Inventory Bin Systems: A Smarter Way to Manage Your Stock
Key Takeaway:
Inventory bin system is a method of storing stock in bin containers for easy tracking and retrieval in a warehouse.
Efficient inventory management can make or break a business. Whether you’re running a fashion brand, an e-commerce store, or a wholesale distribution company, how you store and track products directly impacts order accuracy, fulfillment speed, and customer satisfaction.
One proven method to bring structure to your warehouse is the inventory bin system.
In this article, we’ll explore what inventory bin systems are, how they work, and why they’re a must-have for modern businesses.
What is an Inventory Bin System?
An inventory bin system is a structured way of organizing items in your warehouse and storing them in bins, rather than simply leaving them on shelves. Each bin is given a unique label (like a number, code, or barcode) that makes it easy to locate items quickly.
Unlike general shelving or bulk storage, bin systems bring order and precision. They eliminate the chaos of searching through piles of products, instead providing a clear map of where every SKU (stock keeping unit) lives.
Streamline your processes with a tailor-made inventory management solution.
Types of Inventory Bin Systems
The three common types of inventory bin systems most businesses use are as follows:
Single Bin System
This is by far the simplest inventory bin management system. In this arrangement, warehouse items are stored in a single bin, with each bin used for a different SKU.
The advantage of this kind of system is that it not only saves you cost, but also a lot easier to manage. This makes it suitable for businesses with smaller product lines.
On the flip side, using a single bin system can easily lead to stockout problems, especially when stock levels deplete.
Two Bin Inventory System
In this type of system, two bins are used for different purposes. The first is the picking bin. It’s from this bin you pick items to fulfill orders. The other is the replenishment bin, which serves as a backup to the picking bin. It’s from it that you pick items when you run out of stock and are waiting for supply replenishment.
Ideally, you will want to have sufficient stock in the replenishment bin to cover the in-transit period.
One major advantage of this type of system is that it can be used to prevent overstocking and understocking problems. On top of that, it offers better inventory tracking and control.
However, it can be somewhat difficult to maintain, especially for smaller businesses.
Multi-Bin Inventory System
This is very much similar to the two-bin system, only that it utilizes three or more bins. Each bin is used at different reorder levels.
Benefits of Inventory Bin Systems
Here are some of the benefits inventory bins offer to eCommerce brands.
1. Improved Organization
A bin system eliminates guesswork from your warehouse operations. Instead of cluttered shelves and misplaced products, every item has a designated home.
This structured approach reduces confusion, prevents stock from “disappearing,” and makes warehouses easier to navigate.
2. Faster Picking and Fulfillment
When orders come in, speed matters. A warehouse bin system allows your warehouse staff to find items quickly and accurately. Clear bin locations mean less time searching, which translates into faster order processing and quicker deliveries, and this can give you a major competitive advantage.
3. Increased Inventory Accuracy
Human error is one of the biggest causes of stock discrepancies. With bins tied to barcodes, QR codes, or RFID tags, it’s easier to track exactly where each SKU is stored. This improves stock accuracy, reduces picking mistakes, and minimizes costly returns.
4. Better Space Utilization
Managing warehouse space can be costly. Keeping that cost as low as possible should be your topmost priority. This is where bin systems come in handy.
Bin systems optimize how products are stored by making use of vertical and horizontal space. Instead of spreading inventory haphazardly, bins create a structured layout that maximizes efficiency.
5. Scalability for Growth
As your business expands, managing inventory can increasingly become complex. A bin system provides a scalable foundation for managing larger product catalogs and higher order volumes. Combined with inventory management software, it can handle thousands of SKUs with ease.
The Challenges of Implementing an Inventory Bin System
Like any process improvement, implementing a bin system comes with its own set of challenges. Understanding these hurdles upfront helps businesses plan better and avoid costly missteps.
1. Upfront Investment
Transitioning to a bin system requires an initial financial outlay. You might need to purchase bins, labeling tools (barcodes, RFID, or QR codes), and possibly new shelving systems.
On top of that, you might also have to invest in an inventory management software to map bin locations may be necessary. These mounting costs can easily become overwhelming.
2. Time-Consuming Setup
Setting up a bin system isn’t as simple as dropping items into containers. It requires careful planning of the warehouse layout, assigning SKUs to specific bins, and labeling every storage location correctly. During this transition period, things may slow down in your warehouse or storage facility, which can cause temporary disruption.
3. Managing Large SKU Counts
If you manage thousands of SKUs, implementing a bin system successfully can be pretty hard. Assigning, tracking, and reorganizing bins for every size, color, and variation requires reliable systems and discipline. Without software integration, mistakes can happen easily.
Manage Your Inventory Bins Efficiently With Uphance
Uphance is a cloud-based ERP system which, among many things, allows you to track and manage your inventory using bins. With Uphance, you can easily create many different bins, each for a different purpose: storage, picking, returns and receiving.
Creating bins in Uphance makes it easy to accurately track stock as it moves across your warehouse and sales channels.
Curious to see how Uphance can help you streamline inventory control? Schedule a call with one of our reps right away!
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