Storage structures: cost or investment?

    Storage units are part of the business routine of several branches of activity. Some prefer to lease these spaces. Others find it better to build their own warehouses. Fact is that these structures, when well managed, help entrepreneurs to increase their profit margin.

    What separates COST from INVESTMENT in the Intralogistics segment is a very simple set of characteristics. Everything that is necessary, useful and functional, from a Flow Rack system to a self-supporting crane full of stacker cranes and robots, can be considered an investment. And the good ones! Therefore, before applying resources to these frameworks, try to answer the following questions:

1. Do I need a warehouse?
2. Will it be useful in daily operations?
3. How big is my stock?
4. Is the turnover of goods high?
5. What kind of product will I store?
6. What is the ideal size?
7. Will I need forklifts and conveyors to move loads?
8. What technology will I use to identify the products?
9. What is the best type of warehouse for my business?
10. What software do I need to run the operations?

    Note that the first five questions are the easiest to answer. The last five require research work. Companies specialized in this field, such as Águia Sistemas, a national leader in Intralogistics, can help you in such an analysis. But it is the first two questions that will define the difference between cost and investment. If you need the structure and it will be useful, you can be sure that the eventual expense of implantation is paid for with the daily operations.

    In addition to the initial investment, there are the costs of maintaining the building. Water, electricity, property tax, eventual repairs. As in the other departments of your company, it is also necessary to think about the workforce, usually composed of assistants, lecturers, assistants, analysts, supervisors, coordinators and managers. The number of employees will depend on the technology used and the size of the operation. You must also account for the acquisition of pallets, the depreciation of machinery and equipment, storage services, not forgetting the packaging, and all IT tools. used to manage the warehouse. Finally, it is necessary to take into account the opportunity cost, that is, the capital immobilized in the investment. This calculation is usually done by multiplying the asset value by the company’s opportunity rate, which varies from 10% to 20% per year.

    Will all these variables affect the final price? Yes of course. Something perfectly predictable in any well-designed cost spreadsheet. But the good news is that this impact can be reduced with good warehouse management.

    The tecnovia.com.br website gives some guidelines to improve the performance of your storage units:

1. Inventory reduction – Avoiding over-stocking prevents waste and ruptures, which has a direct impact on the company’s financial operations. More than just reducing the number of goods in stock, it is necessary to seek alignment between the purchasing and sales areas, creating a culture of internal integration between all components of the supply chain.
2. Elaboration of a good planning – The elaboration of a correct planning reduces operational costs, increases the profitability and improves the level of the service, generating a great competitive advantage.
3. Support in a logistics operator – For many managers, the greatest difficulty is still in maintaining a well-organized stock. Therefore, having an outsourced logistics operator can provide the company with improvements in the level of service provided, ensuring a competitive leap in the market.
4. Simple project application – Describing and documenting operational processes in manuals and booklets (preferably virtual) is another process that increases productivity. Using the ABC curve for stock organization is also a great alternative to reduce wasted time and resources.
5. Inventory optimization – This is a strategic factor. Inventory management is an organizational task and, as it is very dynamic, it requires continuous attention from the manager and its operators. Therefore, always take into account factors such as: the proper layout of your warehouse, the process of identifying and addressing your sectors within the stock, the study of the most suitable packaging for that environment, the effective control of the information of each item ( expiration date, product type, number of batches, etc.), among others.
6. Investment in infrastructure – It is up to any company to “look inside” its warehouses and always seek efficient solutions to improve its infrastructure, such as equipment, storage systems, management software, among others.
7. Process integration – The more integrated your logistics are, the lower your operating costs. This is a general rule of thumb and certainly involves the entire storage procedure. A classic example that proves this is the methodology called Cross Docking, it allows the maximum “downsizing” of the supply chain stages, enabling deliveries carried out almost directly after receiving the material by the company. That is, as soon as the product arrives at the docks, it is already directed to the expedition and goes to the customer.
8. Investments in technology – In times of logistics 4.0, it is impossible to become competitive without the use of technologies. The WMS, Warehouse Management System, works directly in the management of inventories, allowing companies to manage all the internal movement of their materials, even before they are dispatched for delivery. But there are other devices, such as RFID Identification, that is, the use of radiofrequency tags in the storage of products, which facilitate the entire management of goods. The greater the investment in technology, the more rational the operation becomes.

          In summary, it is worth investing in a warehouse or DC (Distribution Center)! Just have a good structure, good equipment and especially good employees. There are many possibilities for your business. Want to know which ones? Keep in touch with us. Águia Sistemas is the absolute leader in Intralogistics solutions!