---
title: "Solving These 8 Warehouse Management Problems Can Save a Distributor a Car in One Year!"
description: "According to statistics, a distributor with annual sales of around 30 million yuan can waste enough money in the warehouse to buy a car in just one year, highlighting the significant losses caused by poor warehouse management. After investigation, eight common warehouse management problems were identified, and this article provides practical solutions for each."
author: "New Distribution"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2016-07-01"
language: "en"
canonical: "https://xinjignxiao.com/en/articles/solving-these-8-warehouse-management-problems-can-save-a-distributor-a-c-cfaf89ef/"
markdown: "https://xinjignxiao.com/en/articles/solving-these-8-warehouse-management-problems-can-save-a-distributor-a-c-cfaf89ef.md"
original_source: "https://mp.weixin.qq.com/s/K7emYMTh7wjLgyroqU6Vug"
translation: "https://xinjignxiao.com/zh/articles/%E5%BA%93%E6%88%BF%E7%AE%A1%E7%90%86%E8%A7%A3%E5%86%B3%E8%BF%998%E4%B8%AA%E9%97%AE%E9%A2%98-%E7%BB%8F%E9%94%80%E5%95%86%E4%B8%80%E5%B9%B4%E7%9C%81%E8%BE%86%E5%B0%8F%E8%BD%BF%E8%BD%A6-cfaf89ef.md"
attribution: "New Distribution — https://xinjignxiao.com/en/articles/solving-these-8-warehouse-management-problems-can-save-a-distributor-a-c-cfaf89ef/"
usage_policy: "https://xinjignxiao.com/ai-policy.txt"
---

# Solving These 8 Warehouse Management Problems Can Save a Distributor a Car in One Year!

> According to statistics, a distributor with annual sales of around 30 million yuan can waste enough money in the warehouse to buy a car in just one year, highlighting the significant losses caused by poor warehouse management. After investigation, eight common warehouse management problems were identified, and this article provides practical solutions for each.

According to statistics, a distributor with annual sales of around 30 million yuan can waste enough money in the warehouse to buy a car in just one year, highlighting the significant losses caused by poor warehouse management. After investigation, eight common warehouse management problems were identified, and this article provides practical solutions for each.

1. Unreasonable Warehouse Selection and Layout Design

**Specific Problems:**
During our investigation, we found that many distributors think, "As long as the warehouse can store goods and ensure safety, it's enough." They haven't considered what kind of warehouse is more suitable. Most distributors rent old factories or warehouses, and few are willing to rent professional warehouses. According to statistics, the cost of goods damage in such old factories or warehouses is actually much higher than the extra cost of building or renting a professional warehouse. Additionally, overall, there are many problems in the layout design of distributors' warehouses, which greatly affect the warehouse's functionality and increase costs.

**Practical Countermeasures: Specific Warehouse Area Planning**
The warehouse is the foundation of a distributor's operations. Choosing a professional warehouse can reduce many worries. If funds are tight in the early stages, renting is an option. However, warehouse management must be in place, and gradually, until you own a professional warehouse, you can rest assured. Solve the layout problem based on specific conditions.

**Plan the warehouse area according to the floor plan, reasonably arrange product stacks and handling aisles, and determine their positions based on brand and product division. The basic principle is that fast-moving products are closer to the shipping door, and bulky products are near the main aisle.** Generally, **reserve a large open space near the warehouse door** for personnel entry and exit, convenient loading and unloading, and temporary storage for special goods that need quick loading and unloading. Also, set aside a space for manufacturers to store promotional materials.

2. Cluttered Warehouse Functions

**Specific Problems:**
Using the warehouse as a garage or even employee dormitory is a common problem in warehouse management. Cluttered functions dilute the warehouse's intended storage function. A messy warehouse can lead to a series of serious consequences.

**Practical Countermeasures: Set Up Separate Functional Rooms**
To maximize the warehouse's professional function and save costs, it's not advisable to use the warehouse as a garage or dormitory. It is recommended that distributors simplify the warehouse's functions and minimize other items occupying warehouse space. If conditions allow, set up a separate office and garage next to the warehouse.

3. Unclear Responsibilities of Management Personnel

**Specific Problems:**
Warehouse managers have a tough job. Some warehouse keepers have nothing to do all day, but when needed to provide warehouse information, they know nothing. Unclear responsibilities and poor management can cause significant trouble for distributors' decision-making.

**Practical Countermeasures: Phased Management, Step-by-Step**
**Distributors must clarify the responsibilities of warehouse management personnel. Generally, the responsibilities include:**

**Product Inbound:** When the production workshop passes quality inspection, they issue a three-copy inbound order and hand it to the warehouse keeper. The keeper checks the received finished goods against the order, signs all three copies, keeps two copies (finance and warehouse copies), and records in the finished goods ledger.

**In-Warehouse Management:** The warehouse keeper is responsible for the quantity and quality of finished goods in storage, ensuring no loss or deterioration of raw materials. Any abnormalities should be reported to the supervisor promptly.

**Outbound Management:** Salespeople present a delivery notice (or invoice pickup slip) stamped by the finance department to pick up goods. The warehouse keeper receives the notice, ships the goods accordingly, and issues a three-copy outbound order. The picker must sign all three copies. The keeper hands the goods and two copies of the outbound order to the picker and records in the finished goods ledger.

**Document Transfer:** The inbound order is promptly transferred to the finance department by the warehouse keeper. The outbound order (customer signature copy) is promptly transferred to the finance department by the picker. All documents must be transferred to the finance department by the end of each month.

**Reports:** The warehouse keeper summarizes the inbound and outbound orders at the end of each month, compiles inbound and outbound summary tables, and transfers them to the company statistician and finance department.

**Reconciliation:** At the end of each month, the warehouse keeper should reconcile accounts with the finance department and investigate any discrepancies promptly.

4. Inadequate Preventive Measures

**Specific Problems:**
Every distributor thinks about warehouse safety to some extent, but they often fail to thoroughly eliminate safety hazards. Inadequate safety measures can cause immeasurable losses.

**Practical Countermeasures: Safety Starts with Details**
Safety is a concern for everyone, especially in warehouse management. Basic measures like theft prevention, fire prevention, rodent control, and moisture prevention are essential. Additionally, pay attention to the following:

Materials, tools, and equipment parts should be neatly and stably stacked at appropriate heights. Precision tools and measuring instruments should be placed properly. When handling sharp, burred, or oiled tools and parts, wear gloves. Goods should be placed securely and not protrude from shelves. Tools and parts should not be placed near electrical switches or on wires. Do not walk on smooth or oiled parts. Ladders and stools should be free of oil stains and placed firmly.

When moving parts or tools at night, ensure adequate lighting and clear paths. Consider the weight and physical strength when lifting to prevent accidents. When two people carry an object, coordinate and move in sync. When transporting parts by electric vehicle, place them stably and securely. Heated parts must be cooled before counting, transporting, and storing. If hot objects must be transported, use appropriate containers and mark them with "Hot" signs to prevent burns. The warehouse should be well-ventilated. Goods should be stacked at least 50 cm from the roof, walls, and lights, and at least 20 cm from pillars or between stacks. When using lifting machinery for indoor handling, follow the corresponding safety operating procedures and cooperate closely with crane operators, riggers, and crane drivers.

5. Internal Theft

**Specific Problems:**
Many distributors don't notice warehouse losses unless there is a clear shortage of goods, prompting a search that often yields nothing. Losses or theft are ultimately due to human factors, specifically warehouse personnel. Warehouse personnel generally fall into three categories:

**First, warehouse managers; second, warehouse loaders; third, delivery truck drivers and delivery personnel who frequently enter the warehouse.** Warehouse managers are often the boss's confidants, so the problem mainly lies with the loaders and delivery personnel.

**Practical Countermeasures: Use Both Positive and Negative Measures**
**Upgrade Monitoring:** The reason for rough handling by loaders is that the boss can't supervise them all the time. Therefore, upgrade supervision. Consider installing cameras or hard disk recorders. Record daily and review periodically. Employees will feel the boss is always watching, which can prevent rough handling.

**Discourage Theft:** In a messy warehouse, it's easy to take something without being noticed. Sometimes employees deliberately hide items, and if the boss doesn't notice, they may do it again. A clean, organized warehouse naturally gives employees the feeling that there's no place to hide, discouraging theft.

**Psychological Deterrence:** Employees who steal may think the worst consequence is resignation, which they can handle. The boss should make the consequence unbearable, such as immediate dismissal and handing over to the police for legal action. This deterrent effect will make employees think twice.

**Frequent Surprise Audits:** Many distributors don't check the warehouse for a year, making employees think the boss doesn't care, giving them opportunities. The boss's energy is limited, so they can't check every day. However, surprise audits can be effective. When problems are found, take them seriously to create a psychological deterrent.

**Positive Encouragement and Guidance:** The real solution lies with employees, not the boss. If the boss has to guard against employees like thieves, business will suffer. Encourage employees to suggest improvements for theft and loss prevention and reward them. This will motivate them.

6. Unreasonable Product Placement

**Specific Problems:**
Food products are often loose and fragmented, with low unit prices and high quantities. Therefore, in food distributors' warehouses, products are often placed unreasonably and untidily. These issues are the root cause of many warehouse problems. A messy warehouse can facilitate theft, reduce actual inventory, and increase product accumulation and loss. Even seemingly minor issues can lead to major operational mistakes.

**Practical Countermeasures: Adhere to Daily Warehouse Reports**
The warehouse serves the front line. If sales staff can't get inventory information in time, it can lead to stockouts or overstock. We recommend implementing a "daily warehouse report system," requiring warehouse keepers to submit daily reports before leaving work. This way, both the boss and warehouse managers can know inventory status in real time.

**Adhere to the "First-In, First-Out" Principle.** Stack products at fixed points and quantities. Each brand and category should have a fixed stacking location. Determine the quantity per stack based on the packaging nature to avoid random filling.

**Stack according to sales:** Based on brand traffic and speed, reasonably determine the number and space of stacks.

**Add clear labels to each stack,** indicating product name, specification, and production date. Try to ensure each stack has only one batch number.

**When stacking, maintain appropriate spacing:** The distance between stacks should not hinder loading and unloading, nor waste space. Place a bottom board under each stack to avoid direct contact with the ground.

7. Serious Inventory Problems

**Specific Problems:**
Warehouse space is limited. When overstocked goods take up space, the warehouse area becomes smaller, making organization difficult. Overstocking is a headache for every distributor, increasing financial pressure and cost losses.

**Practical Countermeasures: Remember the "1.5 Times" Standard**
Reducing inventory means increasing inventory turnover, thereby improving cash flow, which is crucial for the company's financial health. When market conditions change, the warehouse inventory strategy should respond immediately.

**First,** conduct a stocktake to determine actual inventory.

**Second,** adjust safety stock levels based on actual inventory and demand, and increase the frequency of receiving and shipping.

**Third,** adjust purchase quantities accordingly. Analyze market orders and forecasts weekly, and adjust inventory and purchase quantities based on the analysis. Keep inventory at a level that matches market demand to reduce procurement costs and speed up capital turnover.

It's important to note that actual inventory is not the quantity in the computer system but the actual varieties and quantities stored in the warehouse. **Minimum safety stock standard: Determine safety stock by brand and product. Generally, safety stock should be 1.5 times current sales.**

8. Improper Handling of Damaged Goods

**Specific Problems:**
Some distributors call damaged goods "rotten goods." Their occurrence is almost inevitable. When a distributor takes on a new product, they test it, and if it doesn't sell, it becomes slow-moving. Many opened boxes can't be stacked or stored, leading to accumulation over time. Damaged goods in the warehouse are unavoidable. These "rotten goods" cause many inconveniences and, if not handled properly, can lead to huge losses.

**Practical Countermeasures: Separate and Reuse Damaged Goods**
Be careful not to mix damaged goods with normal products. Use different methods for different types of damage:

- Products with intact quality but damaged packaging can be sold in bulk.
- Products with quality issues should be destroyed after manufacturer approval.
- Products with damaged outer packaging should be repackaged promptly for resale to avoid accumulation.
- Products with damaged inner packaging should be sold at a discount or consumed through free tasting or employee benefits.
- Overstocked products should be sold on credit, at a discount, or used as promotional gifts. It's best to establish a daily report system for product damage to stay informed.

**In the entire supply chain management of distributors, warehouse management is a crucial link. Especially today, squeezed by both large retailers and manufacturers, profit margins are thin, and making money is hard. Therefore, good warehouse management plays a significant role in cost control. Saving warehouse costs is adding to your profits.**

Scientific warehouse management is a skill. In this regard, manufacturers have more advanced experience and methods. Distributors can arrange for their warehouse managers to learn from manufacturers and peers to continuously improve their warehouse management level.

Source: Food Business (ID: tyjzksp)

**In response to the requests of many distributor friends, the third B-end e-commerce inspection class of this platform will visit Wanshang Yizhan, Yunbao Shangmeng, and Weijie Chengpei from July 9-12. Distributor friends interested in transformation can join us for on-site inspections:**

**Organization Format**
1. Company visits
2. Actual market case visits
3. On-site explanations
4. One-on-one communication

Participating distributors only need to pay a registration fee of 200 yuan. Time: July 9-12, 2016. Location: Changsha, Xiamen.

**Interested distributors can register by scanning the QR code below.**

**When adding friends, please reply "Third Registration".**

**Previous Inspection Cases:**

**Yishang Logistics Model Inspection** (Second B-end E-commerce Inspection Group)

**Caiba Model Inspection**

**Jinhuobao Model Inspection**

**Beiquan Model On-site Inspection**

**Piduoduo Model On-site Inspection**

-END-

The best FMCG distributor learning platform in China
Dedicated to providing professional, practical, and actionable tutorials for companies and distributors
Committed to helping Chinese FMCG distributors grow rapidly

**The most professional and practical knowledge base in the FMCG industry**

Reply with the red number below to get the corresponding content
Reply with number 1 to view the complete knowledge base

| **001** Excellent Articles | **002** Distributor Market Operations | **003** Terminal Visit Management | **004** Sales Supervisor Skills | **005** Sales Improvement Techniques | **006** Channel Expansion | **007** Managing Distributors | **008** Distributor Development | **009** Distributor Internal Operations Management | **010** Team Management | **011** Efficient Distribution Techniques | **012** Sales Manager's Skills | **013** KA Operation Methods and Strategies | **014** First Lesson for New Salespeople | **015** Internet, Brands | **016** Distributor B2B Transformation |

[Long press QR code to follow]


---

## Copyright and AI use

This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL.

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