Tips for Reducing Warehouse Costs

A warehouse isn’t always easy to run, but if done properly, it can be a very lucrative endeavor. As costs stack up, your bottom line shrinks, and your business stagnates. Naturally, you want to maximize your business’s profits and ensure a fruitful future, so you should check out these major tips for reducing warehouse costs.

Secure Storage

Cargo theft costs warehouses in the USA up to thirty billion dollars every year. Naturally, you don’t want your warehouse to contribute to that statistic, so it’s important to keep a close eye on your cargo. Security cameras should cover every nook and cranny of the warehouse floor, and access should be strictly limited and monitored with traceable keycards and smart locks. People are much less likely to steal when they know that they’ll get caught, and filing insurance claims and police reports can be a huge hassle anyway. On top of preventing theft, you also want the cargo to be stored competently and securely enough to avoid damage, so your floor managers should regularly inspect the cargo to ensure that it’s all stored as safely as possible.


All of your equipment operators should be certified. If they’re not, then you shouldn’t let them use equipment without certification. In many jurisdictions, certain certifications are legally mandated, and insurers sometimes look into an employee’s credentials when a workplace accident occurs. Regulatory and insurance concerns aside, certified workers can perform their daily tasks much more safely and efficiently. Consider sending some of your more promising workers to get certified. It’s an investment, but certifying an existing employee is much cheaper than interviewing candidates and training new employees.

Smart Scheduling

Your operations will only run smoothly if you have the right number of workers for the task. With too many workers, you end up paying more in wages than necessary, and an unnecessarily overcrowded workplace can slow operations down to a snail’s pace. On the other hand, if you don’t have enough workers on board, then they will not be able to work efficiently either. Make sure that your managers adequately take upcoming shipments into account when forming a schedule. If a manager isn’t scheduling as efficiently as they could, it’s your job to talk to them and guide them towards better scheduling practices.

Use Your Space Wisely

Storage is your warehouse’s entire purpose. The more cargo you can fit, the more money you can make. When hiring, try to find a way to test candidates’ spatial reasoning. To ensure the most efficient use of space, it’s important to develop comprehensive storage guidelines and references for the containers and types of items that your employees are likely to encounter.

Minimize Power Consumption

Energy makes up a significant portion of your business’s expenditures. Electricity isn’t free, so you should focus on decreasing this cost as much as possible. Not every light needs to be on all the time. If you need to heat or cool a section of the warehouse, then make sure that it’s properly insulated, and instruct your employees to close relevant doors and windows. Also, equipment shouldn’t be running unless it’s in use, so your employees should know not to leave any forklifts or other equipment idling.

Effective Hiring Practices

Merit and reliability should be the two key factors when hiring new employees. If a candidate has a criminal background or a history of poor character, then do you really want to trust them around a bunch of valuable cargo? While not every candidate necessarily needs prior warehouse experience, it’s still important to hire employees who will show up to work on time, sober, and with the right attitude. Your business is only as strong as its weakest link, and even a single poor employee can cost a lot in the long run.

Smart Information Storage

Every shipment should be well documented, and all of your managers should have quick and easy access to all relevant workplace information. If you have subpar IT, then your business cannot operate efficiently. Every relevant manager should be extensively trained to understand whatever system you’re using, and you should always keep your databases up to date.

Workplace Safety

Insurance is expensive, and if your workers are constantly getting injured on the job, then your rates are going to go up. Aside from saving money, ensuring workplace safety is simply the right thing to do. You should comply with all OSHA standards, and all employees should be regularly refreshed on relevant workplace safety protocols.

Maintain Equipment

Depreciation is inevitable, and if you’re not taking proper care of your equipment, then your assets will depreciate very quickly. Replacing a forklift or other piece of equipment is an expensive endeavor, so you should strive to make every piece of equipment last as long as possible. By consistently maintaining a piece of equipment per the manufacturer’s guidelines, you can extend its life by months or even years.

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