Warehouse management Essay Example | Topics and Well Written Essays - 2000 words

Warehouse management - Essay Example It has become outdated when a company could take an order and quote to deliver after a month or two but today delivery is either the same day or in some cases the next day. This happens to keep your existing customer, which is far cheaper than finding a new one hence satisfying a current customer becomes paramount. Reichheld and Teal (2001) in a well-established research found , 5 percent customer retention can increase many companies profits by 25 to 95 percent, and cost of 6 to 7 times more for gaining a new customer than keeping an existing one. To ensure organizations maintain high performance in their operations that contribute to customer retention and satisfaction the idea of a warehouse has helped them to increase their accuracy, timeliness, customer is provided with the right product in the right condition and at the right time. This paper addresses the measures that enhance the performance of a warehouse. Performance and productivity of the warehouse is measured to ensure customer expectations and continuous improvement of the warehouse and avoid incurring additional costs and loss of customers. The suitability of any of the measures is governed by customer expectation, although they need to align to the company’s resources. Rushton, Croucher and Baker (2010), asserted that the method used should address both the cost of service provision and the level of customer service. Here, the areas measured within the warehouse are cost, flexibility, reliability, and asset utilization. There are a number of measures used nowadays in warehouses, which are based on productivity, cost performance measures, and those related space, labor, and equipment utilization. Most warehouse managers experience a big problem of inadequate space with many warehouses operating with about 20 percent of their available space at any time. Warehouses with high space utilizations result in high cost on employees for their