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Inventory and Warehouse Visibility: Color Coding Returns to Increase Efficiency

Posted on February 4, 2009 by Arianna

Color coding has been used for many years and by many different organizations. A color code is a method that allows information to be displayed by using different colors. Restaurants use them to note what day of the week a salad was made, or when a food package was opened.  Even our Department of Homeland Security uses it to inform us of our government’s national threat level.  So when I was told that a customer’s return had been sitting in our warehouse for an uncaccpetable amount of time before being inspected … I knew that I needed to find a solution.

The Issue:

Large box returns were being delivered and placed in our “Inbound” section of the warehouse, while smaller packages were being positioned on top. When our warehouse manager went in to inspect the returns they would automatically collect all of the smaller packages first. At the end of the day when they were unable to inspect any further returns, the remaining boxes were taken back to our inbound section. The next day as UPS delivered more returns, the smaller boxes were again placed on top of the larger boxes, and so with this continuing cycle our customers return was continually overlooked.

The Experiment:

I remembered how easy color coding was when I worked at a café, and so I decided to experiment. I went to a local office supply store and purchased color coded stickers that were large enough to write on. There were five colors, one for each day of the week. Our warehouse manager was to place a color sticker on every box that arrived on that day. Mondays was a yellow sicker, Tuesdays was green, Wednesdays was brown…etc. That way we knew exactly what day a package arrived at our warehouse. On Tuesdays our warehouse would inspect Monday’s returns, on Wednesdays they would inspect Tuesday’s returns and so on. This seemed to work perfectly! However the cost of the stickers was pretty high.

The Solution:

As we realized how amazing the stickers worked we went in search of some less costly stickers and were able to find them on We began this adventure about two weeks ago and it has been amazing! Our warehouse is more organized, and our customers are made happy when their return is inspected within one or two days of its arrival.

When we first found out about the issue we had no idea how we would fix it. We started talking about getting more warehouse space and even hiring a new employee. Though the stickers solved our issue for now we know that as our company continues to grow this process will have to be reviewed – but for now we love it!

I was completely proud of the fact that we were able to solve the issue with color coding stickers! I’m sure that there have been many companies that were faced with an issue and found a pretty simple and cost effective solution. Feel free to tell us about your cost effective solutions – we’d love to hear about them!

Till next time, remember that a problem is only an opportunity for an excellent solution! 


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