warehouse management

Warehouses and distribution center yards are critical links in the supply chain, connecting carriers and storage facilities. Effective yard management — tracking and managing all activities in the yard — is essential to keeping operations running smoothly, but it is a complex process.

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The Food and Drug Administration (FDA) has issued new requirements for additional traceability records for certain foods, ranging from nut butters to cut veggies to shrimp, under the Food Safety Modernization Act (FSMA). The requirements, which take effect on Jan. 20, 2026, create new traceability record keeping requirements beyond those in existing regulations for certain foods. All entities in the supply chain will be subject to the Food Traceability Rule.

The FDA said the changes, which require entities to share information with others in the supply chain, will allow for faster identification and rapid removal of potentially contaminated food from the market, resulting in fewer foodborne illnesses and/or deaths.

The list of foods includes some cheeses, eggs, certain vegetables, including cucumbers and leafy greens, some fruits, including melons and tropical tree fruits, fresh-cut fruit and veggies, some fish, nut butters, and ready-to-eat deli salads, such as egg salad, potato salad, pasta salad and seafood salads.

In preparation for the new requirements, which are less than three years away, it’s essential to start evaluating current warehouse management system (WMS) capabilities now to be best prepared for the near future. Since traceability in our food supply chain is essential to providing better service to our customers and end consumers, and a detailed record-keeping system is important for all the foods we handle in our food chain, making updates now will lead to a seamless transition when the new requirements become mandatory.

Key Data Elements and Critical Tracking Events

As part of the rule, those who manufacture, process, pack or hold foods on the Food Traceability List (FTL), must maintain and provide to their supply chain partners specific information — called Key Data Elements (KDEs) — for certain Critical Tracking Events (CTEs), in the food’s supply chain.

For example, if a distribution center (DC) receives the repacked fresh cucumbers from a produce processor, it must keep records on the receiving KDEs of the fresh cucumbers. Since the DC will be shipping the cucumbers to a retail store, it must maintain KDEs related to the shipping of the cucumbers to the next point in the supply chain, the retailer. The DC must also send the KDEs to the retailer.

Records must be kept regarding where the shipping event began and where it ended, meaning where the food was received. Still, the FDA said it is unnecessary to have records of the food's route, including any instances where it may have been moved from one carrier to another. Also, for cross-docking situations where food is arranged for transport from point A to point B but is briefly placed on a loading dock at point X at the DC to be transferred from one truck to another, records don’t need to be kept for point X.

Key Data Elements for those receiving food include:

  • Traceability lot code for the food
  • Quantity and unit of measure of the food
  • Product description for the food
  • Location description for the immediate previous source (other than a transporter) for the food
  • Location description for where the food was received
  • Date the food was received
  • Location description for the traceability lot code source or the traceability lot code source reference
  • Reference document type and reference document number

Key Data Elements (to maintain and provide) for those shipping food include:
  • Traceability lot code for the food
  • Quantity and unit of measure of the food
  • Product description for the food
  • Location description for the immediate subsequent recipient (other than a transporter) for the food
  • Location description for the location from which the food was shipped
  • Date the food was shipped
  • Location description for the traceability lot code source or the traceability lot code source reference
  • Reference document type and reference document number (maintain only)

Traceability Plan

All parties covered by the rule must create a traceability plan, and several are specific to those holding the food, such as a DC. The plan must include a description of the procedures used to maintain the required records, including the format and location of the records. It also needs to have a description of the procedures used to identify foods on the FTL and a statement identifying a point of contact for questions regarding the traceability plan and records. Traceability plans must be updated as needed to ensure the information reflects current practices and previous traceability plans must be maintained for two years after an update.

The Importance of Equipment, Technology and Training

There are several layers to the FSMA, which was signed into law in early 2011, and several requirements apply to the transportation and storing of food. All parties in the supply chain need to ensure they’re complying with current requirements and prepared to meet upcoming compliance dates.

FSMA includes requirements surrounding vehicles and transportation equipment, which must be “adequately cleanable” to allow the sanitary transport of food and “must be stored in a manner that prevents harborage of pests or becoming contaminated in any other manner that could result in food becoming adulterated.”

The ability to track and trace products is at the heart of several requirements, making the right WMS a vital resource. Tier 1 systems provide information on where products are stored and have embedded algorithms that can find ways to maximize productivity and the movement of product in and out of the warehouse.

It is also important for those transporting and storing food to be current on the latest requirements and best practices. Penske Logistics has earned Cold Carrier Certification, adding to its strategic approach to safety. The certification, which is the first of its kind, recognizes cold trucking carrier companies that comply with the Refrigerated Transportation Best Practices Guide from the Global Cold Chain Alliance, a trade association representing all major industries engaged in temperature-controlled logistics. Additionally, Penske associates undergo regular training to ensure food safety.

Foods on the Traceability List

Foods that will be subject to greater requirements in 2026 include:

  • Cheeses, other than hard cheeses
  • Shell eggs
  • Nut butters
  • Cucumbers
  • Herbs (fresh)
  • Leafy greens (fresh and fresh cut)
  • Melons
  • Peppers
  • Sprouts
  • Tomatoes
  • Tropical tree fruits
  • Fruits (fresh cut)
  • Vegetables (fresh cut)
  • Finfish
  • Smoked finfish
  • Crustaceans
  • Molluscan shellfish, bivalves
  • Ready-to-eat salads

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Warehouse location refers to the specific spot, such as a shelf or a bin, where a product is located within the four walls of a warehouse. Location impacts the efficiency and timeliness of picking by letting warehouse workers know the exact location of an item. When designing a warehouse, data can be assessed so that the product most often picked is placed in the most efficient spot. As products change and demand for products changes, the inventory layout can be updated to ensure continued efficiency.

What Is Warehousing?

Warehousing is the utilization of a warehouse to store and process products. Warehousing is important for businesses that manage inventory as having a central location or locations for product storage helps to keep things organized and manageable, while also allowing for efficiency and productivity in operations. Warehousing is an important part of the supply chain and effects everything from inventory slotting to on-time customer delivery. If the operations within a warehouse are ineffective, the entire supply chain may be immobilized through lack of product or delays.

What Is Slotting?

Slotting refers to the placing of inventory efficiently within the warehouse and coordinating product placement based on what moves the fastest. (e.g., products that move the quickest would be placed closest to the dock to minimize travel and save time). Inventory is assessed and identified regarding how quickly it moves. The quickest movers go closer to the dock to minimize travel, so employees can pick them faster and get them out the door. The slow movers are stored on the floor further away from the dock. If there is racking, they can be stored at the higher locations. The goal is to make it easy to put the product away and more efficient to pick the product. Inventory is reviewed consistently to account for any shifts in product popularity due to demand, holidays or a change in seasons.

Receiving inventory is the act of inspecting, verifying and accepting a shipment into inventory within a warehouse or operation. In a transparent supply chain, every link has access to relevant information on the origins and status of products, including when inventory will arrive. Effective inventory receiving requires the development of a safe, fast and organized process for handling received inventory, and a process for accurately tracking that inventory from the time it arrives in your warehouse to the time it's shipped.

Replenishment stock includes goods moved to restore inventory and keep the right product in stock within the warehouse or operation. At Penske, the replenishment process is managed through its warehousing services, transportation management, brokerage services and logistics planning. In addition, by also utilizing technology, a company can quickly provide detailed information on inventory, order status and potential at-risk situations to avoid crisis and ensure the right product is in stock within the warehouse. Stock replenishment is an important part of managing inventory as it ensures the right stock items are there to meet customer demand.

What Is Racking?

Racking is a type of system utilized within warehouses to store and organize products on multiple levels. Racking can be single-deep, double-deep, push-back or drive-in depending on the size of the warehouse. Racking is a good storage solution option in situations or geographic locations where warehouse space may be more expensive as it might be most cost effective to utilize the vertical space versus the square footage in a specific warehouse.

What Is a Rack?

A rack is framework or equipment utilized for storing inventory. Racks are a structural design and can include shelves, rails, bars, hooks, pegs and more. Racks are one of the most-used tools within warehouses to manage inventory and maintain organization prior to picking and shipping. They can easily double or triple the amount of usable storage area by utilizing both vertical and horizontal space for inventory.

What Is Pick-to-Light?

Pick-to-light is a system of picking that guides employees by using lights and monitors at the storage locations to direct workers on what to pick and where to place the items. This method of order picking improves efficiency, accuracy and speed, and typically removes any language barriers

What Is a Pick List?

A pick list is the list of items to be picked from inventory to fulfill an order. A pick list often indicates the product to be picked, where that inventory is located and other useful information that pickers may need to know in relation to the order.

What Is Pick-to-Carton?

In the pick-to-carton type of order picking, a shipping container is first chosen based on item dimensions and/or weights then items are picked and put directly into the shipping carton. This type of order picking is similar to pick/pack, though with pick-to-carton, the shipping container is selected prior to picking items.

The pick-to-trailer method is a picking method where the products are picked from inventory then placed directly into the shipping trailer. This method of order picking is similar to pick-to-carton or pick/pack, with the trailer taking the place of a shipping container.

What Is Pick/Pack?

Pick/pack or pick 'n pack is the fulfilling of an order by picking products from an inventory location and then packing them directly into a container for shipment. This type of picking is typically used to fulfill smaller orders for retail and can cut down on time by eliminating the need for repacking.

A warehouse control system (WCS) is a software that provides visibility across the entire supply chain, allowing insights into the inventory of critical items and a collaborative, real-time connection between warehouses and distribution centers. The WCS ensures everything is running smoothly and is fully optimized. It can easily integrate with a warehouse management system and is also designed to liaise with and control the automated equipment being used throughout the warehouse facility.

Warehousing space is at a premium and represents a significant portion of total supply chain costs. Consequently, shippers need to carefully evaluate the case for investing in more storage capacity.

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As companies respond to increasing demand for sustainable products and services, the role of supply chain network design in supporting and furthering their green goals is gaining in importance.

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Cross-docking – unloading product from an inbound truck and loading it directly onto an outbound truck – is a well-established logistics practice that is growing in importance as a way to manage risk in the supply chain.

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Growth in e-commerce and changes to companies' inventory policies have increased demand for warehouse space, and the existing network is filling up. E-commerce is expected to increase during the holidays as customers social distance and shop from home. The Wall Street Journal has reported that retailers are working to find more space and locking in additional fulfillment capacity for holiday items, such as toys, and essential goods, such as paper towels.

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Penske Logistics has been named Dedicated Fleet Carrier of the Year by Whirlpool Corporation. The company was recognized for their stellar dedicated contract carriage services. Whirlpool allocates this honor to fleet providers that provide crucial on-time pickup and delivery services. Penske earned this award for inbound supply chain services to Whirlpool manufacturing facilities in the Midwestern U.S.

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