Archive for March, 2018

March 18, 2018

5 Reasons To Get That Outdated Stock Off Your Storage Racking

If you’re in charge of warehouse inventory, there’s a good chance that you like to see things in order. You take pride in knowing where absolutely every pallet is at every moment, and that once the call comes in for a product you know exactly where it is on your industrial storage racks.

But knowing where everything is at any given moment also means that you know where the problem pallets are. In almost every warehouse there are those pallets that simply shouldn’t be there anymore, the ones that hold items that a warehouse manager just doesn’t know what to do with. These pallets stick around while the inventory on dozens of other industrial racks come and go.

It’s these specific pallets that need to be dealt with, and the sooner you get them off your storage racking, the better. Here are some of the reasons you should just go ahead and move them along in your efforts of warehouse optimization, despite the extra effort it’s going to take.

 

It Frees Up Physical Space

The primary reason to get rid of old pallets of unusable materials is so that you’re freeing up physical real estate within your warehouse. That pallet taking up space on your industrial shelving unit is going to get in the way eventually, no matter how far away you’ve tucked them in the back. Once you fill up your warehouse to the brim, it’s time to look into a new warehouse racking system…but there’s no reason to do so if you are keeping stuff you simply don’t need. Did you find a pallet of flyers from the last trade show? Don’t give it a second thought before recycling them. Have a pallet of paperwork that’s just a fire hazard now? It’s worth the few bucks to get them shredded and out of your warehouse.

Sure, it’s possible that you don’t need every inch of your warehouse space today. But when you do have a huge influx of inventory, wouldn’t you rather see an empty space in your pallet rack shelving than to have to deal with the problem when the new inventory is on its way? Which brings us to the following point…

 

It Frees Up Mental Real Estate

It’s not just physical real estate that you have to deal with when it comes to old inventory on your pallet racking system. It’s also the mental real estate that it takes. If you’re in charge of the warehouse inventory, you are likely always running into the outdated products and thinking “I really should do something about that.” A month passes, and dozens (if not hundreds) of storage racks are used over and over, and you still see that unmoving inventory and think “I really, really should do something about that.”

After a while, keeping something around for long past its purpose starts to feel like a failure. It didn’t sell, and it’s being ignored (but stays in the back of your mind) month after month. It’s best to just move it along in some way so that you never have to think of it again.

How can you move it along? Sell it! “But it hasn’t sold in all this time,” you might say. “I’d love to sell it, but it just won’t go.” Well…

 

It Could Get Some Cash

It might be time to cut your losses. Sure, it hurts to sell something for pennies on the dollar, but sometimes it’s just worth it to free up the physical and mental space that the unsellable pallets are taking up. In today’s world of internet sales and easy pallet shipping, finding a buyer for just about anything shouldn’t be a problem. It’s better to sell it for cheap now than to have it forced outside when you need every available industrial shelf for new product; a single rain could turn your product into trash.

The toughest part of selling it might be getting someone else to sign off on it. While you might want it gone, it might be difficult to get someone who doesn’t work in the warehouse to agree to let something go: “It might sell someday” they say. But bug them enough times and we bet they’ll cave, giving you that space back in the warehouse.

 

Tax Write Off

We’re no tax experts, but we know that keeping product around that isn’t moving can be a tax liability. But when you get rid of it, it could become a tax write off. You’ll get some credit for it if you give it away or pitch it, and you’ll also be freeing up warehouse space.

 

It Could Be Dangerous

Sometimes it can be difficult writing these articles to speak to everyone who might be reading them. After all, while some customers are using our industrial pallet rack shelving to store stuffed animals, others are using them to store antifreeze. It’s great that our storage racking is so flexible in terms of what they can be used for, but we’re certainly not going to suggest that one of our customers should get rid of that pallet of stuffed animals for environmental concerns.

But if there is something that could be potentially dangerous, it’s best to get rid of it. And even if it’s not dangerous, there are other reasons to move it along. Maybe it could cause a big mess if it ever fell, or leaks could lead to slip and fall hazards. Why have anything around that could cause you problems in the future?

 

Make The Most of Your Industrial Storage Racks

The fact is, there aren’t many warehouses in the world that don’t have some skeletons sitting around, waiting to be swept away. It’s always a good idea to free up space whenever you can, and it’s better to do so during your next downtime instead of during an emergency situation. When you’ve gotten to the point where you’ve gotten rid of your unneeded product and still need some space, Dak Equipment and Engineering will help you get your next warehouse management system up and running. Contact us right here to get the process started.

 

 

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March 14, 2018

Why Buying Pallet Rack Shelving NOW Could Save You Considerable Money

Steel prices are going up. While the price of most goods is determined by supply and demand, recent mine closures and increased tariffs on steel imports are raising the price of steel in the Midwest and throughout the country. If you don’t follow the price of steel, maybe you should; getting your industrial pallet racks now could save you quite a bit of money down the line.

 

Weekly Fluctuations Can Be Dealt With

Prices of raw commodities are always fluctuating. Crops, textiles, plastics, and, of course, metals are in a constant price flux. Unless a person is in the industry or has their eyes on investments, they might not realize that the price of steel is constantly fluctuating just like everything else. And to the average consumer, it’s not a big deal. When their greatest purchase of steel is a vehicle every few years, the price of steel isn’t affecting their lives much.

But when the products are steel, as is the case of industrial shelving, changes in prices can make their way through the manufacturing process and bump prices. Normally the change in price is small, and small changes in the price of raw materials don’t tend to affect the price of finished products. In the case of industrial pallet racks, minor changes will simply be absorbed by the manufacturers; a dollar rise in CWT (hundredweight) will be offset by the dollar fall next week. Changing the prices of finished products just isn’t viable on a weekly basis, and in the end it tends to even out.

 

Constantly Rising Prices Are A Problem

The problem now is that the fluctuations that are occurring are only heading up. Just two and a half years ago the price of steel rolls was $18.50/CWT, an abnormally-low price that quickly corrected itself by mid-2016. Since the beginning of the year, the price of steel rolls has gone up nearly ten dollars, from $32.63/CWT to $41.78/CWT. This is the highest price since 2011, and is heading toward the insane prices that we saw in 2008. Such steep increases in steel prices aren’t something that manufacturers of industrial storage racking can ignore, and the price of the product goes up.

 

So Why The Increase?

There are two major reasons that the price is steel is going up, one global and one domestic.

First of all, the price of raw iron ore is going up, thanks largely to mine closures in India. When that cheap ore became less plentiful, India raised its prices, and this created a ripple effect through the industry. Every ore supplier, both those internationally those in our own country, have raised prices accordingly. In the end, ore prices are up drastically since January.

The domestic reason is the increase in tariffs on steel that took effect March 23, 2018. These higher tariffs on steel from China and Japan will reduce the amount of steel available to the United States, almost certainly causing prices to rise further.

 

Are The Price Increases Over?

Steel prices have seen some steep increases so far this year, and most data indicates that it’s going to keep going up for the foreseeable future. While steel from some countries is still exempt from the greater tariffs — South Korea, the EU, Mexico, and Canada, for example — it’s still a possibility that tariffs will be raised on these steel imports as well, which would further cause the price of steel to increase.

Our suppliers are offering some of the steel pallet rack shelving they already have on hand at “pre-price increase” prices, but we don’t expect that to last long. In fact, but the time you read this there might have been a price increase, but by acting now you can avoid that higher price that seems inevitable as the cost of steel rises.

 

Get Your Industrial Shelves and Storage Racking Now!

If you’ve been considering a pallet rack system, now is the time to take the plunge before steel prices go up any more. We’ll get your industrial shelving ordered, install them with our professional team, and make sure that you’re making the most of your space. All it takes is a quick message to our consultants. Click here to get the process started!

 

 

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March 10, 2018

FIFO vs. LIFO: Pros, Cons, and How They Affect Your Warehouse Equipment

There are two main inventory rotation systems utilized by warehouses: FIFO and LIFO. While there are variations on these two systems used by many warehouses, these are the primary ones, and FIFO is by far the most popular. Which one your warehouse uses will affect what kind of pallet racking system and warehouse equipment you’ll need to use. Our warehouse consultants can help you determine which system is better suited for your inventory needs as well as help you get the equipment you need to make it all work.

FIFO or LIFO?

FIFO: First In, First Out

This inventory rotation system is better for warehouses that need to rotate their inventory in order to prevent items from perishing. It’s not just for perishables, though; if any of your stock is time sensitive, such as fashion-based products or items that are in a series, then FIFO is the way to go. If you don’t get the older stock out the door, it could go bad or go out of style and you could end up holding the bill for the inventory that can’t be sold.

What warehouse equipment is best for FIFO?

Carton flow racks and pallet flow racks are ideally suited for FIFO inventory control. You’ll be able to restock merchandise from the back of the racks while gravity moves the older stock to the front to be used in picking and packing. This allows restocking to happen without getting in the way of the pick team because each function is happening on separate sides of the racks. Gravity flow racks are a big time saver for warehouses because the items move forward independently without pickers having to dig around on the back of the shelf for anything. It can cut down on your labor expenses and get your orders out faster. Having a good pick module in a FIFO inventory system is often paramount to productivity, too, since items need to be moved out in order of their age. In that case, carton flow racks may be useful as well as conveyor belts in order to help get the product moved through the warehouse as quickly as possible. By and large, most warehouse storage systems are going to be useful in the FIFO system because of their widespread use in materials handling.

LIFO: Last In, First Out

This system of rotation is slightly rarer in distribution centers because it’s best suited for specific kinds of merchandise. It’s also beneficial if you are manufacturing your own goods; if the cost of manufacturing those goods goes up, it might be better from a cost-analysis standpoint to get the more expensive items out the door sooner. It’s also the easier option when it comes to restocking. Since you aren’t worried about using up the old inventory first, you can simply restock however it’s most convenient, even if that means just throwing the new items on top of the old.

One word of warning, though. There are tax implications when using the LIFO system, so you’ll want to be aware of them if this is the system you choose to use. If you start with LIFO, you’ll need to continue using it for the entire tax year, so be aware of the implications that could have on your company by speaking to a professional accountant.

What warehouse equipment is best for LIFO?

 

Push-back and drive-in pallet racking are both perfect for LIFO systems. That’s because they allow easy access to deposit and remove inventory from a single side. A forklift or other warehouse equipment can load up the racking system easily, meaning you’ll be able to restock your pallet racks quickly and with minimal fuss and push the older inventory to the back until it’s needed. When you need to remove the inventory, it comes out the same way. This is great for storage density, as you don’t have to worry about having access to the shelves from both sides like you would with a gravity flow rack. Along with your storage system, forklifts and pallet movers are often very useful in a LIFO warehouse since product will need to be moved in and out of the larger racking systems. Other warehouse storage systems that might be beneficial include double deep and triple deep racking setups.

Find the Right Warehouse Equipment for Your Inventory Control Needs

So which system is right for you? You’ll determine which one to use based primarily on the kind of inventory you are handling. If it’s at all time sensitive, then you need to set up for a FIFO rotation system. If your inventory is all the same and especially if you are manufacturing it yourself, then you’ll want to develop a warehouse setup that’s suited for LIFO. In either case and no matter what inventory rotation system you choose, you’ll want to talk to the DAK Equipment & Engineering team. We can help you develop a storage system that meets the needs of your inventory as well as your budget.

Get in touch with one of our project managers and let us provide you with a warehouse design that’s right for your business. Our team has experience with all different types of inventory rotation and setup needs, so we can find a system that works for you. You can get in touch with a project manager in your area by giving us a call or contacting us through our website today.

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