Bin Location

What Is a Bin Location?

Giving every storage position an address turns a warehouse from a space into a directory. The code typically spells out which aisle, which bay, which height and which slot, and its purpose is entirely practical: somebody who has never been in the building should be able to walk to any item without asking. Everything downstream, from picking routes to replenishment triggers, depends on that being true.

For verification the address is what makes a strict test possible. Counting at position level asks whether each individual address holds what the record says, which is a much harder question than whether the building total agrees, because two mistakes pulling opposite ways yield a flawless total in a building from which nothing can reliably be picked. Location accuracy is therefore reported separately from quantity accuracy, and the two frequently tell very different stories about the same site. Where addresses are undefined, unmarked or obstructed, none of this is available and the count can only ever establish an aggregate.

Which Sectors Use Bin Location and Why

Addressed storage is used wherever the number of distinct items makes searching impractical.

• Spare parts distribution, which is the extreme case: tens of thousands of items, most of them small, most of them rarely touched.
• Third-party logistics, where clients are billed by space occupied and the address structure is also the billing basis.
• Organised retail distribution centres, whose pick paths are generated directly out of the address structure.
• Electronics manufacturing stores, holding thousands of components physically indistinguishable from each other.
• Pharmaceutical warehousing, where the position carries batch and condition attributes as well as quantity.
• It is unnecessary in bulk storage and in small operations where the whole holding is visible from one point and anybody can find anything by looking.

How Bin Location Works in Practice

1. The building is divided into a hierarchy, typically zone, aisle, rack, level and position, and every storage point is given a code following that structure.

1. Codes are physically labelled at the point itself, in a size and position readable from where an operator stands, and usually barcoded so they can be scanned rather than typed.

1. Every movement references a position. Goods are put away to one, picked from one, and transferred between them, so the system holds not just what is in the building but where.

1. Picking routes are computed from the address structure, which is why the coding has to follow the physical layout rather than an arbitrary sequence.

1. Verification counts at position level, comparing each address against what the system holds for it. That is a stricter test than a building total, since two mistakes cancelling each other leave the aggregate flawless in a building where picking still fails.

Bin Location: A Worked Example

A warehouse addresses 11,400 storage positions on this pattern.

The value is in the last row being unique and stable. Two people sent to D-14-3-2 arrive at the same place, a count sheet sorted by address walks the floor in physical order rather than zig-zagging, and a variance can be traced to a position rather than to a code. Where locations are described rather than addressed, the same shelf is recorded as near the shutter by one team and opposite the charging point by another, and the two records cannot be reconciled. Zone letters that encode the storage condition also stop ambient goods being put away into a chilled bay by somebody following a number alone.

Common Mistakes With Bin Location

An addressing scheme is only worth what its discipline is.

• Accepting a site total that agrees while individual positions do not, when offsetting errors produce a perfect aggregate in a building nobody can pick from.
• Leaving positions unmarked or labels unreadable, which forces staff to work from memory and removes any basis for location accuracy at all.
• Collapsing positional correctness and quantity correctness into a single percentage, when the two often say quite opposite things about one building.
• Assuming a recent implementation guarantees clean addressing, when the data was usually migrated from whatever preceded it.
• Creating addresses that do not follow the physical layout, so a picking route computed from them wastes more time than the scheme saves.
• Allowing overflow stock into undefined space, which is invisible to the system and found only by walking the building.

Related Stock Audit Terms

Some goods never reach a position at all, so goods-in-transit is the entry to read next. Every other term in this cluster is listed in the A-Z of stock audit terms, grouped by the part of the work it belongs to.