How to Keep Costs Down and Profits Up During a Trade War


US-China-Trade-WarLast week President Donald Trump said that he will add a new tariff on $300 Billion of Chinese-made products on September 1, which would effectively put a tax on all Chinese goods coming into the United States. Later in the day, Trump said in remarks to reporters at the White House that he might still ratchet tariffs up to 25%, as he's previously threatened -- or even higher.

What does this mean for the consumer? The new tariffs will his US consumers who want to purchase items such as iPhones, toys, shoes, clothing, and more. The tariffs were imposed last year on industrial materials, but the result was not better for US businesses. Now with the current threat of new tariffs, analysts forecast that US consumers, not China, will suffer more from the weight of the imposed duties. 


Now is the time that many retailers are ordering and stocking up on their holiday merchandise. 

About 85% of toys sold in the US come from China along with 41% of apparel and 72% of footwear

In an article in FoxBusiness.Com, American Apparel & Footwear Association CEO Rick Helfenbein told FOX Business that President Trump’s plan to increase tariffs on Chinese goods would hurt U.S. retailers, saying, “Businesses have barely been able to survive the 10 percent tariff. 25 percent is not survivable.”


What can you do to keep your costs down so your profits will be up?

UNEX suggests you can reduce operating costs by reducing warehouse space by optimizing warehouse space utilization. Reducing the amount of warehouse space you rent can lower costs, but to make the most of your existing space, you need to maximize the warehouse space with help from products like UNEX Speedcell

UNEX Span-Track Bed in Warehouse with Vertical Space Utilization

Sometimes it's feasible to reduce the square footage of a warehouse by consolidating shelving that is not being used or getting rid of slow-moving and obsolete items. Reducing the square footage of the warehouse reduces costs, decreases pull on labor resources and improves efficiencies. 


When warehouse space is utilized properly, space is not wasted. For example, if the storage rack is positioned to hold a 4-feet by 4-feet box, but the largest container is only 3-feet x 3-feet, then there is space that could be utilized by re-positioning the rack. More items would be able to be stored in the same amount of space. 


If products are stored in the right slot locations in the right storage medium in the warehouse, then workers have easier access to products. Proper slotting of items helps to maximize space utilization and increase storage density.

High-density pick modules are multi-level; a combination of mezzanines, conveyors, carton flow racks, pallet racks, static racks, and other equipment that delivers goods to pickers at each level. By stacking the racks, less space on the floor is taken while pickers can take less time to pick orders from the rack of SKUs that are close by and easy to reach. 

UNEX Span-Track Wheel Bed in High Density Pick Module


By using carton flow like UNEX Span-Track, in the picking operation, cartons can be replenished from the back of the shelving while picking goes on at the front. Pickers can pick from open boxes or individual items on shelves. Pallet flow systems allow the pallet to flow forward once it has been picked. Conveyors can tie everything together in the picking operation by bringing items to the picker or transporting empty cartons and pallets away so they can be recycled. 

Increasing storage density, eliminating dead air space, and speeding picking operations can help you maximize your warehouse space while keeping costs down. Do these things and your business can survive the volatile economic woes of today’s marketplace. 
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Posted by: UNEX