How To Reduce Shrinkage In A Warehouse

Discovering how to reduce shrinkage in a warehouse heightens the potential for profitability. In simplest terms, shrinkage is little more than the loss of goods without remuneration. Losses may be due to theft, breakage, negligent handling or simply losing track of their whereabouts.

To get started learning how to reduce shrinkage in a warehouse, it is a good idea to gather some basic materials:

  • Inventory of goods
  • Shipping and receipt manifests
  • Shrinkage accounting

Once the warehouse manager or accountant has a thorough understanding of the approximate amount of goods that are lost, it is time to come up with a step-by-step process that shows how to reduce shrinkage in a warehouse.

  1. Verify the accuracy of shipping manifests. Work with the shipper to ensure that all items noted on the shipping manifest actually make it onto the trucks.
  2. Computerize check-in of goods. Barcode readers and similar technology assists warehouse personnel when unloading trucks and checking goods into the warehouse. This eliminates human error when tracking items manually on paper.
  3. Set up real-time tracking of goods that leave the warehouse. This is especially crucial if orders are compiled from various shipments received earlier.

It is interesting to note that when first introducing a company to methods that outline how to reduce shrinkage in a warehouse, there may actually be some resistance. Tags or technology may be too expensive or the warehouse staff may be unwilling to submit to the additional training and a reworking of procedures. Overcome these objections by showing that learning how to reduce shrinkage in a warehouse actually greatly enhances the company’s overall profitability and, therefore, the individual workers’ job security.

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