It usually doesn’t take long to search for your clothes. The socks are in a compartment, the sweater is well sorted on the shelf above. But sometimes there is no time for order and you let your blouse, jeans and belt disappear into the empty compartment above your T-shirt without thinking about it. That was the quickest solution. Now you have to remember, however, that your favorite jeans can no longer be found in their usual place in the warehouse. This is what chaotic warehousing could look like in everyday life.
The chaotic warehousing explained briefly
With chaotic warehousing, constantly changing, currently freely available storage areas are occupied with goods. This is done regardless of the product group, manufacturer, materials or other distinguishing features. There is no fixed assignment of a material group to a specific storage location with dynamic warehousing .
Chaotic and static warehousing in comparison
In the small description at the beginning of the text, you can quickly put your clothes in any cupboard compartment that is currently free. Of course, you will remember where to store your jeans, blouse and belt as an exception. At this moment you are running a chaotic warehouse.
Usually, however, you put each piece of clothing in its designated place. If the corresponding cupboard compartment is empty, you know that all your T-shirts are in the laundry basket at that moment. If you buy new clothes, you may have to reorganize your organizational system. You operate static warehousing.
Brief definition of static warehousing
According to sportingology, static warehousing is characterized by the fact that each stored item is assigned a fixed location in the storage system. Static warehousing is the opposite of chaotic warehousing. The goods may only be stored in the place intended for them.
Static warehousing explained using an example
Before the orderly warehousing begins, the storage area is already divided up. The products are assigned to specific storage areas before they are actually stored:
- Storage area A – towels
- Storage area B – soap dishes
- Storage area C – shower curtains
Storage areas A, B and C can only be occupied with the products assigned to them. If there is over- or underutilization at one point or another, the entire distribution of the storage areas must be redesigned.
Small businesses benefit from static warehousing
Static warehousing – also known as the fixed place system – is primarily used by companies that have a manageable inventory of items that changes little. The warehouse is also of a manageable size and has enough space to store goods that are in demand only occasionally.
Advantages and disadvantages of static storage
These companies benefit from static warehousing, as the occupancy can easily be organized by yourself without any storage software. The inventory can easily be viewed. The logistical processes are simple. Personnel can be deployed immediately after a short training period. Removals and storage are routine work.
The disadvantage of the fairground system is the low utilization of the storage space. Only about an average of 60 percent of the storage capacity is used in orderly warehouse management . This utilization can also be very unbalanced under certain circumstances. Empty storage areas are juxtaposed with storage spaces that are overflowing with goods.
A distribution of the goods to the free areas is not easily possible with static warehousing. However, unoccupied storage space represents tied-up capital that drives up the company’s fixed cost structure . After all, static warehousing can lead to disruptions in the process of storage or removal of goods: In the case of large quantities, jams occur during storage or retrieval.
When does chaotic storage make sense?
Whether chaotic warehousing makes sense or not depends entirely on the structure of your business model. If you have a company that offers a different range depending on the season or that changes regularly, chaotic warehousing makes sense for you. So you are able to use your free space in the warehouse flexibly. It is completely independent of what you have on the respective storage locations.
Chaotic warehousing makes sense from the following points of view:
- You want an efficient use of space
- The warehouse is large and therefore clearly laid out
- You are planning to purchase an inventory management system designed for chaotic warehousing or you already have one
Online retailers prefer dynamic warehousing
Chaotic warehousing, on the other hand, is interesting for those companies whose inventory changes quickly. Online mail order companies like Amazon work according to this warehouse logistics, because they work with constantly changing stocks, both in terms of product range changes and in terms of the quantities of items bought or sold. The time it takes to ship the goods is critical to the success of online retailers . Therefore, the dynamic storage system is very suitable for them.