Warehousing

A warehouse is a commercial building for storage of goods. Warehouses are used by manufacturers, Wholesalers, retailers, importers, exporters, customs etc.

Warehouse

They are usually large plain buildings in industrial areas of cities and towns. Today warehouses are not used to store things but rather to receive, breakdown, repackage and distribute components to a manufacturing location or finished products to customers

Warehouses

Some warehouses are completely automated, with very few workers working inside. The pallets and product are moved with a system of automated conveyors and automated storage and retrieval machines coordinated by programmable logic controllers The direction and tracking of materials in the warehouse is coordinated by the WMS, or Warehouse Management System, a database driven computer program.

The WMS is used by logistics personnel to improve the efficiency of the warehouse by directing putaways and to maintain accurate inventory by recording warehouse transactions.

FUNCTIONS OF A WAREHOUSE

Receiving, Storing, switching, change SKU size, Allows stock rotation (FIFO, LIFO), Buffer stock for customers retail or commercial, Command and control centre inventory control, Enables off-the-shelf (JIT) for customers, Provides a more-local 'Market Presence'.

FUNCTIONS OF A WAREHOUSE Consolidation and Break-Bulk Assortment (Cross Docking, Mixing) Postponement (Packaging, Labelling) Stockpiling (Seasonal, Bulk-Buy) Reverse Logistics

Consolidation:

Groupage (Consolidation)
Goods from a number of suppliers are grouped together for single delivery points, A range of goods from single suppliers are grouped together for each customer.

Supply Chain Management

Plant 1

Store A Plant 2

Consolidation Warehouse

Store B Store C

Plant 3

Break Bulk:
Receives customer orders from manufacturer and delivers to different customers.

A break bulk operation receives combined customer orders from manufacturers and ships them to individual customers. The break bulk warehouse sorts or splits individual orders and arranges for local delivery.

Supply Chain Management

Store A

Break-Bulk
Plant

Warehouse

Store B Store C

CROSS-DOCK = No storage(?)

Cross-dock (from multiple suppliers): goods sorted as they arrive, goods moved across dock and loaded onto trailers, benefits - optimal vehicle use and low handling costs, requires sophisticated planning techniques.

Cross Docking

Transferring goods from incoming trucks

Avoids placing goods into storage Requires suppliers provide effective addressing (bar codes) and packaging that provides for rapid transshipment

at receiving docks to outgoing trucks at shipping docks

Incoming

Outgoing

Sainsbury's distribution timetable

Early evening Goods arrive at warehouse from supplier.

Overnight Sorted and packed. Early morning Despatched. 7.30am On store floor.

Warehouse Ownership Classification: Private (Ownership or Lease) Public (Standardized service, relationship is less
important)

Contract (Customized, mutual benefits, long term

commitment, Good relationship)

Automated Warehouse of IKEA

Warehouse Planning:

Location Analysis Site selection Design Product mix Future expansion

Before selecting site, there is some location analysis techniques that could assist company in selecting a general area for warehouse location.
o

Location Analysis

Location Factor Rating

The location factor rating technique may be used when many sites are available, and each site has some appealing characteristics. The purpose of the technique is to "score" each site to be somewhat objective about the location decision. The steps in using the technique are:

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Center-of-Gravity Technique

The center-of-gravity technique can be used when multiple suppliers or customer bases exist at different geographic locations, and it is economically sensible to locate centrally to service all of them. In general, transportation costs are a function of distance, weight, and time.

Once location analysis is completed, a specific building site must be selected.

Site Selection

The primary factors in site selection are the availability of services and cost. The cost of procurement is the most important factor governing site selection. Beyond procurement cost, setup and operating expenses such as rail sidings, utility expenses, taxes, insurance rates, and highway access require evaluation.
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Several other requirements must be satisfied before a site is purchased

Site Selection

Necessary utilities must be available. The soil must be capable of supporting the structure, and the site must be sufficiently high to afford proper drainage

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Design Criteria:

Warehouse design criteria address physical facility characteristics and product movement.
Three factors to be considered in the design process are:
the number of stories in the facility, height utilization, and product flow.

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Number of stories in the facility

The ideal warehouse design is limited to a single story so that product does not have to be moved up and down. The use of elevators to move product from one floor to the next requires time and energy.

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Height Utilization:

Regardless of facility size, the design should maximize the usage of the available cubic space by allowing for the greatest use of height on each floor.
Most warehouses have 20- to 30-foot ceilings, although modern automated facilities can effectively use ceiling heights up to 100 feet. Maximum effective warehouse height is limited by the safe lifting capabilities of material-handling equipment, such as forklifts.

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Product-Mix Considerations

The design and operation of a warehouse are related directly to the character of the product mix.
Each product should be analyzed in terms of annual sales, stability of demand, weight, and packaging. It is also desirable to determine the total size and weight of the average order processed through the warehouse.

Future Expansion

Future expansion is often neglected when an enterprise consider initial establishment of its warehouse facilities. Well-managed organizations often establish 5 to 10 year expansion plans.
Such expansion considerations may require purchase or option of a site 3 to 5 times the size of the initial structure.

Warehouse Security

Pilferage protection (Theft,) Product deterioration (Damages)

Safety and Maintenance

Health and safety Incidents Environment

Warehouse management System (WMS)

Computer software designed to manage the storage and movement of items throughout the warehouse.

Home Assignment: Role of Barcodes, RFIDs and Voice picking technology in Warehouse & Role of MRP, MRPII and ERP systems in SCM

End of Topic