ROI up, damage down

Successful material handling really comes down to a simple premise: moving products from one point to another to customer specifications, on time and damage free. It’s a process with many moving parts, some controllable and others far beyond the control of a material handling operator.

One of the biggest elements that material handlers can actually control is supply chain damage. While many warehouse operators assume that damage costs are simply a part of doing business – not every dented box, scratched inventory item and lost product is avoidable – there are many steps that can be taken to greatly reduce this cost of doing business. Investing in proper storage and systems – from automation and containers to pallets and shrink wrapping – can ensure higher profitably and less material damage over time.

Proper packaging is important. Damage is not a one-to-one proposition either – studies have shown combing the direct and indirect expense of replacing or issuing a credit for the damaged product can be 17 times greater than the original cost to ship an item.

Damage can happen virtually anywhere in the process. Pat Pownall, director of sales for Orion Stretch Wrappers, says that many of his customers have a common pain point.

“The pain point that we see is the wait point at the end of the line, when they’re waiting to stretch wrap,” he says. “It’s often damage, or they want to energize thruput, but one of the biggest things we’ve seen is wanting to replace manual labor because it’s been so difficult to fill positions.”

Regardless of the fundamentals of why companies are looking to improve their stretch wrapping operations, it ultimately comes down to better materials protection.

“Returned goods are a measurable item,” says Pownall. “What we do is sell theory, and what we can says is that if you switch to 260degree stretch when wrapping to a pallet, you’re not going to be dealing with damaged goods.”

Pownall recommends a line audit to see where pain points may be occurring: product boxing, palletizing, labeling, wrapping, etc. It’s the last point that his company focuses on.

“Too many times, we will have companies come to us and say, ‘We do two top wraps, two bottom wraps, an overlap four inches above the load, and we do 60 loads an hour,’ and when we know that wrap pattern will not effectively hold the product weight on the pallet,” he says.

Pownall categorizes loads into A, B, and C. An A load is considered a “perfect” load in terms of packing and with the proper wrap, will arrive at its destination intact and without damage. A B load may contain a few items or cartons that change the normal pack pattern. And a C load? Think of a hardware store order for a few bags of top soil, some tools, maybe some plumbing pipes and a rake – all thrown on a single pallet.

“It’s really impossible to completely secure a load like that,” he says.

He says that an audit can uncover how effective an existing wrapping approach is, both from a damage standpoint and from a waste standpoint. “We can see if it’s the best pattern for your materials, if you’re using the correct amount of shrink wrap and if you possibly have the incorrect amount of pre-stretch, for example,” he says.

If any of these elements are off, it could expose your operation to product damage.

“Many people are also very concerned with the speed to get products out, and that is a necessary evil,” he says. “But fundamentally, it’s more about successfully getting product from Point A to Point B. It’s really difficult to say that you’ll always be able to do that 100 percent of the time, but with the proper steps you can really reduce the amount of damage that occurs.”

Proactive measures are another way to reduce damage to materials as they move through the warehouse. A comprehensive approach is important; not all damage is immediately obvious, especially for packaged or materials that are sealed in cartons or cardboard.

To maximize warehouse space, many are designed to maximize vertical storage, and regardless of how efficient it is, in a faceoff between inventory and gravity, gravity will always win.

“Particularly when you think about vertical storage systems and racks, you need to think about how you keep the materials safe overhead,” says Eddie Murphy, president of Space Guard Products. “It’s true for palletized as well as unpalletized materials.”

He says there are a number of add-ons that can improve vertical storage, starting with pallet stops.

“They provide specific support, especially for unwrapped, palletized materials,” he says. “They will keep the pallet in place.”

Another solid idea is netting, which can be made from a variety of materials, from extruded plastic to nylon and metals. “Netting is a great option for heavier or sharper loads, and loads that can become unbalanced, like tires,” he says.

Safety is also a contributing factor in deciding how to better protect vertically stored materials.

“You always want proper safety measures, both for the materials and your employees – things do happen, and things do fall,” he says, noting that one of their clients recently had a side picker crash into a storage unit, causing 50,000 pounds of materials to crash to the floor.

Murphy says Space Guard Products is always looking for ways to innovate its product lines, and one of those was the introduction of BeastWire in 2016, which utilizes universal posts, panels and simplified hardware. “It has good installation time, and you don’t have to make changes to your existing shelving,” he says.

Theft can also comprise the ROI for warehouse operations. While this element doesn’t create product damage, it does result in product loss, which can also hurt your bottom line. Murphy says that all warehouse operators need to keep this on their radar.

“There are always internal and external threats to any operation,” he says. “Internally, high-value items – fine wines, electronics, and higher-value inventory, for example – can be fully fenced in or aisle gating systems can be installed that prevent entry and exit from pallet racks.”

He says that with the impact of COVID-19, some operations have established will-call or pickup areas for customers, which introduces a new opportunity for individuals to possibly access your warehouse inventory.

“In that case, a lot of people are adding a driver control or access-controlled area,” he says. “It’s a caged area that allows entry into the warehouse, but not directly into the area where your inventory is stored.”

Proper packaging, wrapping, storage and access can go a long way in reducing damage costs.

“In today’s supply chain, damaged goods reduce your ROI,” says “But the good news is that there are many things you can easily do, and even retrofit into your current system, that can help eliminate some of these problems.”

Laurie Arendt is an award-winning business writer based in Wisconsin. Her writing regularly appears in national trade publications in a variety of industries. To contact Laurie email editorial@MHNetwork.com.

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