---
title: "Distributors: Don't Let Poor Warehouse Management Hold You Back!"
description: "Warehouse management in small and medium-sized private companies is often outdated, with messy environments, high product damage, and frequent inventory errors. The root cause often lies with the boss's overly simplistic requirements, focusing only on quantity. To improve, additional assessment points such as product value, dead stock ratio, and shipping accuracy should be introduced."
author: "潘文富"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2017-08-05"
language: "en"
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# Distributors: Don't Let Poor Warehouse Management Hold You Back!

> Warehouse management in small and medium-sized private companies is often outdated, with messy environments, high product damage, and frequent inventory errors. The root cause often lies with the boss's overly simplistic requirements, focusing only on quantity. To improve, additional assessment points such as product value, dead stock ratio, and shipping accuracy should be introduced.

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Warehouse management in small and medium-sized private companies is generally backward: the site is dirty and messy, product damage is severe, storage location design is unreasonable, time management of goods is not implemented properly, dead stock and long-term slow-moving goods are everywhere, inventory discrepancies always occur, and shipping errors happen every few days.
The root of all problems in a company often lies with the boss. The instructions and standards set by the boss are the guide for employees' work. **For warehouse management, most bosses' requirements are too simple, mainly focusing on quantity.** They just want to ensure the inventory numbers are correct, no shortages, no losses. But even with such simple requirements, some warehouses still cannot guarantee accurate numbers. During inventory counts, there are always discrepancies, sometimes even every count is unclear, and then a lot of objective reasons are given (high daily inbound and outbound volume, few staff, temporary storage and loans, insufficient storage space, etc.). The boss softens and says, "Forget it, let it be."
**Of course, besides the boss's management orientation, warehouse issues also involve management techniques and warehouse personnel.** Management techniques mainly refer to methods, processes, and tools, which are not covered here. The problem with warehouse personnel is whether they are willing to do the work and whether they know how to do it. "Knowing how" can be addressed through training, tools, and visiting other warehouses. "Willingness" is related to personal interests, i.e., income and assessment.
As mentioned earlier, the boss's assessment of the warehouse mainly focuses on basic inventory number management, ensuring no shortages or losses, and matching accounts with goods. There is a lack of more comprehensive and integrated assessment indicators, such as product value, transparency, and emergency plans. Since the boss does not explicitly propose these requirements, employees will not proactively think about these aspects. Without direct personal interest, they will not deliberately require themselves to execute.
So, in warehouse management, what additional assessment points should be added for warehouse staff on top of the traditional numerical assessment? Here are some for reference:
1. **Product Value Assessment**
From the moment goods enter the warehouse, their value decreases day by day, such as extended time, packaging wear, contamination, etc. Although the numbers may be correct, the value of the goods has already started to decline. There is rarely targeted assessment on this, but it is very necessary. Consider using storage time and the condition of the goods as indicators for product value assessment, guiding employees to not only ensure accurate numbers but also ensure that the value of goods does not drop too quickly.
2. **Dead Stock Ratio Assessment**
Dead stock refers to goods that have not sold for two consecutive months during the normal sales season, or goods that have no sales value but cannot be returned to the factory, or directly scrapped items. Dead stock not only occupies storage space and increases warehouse management workload but also ties up capital. Although the root cause of dead stock is not the warehouse department, once the warehouse department discovers dead stock, it must provide handling suggestions, such as returning to the factory, discounting, or even treating as garbage, and submit to the boss for decision. Based on the actual storage situation, a dead stock ratio should be defined, and the quantity of dead stock should be controlled within this ratio.
3. **Storage Location and Product Status Display Assessment**
This assessment involves transparently labeling the distribution of storage locations and the status of various goods, so that everyone entering the warehouse can clearly understand. For example, a floor plan of storage locations, accurate product names and barcodes, whether goods are new and not to be shipped, whether they are temporary storage for a customer, whether they contain gifts, whether they are non-original packaging, whether they are priority loading/unloading goods, and even the production month and standard stacking structure. All this information should be displayed through labels, making it clear at a glance. Even if the old employee is absent, new loading workers can immediately understand the storage distribution and related product status through these clear labels.
4. **Inventory Count Time Assessment**
The time required for each inventory count directly tests the level of on-site warehouse management. Generally, for a single warehouse with an area of less than 1,000 square meters and fewer than 300 SKUs, the full inventory count should be completed within two hours. If it exceeds six hours, there must be problems with on-site management. The speed of inventory count directly reflects the level of on-site management. Consider using this inventory time as an assessment standard, continuously requiring warehouse staff to strengthen on-site management.
5. **New Employee Onboarding Time Assessment**
This refers to how long it takes for new warehouse loading workers to become familiar with all warehouse work processes. The longer it takes, the worse the warehouse management. According to the average warehouse standard of 1,000 square meters and fewer than 300 SKUs, the onboarding time should not exceed one week, and excellent warehouses can achieve full familiarity in three days. So, how many days does it take for new employees in your warehouse to get up to speed?
6. **Shipping Accuracy Rate Assessment**
This is the accuracy rate of outbound shipments. Over-shipping, under-shipping, and wrong shipping all fall into the category of shipping errors. Shipping errors directly lead to conflicts between delivery personnel and the warehouse department, affect the image in front of customers, result in fines from strong terminals, and increase costs due to exchange and replenishment. Generally, the shipping accuracy rate needs to be above 98%. Each percentage point decrease means an additional loss of over 10,000 yuan per year.
The above assessment points can be selectively added by bosses based on the current warehouse situation. Each assessment point corresponds to rewards or fines. There must be a connection between work requirements and employees' personal interests; otherwise, no matter how much the boss emphasizes importance, employees will continue to do as they please. **Of course, adding these assessment points is also to encourage warehouse staff to gradually move warehouse management towards transparency, standardization, and value creation.**
Born into a private business owner family, I have managed a family distributor company for many years, and during that time, I also served as a business manager and trainer in several production enterprises. My research focuses on the internal management of small and medium-sized private enterprises, with main topics including personnel management, cost control, management backend construction, and the integration of retired military personnel into private enterprises. I have continuously broken down over 400 topics related to internal management of private enterprises and keep updating my material collection and solutions.


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Contact: zhaobo258@gmail.com · +86 158 5481 7671