Warehouse Logistics: How does the US compare to Europe

With a background in European warehouse logistics and plenty of experience in the same field on the US market, we are often asked to draw a comparison.

Working with companies in the United States, Logistics Advice, Inc. finds both similarities and differences. If you take a close look at warehouse operations on each side of the pond, you will find that European companies are generally better automated and organized. Obviously there are many US companies with top notch warehouse automation, automated picking systems, unmanned cranes, etc. But I would argue that this type of automation is more wide spread in Europe. It is not surprising that most material handling equipment is designed and manufactured by European (mainly German) companies.

The main reason for the difference is space, or better yet the lack of it! The shortage of space in most European countries has motivated people to find creative ways to use space efficiently. This does not simply mean to make aisles and forklift trucks narrower and buildings higher, it touches every single aspect of a warehouse operation and the company. From warehouse automation to inventory levels, from batch vs. single order picking to the implementation of procedures, it all needs to be optimized and synchronized. Even the way an order is processed by the Sales department has a big impact on the efficiency (or inefficiency) of a warehouse operation.

Even though many US companies are less confronted with the space issue, they should nevertheless actively work on identifying the same bottle-necks as if there was a lack of space. Once a company managed to cut back on the space it is using, it is not only able to profit from the empty space (by renting to another businesss or postponing their own move to a larger building), it will have created a smoother operation. It cut costs and therefore improved profits. The level of professionalism also increases the company's market share and results in additional revenue.

Anything that helps to increase warehouse productivity and inventory turnover will save space and costs. And analyzing the process and identifying those bottle necks definitely pays off!