Professional Documents
Culture Documents
Packagin
g
A & B Items
Componen
ts
Warehousing
The warehouse is
where the supply
chain holds or
stores goods.
Functions of
warehousing
include:
Transportation
consolidation
Product mixing
Cross-docking
Service
Protection
against
contingencies
Smoothing
WHAT is
Warehousing ?
Supply Chain Consists of Nodes & Links to Move
Material From Point of Origin To Point of Consumption
Warehouses Are Nodes & Transportation Systems are
Links in the Supply Chain
Warehouse Provides Space for Storage & Holding of
Raw Material/ Consumables
Work-in-Process
Finished Goods/ Merchandise
Why do we WAREHOUSE
To Reduce Production/ Transportation Costs
Producing Economic Batch Quantities Reduces Production Cost
Offsetting Higher Cost of Warehousing & Inventory
Reducing Transportation Cost Using TL by Combining Different
Customers Deliveries
WAREHOUSE FUNCTIONS
Secondary
Sorting
V
E
N
D
O
R
Goods
Receiving
Reserved
Storage
Replenishment
Order
Picking
Collate/ Packing
Dispatch
C
U
S
T
O
M
E
R
ACTIVITES
Input
RECEIVING
Schedule Carrier For Unloading
Unload Vehicles
Inspect for Damage
Compare To Purchase Order
Put-Away
Identify Product
Identify Storage Location
Move Product
Update Records
Order Picking
Storage/ Binning
Information
Walk & Pick
Order Picking
Batch Picking
Automated Storage
& Retrieval Process (AS/R)
Collating
Packaging
Labeling
Staging
WAREHOUSING
PROCESSES
SHIPPING/DISPATCH
Schedule Carrier For Loading
Load Vehicles
Lorry Receipt (LR)/
Consignment Note (C/N)
Compare To Purchase Order
Output
Value-Adding Roles
Consolidation
Product Mixing
Service
Contingency Protection
Smooth Operations
Trade-Off Areas
Transportation
Order Filling
Lead Times
Stock Outs
Production
TRANSPORT CONSOLIDATION
Supplier
Supplier
Supplier
Distribution
Warehouse
Volume
Shipment
Supplier
LTL for
Short Distances
TL for
Larger Distances
Plant
TRANSPORT CONSOLIDATION
Plant
Plant
Volume
Shipment
Plant
TL for
Larger Distances
Retailers
Distribution
Warehouse
Retailers
Distribution
Warehouse
Retailers
LTL for
Short Distances
Customer
1
Plant 1
Products
A&B
Plant 2
Products
B&C
Plant 4
Products
F&G
FG
AG
TL
(Large Trucks)
BC
Distribution
Warehouse
Plant 3
Products
D&E
SC
(Small Carriers)
Customer
2
Customer
3
Customer
4
Consolidation Warehouses
Consolidation Warehouses
Shipment consolidation is an economic benefit of
warehousing.
With this arrangement, the consolidating
warehouse receives and consolidated materials
from a number of manufacturing plants destined
to a specific customer on a single transportation
shipment.
The benefits are the realization of the lowest
possible transportation rate and reduced
congestion at a customer's receiving dock.
Consolidation Warehouses
The primary benefit of consolidation is that it
combines the logistical flow of several small
shipments to a specific market area.
Consolidation warehousing may be used by a
single firm, or a number of firms may join
together and use a for-hire consolidation service.
Through the use of such a program, each
individual manufacturer or shipper can enjoy
lower total distribution cost that could be realized
on a direct shipment basis individually.
Processing/Postponement
Warehouses can also be used to postpone, or
delay, production by performing processing and
light manufacturing activities.
A warehouse with packaging or labeling capability
allows postponement of final production until
actual demand is known.
Processing/Postponement
Processing and postponement provide two
economic benefits:
First, risk is minimized because final packaging is
not completed until an order for a specific label
and package has been received.
Second, the required level of total inventory can
be reduced by using the basic product for a
variety of labeling and packaging configurations.
Stockpiling
The economic benefit of stockpiling comes from
the need of seasonal storage.
For example, lawn furniture and toys are
produced year-round and primarily sold during a
very short marketing period.
In contrast, agricultural products are harvested at
specific times with subsequent consumption
occurring throughout the year.
Both situations require warehouse stockpiling to
support marketing efforts.
Stockpiling provides an inventory buffer, which
allows production efficiencies within the
constraints imposed by material sources and the
customer.
CROSS-DOCKING DC
Plant
Plant
Inbound
Dock
Outbound
Dock
Cross Docking
(DC)
Retailer 1
DC
DC
Plant
Retailer 2
Retailer 3