How to prepare your warehouse for a recession

November 16, 2022

Whether it's already here or still on the horizon, a recession is something business leaders in every industry are going to have to contend with. The supply chain is particularly vulnerable to dips and valleys in the economy, and every stage of the manufacturing and distribution process will require very particular plans and precautions. Warehouse organization executives, managers and supervisors should design strategies focused on circumventing disruptions or challenges in other areas of the supply chain to maintain their own robustness. Below are a few ways in which warehousing businesses can prepare for a recession:

Implement a greater degree of automation

Unfortunately, reducing your labor force is sometimes the only way to deal with economic turmoil. However, layoffs invariably result in reduced productivity and efficiency if not accounted for sufficiently. As Kardex explains, you can overcome this specific obstacle by ensuring you have enough automated processes in place to account for a diminished number of employees if minimizing your team sizes is a route you need to take. That said, you also need to make certain that you have enough qualified workers to oversee your chosen automated warehouse solutions.

Enhance your inventory management systems

Having an appropriate level of stock is all-important for staying afloat during a recession. As Dalmec notes, it's critical that you have just the right amount of inventory to meet your demand without overspending on merchandise you can't sell. If you don't have enough stock, you're going to miss out on sales. By contrast, if you have too much, you've wasted valuable capital and physical resources. To supervise your stock properly, you need to guarantee that your inventory management system is up to scratch. Use smart IMS systems powered by data analytics to keep track of your inventory accurately.

Optimize your physical warehouse storage

Floor space is crucial to the success of businesses in warehousing. With warehouse real estate prices continuing to skyrocket, it's essential that you focus on what you already have. Chances are, you can't afford to rent out or purchase additional buildings to accommodate increased order volumes, so it's vital to make the most of the square footage in your possession. You can do this by utilizing vertical storage (as opposed to just your horizontal) areas and scheduling your employees' shifts more effectively so that your workers themselves don't take up extra room.

Schedule your workforce properly
Operational efficiency is key to surviving a recession. Make sure you've planned your workers' shifts in a way that maximizes their productivity without wasting time and your team's energy. Many hands make light work, but too many chefs spoil the broth. By creating timetables that include just the right number of employees in appropriate positions and roles, you can reduce unnecessary additional labor. To do this, take your demand and order volume into account so that you have the right number of workers on the floor at any given time.