A technician spending ten minutes looking for a bearing costs more than the bearing. The cause is rarely laziness and almost always layout: no fixed place, no readable code, no label. This article covers how to build a location structure, when to use barcodes or QR codes and what belongs on an item label. See spare parts management for the overview of warehouse management as a whole.
Why location structure is the foundation
As long as parts have no fixed, named place, your warehouse depends on who happens to be working. Every other improvement — min/max, counting, reservations — stalls on it: you cannot reliably count what you cannot find, and a system quantity without a location doesn't help the technician.
A location structure is the agreement that every item has an address and that this address is in the system. That is all it is, and it is the cheapest improvement you can make.
Building a location code
A good code is built from levels that run from coarse to fine, so it can be read without explanation.
The common structure is warehouse, aisle, rack and bin. A code such as MAG01-A-03-2 then points to warehouse 1, aisle A, rack 3, bin 2. With tall racking you can add a level in between. Anyone who knows the first two parts is already within three metres of the part.
A few rules that pay for themselves:
- Fixed length per level. Use 03 instead of 3, so sorting by code also matches physical order.
- One separator. Pick a hyphen or a dot and use it everywhere.
- Walk the aisle as you walk it. Number racks in the direction people walk, not in the order they were once installed.
- No meaning in the code. Don't encode item type in the location; you'll have to recode as soon as the assortment changes.
- Leave room. Number in steps of five or ten if you expect to expand.
Fixed or floating locations
With fixed locations every item has its own place. That is clear, people learn their way around, and an empty bin tells you something has run out. It costs space, because every bin stays reserved.
With floating locations you put an item wherever there is room and the system records where it sits. That uses space far more efficiently, but it only works if everyone scans consistently. Put something down once without registering it and it is lost.
For most technical warehouses fixed is the sensible choice, possibly with a floating zone for bulk and large parts. Half-heartedly combining the two without scanning discipline is the worst of both worlds.
Barcode or QR code
Both are fine; they differ in what they can handle.
A barcode (usually Code 128) is narrow and fits well on a strip beneath a bin. It holds one value, such as an item or location number. It needs to be reasonably straight and clean to scan.
A QR code is square, holds more data and copes better with dirt and damage: it remains readable when part of it has worn away. It can also contain a web address, so a scan with a phone opens the right item screen directly.
In an industrial environment with oil, dust and vibration the QR code usually wins on readability. On narrow rack strips a barcode is more practical. Many warehouses therefore use both: QR on the item label, barcode on the location strip.
What belongs on an item label
A label is not a dossier. Four things are almost always enough:
- The item number, large and readable at arm's length
- The description, short enough to fit on one line
- The code (QR or barcode) for scanning
- The location, so a stray part can find its way back
What you leave off matters just as much. Prices don't belong there — they change and you don't want to relabel. Nor do supplier names, because suppliers change. Stock quantities least of all: those are wrong within a day.
Mind format and material. A label in a freezer or next to a furnace needs different adhesive than one in a dry warehouse. Test one roll before ordering a thousand.
If you can print labels straight from your maintenance system, the code is guaranteed to match what is in the system. We show how that works under label printing.
Scanning on the shop floor
Coding only pays off when scanning is easier than typing. The actions with the most to gain are issuing against a work order, receiving a delivery, and counting — exactly the moments where registration is normally skipped.
How to make those three moments mobile and get the shop floor on board is covered separately in mobile working in the warehouse.
Rolling it out without shutting everything down
You don't have to empty the warehouse. A workable order:
- Decide the coding scheme and write it down, including the rules above.
- Label the racks and bins. This is physical work, but simple, and it can be done in parts.
- Register the location per zone for the items sitting there. Combine this with a count and you do two things at once.
- Label the items themselves, starting with what is picked most often.
- Switch issuing and receiving over to scanning.
Do it zone by zone. A half-converted warehouse works fine as long as it is clear which zone has already been done.
Frequently asked questions
How detailed should a location code be?
Detailed enough that someone who doesn't know the warehouse finds the part without searching. Down to bin level is enough for most warehouses; down to tote level only with large quantities of small items.
Does every item need its own label?
Every item you issue, count or reserve does. Bulk material handled by the metre or kilo is labelled at the location rather than on the piece.
What about parts stored in several places?
Register both locations with their own quantity, and designate one as the place issuing happens. Two locations without a clear issuing point guarantees count discrepancies.
Can I do this without a system?
Assigning locations and labelling can be done with a spreadsheet, and that alone is a big improvement. What you don't get without a system is the link to work orders, reservations and counts — and that is exactly where the return sits.