure you maintain a safe workplace while maximizing the productivity and efficiency of your operations department.