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The Role of Warehousing

Warehouses and distribution centers fulfil a critical role in the SC

Key functions performed by Warehousing

Kavram

Reasons to hold stock or inventory

Warehouse location decisions

Deciding how many warehouses to build and where to locate them, depends on the following main factors:

Warehouse physical layout

Effective storage and control

Product groupings within the warehouse

Categorisation of inventory within the warehouse

Steps of the warehousing process:

Cross docking

Typical Warehousing activities

The most common warehouse problems

Materials handling equipment

Link between Production, Transportation, Final end customer

Raw materials stored in warehouses before processing and finished goods

General needed for raw materials & finished goods

Provide a level of customer service at the total lowest cost

Link the producer and the supplier as the intermediary

Major function

Movement fuction

Storage function

Information transfer

Receiving

Transfer

Order selection

Shipping

Semi-permanent

Temporary

Occurs simultaneously with movement and storage function

Any system of storing products at any point in the logistics system from the point of origin of goods, through production to the point of consumption.kl

Warehouse and distibution center (DC) are used interchangeably although a DC holds inventory at the downstream end of the supply chain.

Warehouses refer to places where raw materials, work-in-process goods and finished goods are stored.

To achieve production economies of scale

To obtain purchasing discounts for large scales

To maintain the supply source

To support firms' customer service policies

To meet changing market conditions

To overcome time and space differentials

To accomplish least total cost logistics

To serve customer needs more effectively

To support just-in-time (JIT) programs

The firm policy and thinking

Do they prefer centralized distribution or many decentralized distribution

The cost-time calculation and the trade-offs

increase in price of petrol and diesel has become a major factor

The actual customer base

The geographic nature of the area

The physical layout of a warehouse impacts productivity of staff members who pick, pack and move goods and has cost implications when not managed effectively

Natural lighting, controlled access points, ergonomic and user-friendly picking design, all contribute to cost effectiveness

Seven essential steps and 10 general guidelines should be taken into account when warehouse layout and design are undertaken

Critical and non critical items

Table 4.1 Page 63

makes careful use of rows, levels and stacks

Goods that have been stored, must be found easily if they are picked for outbound distribution to the customer or during stock-taking activity

Compatibility

In terms of similarity

Complemetary

How often products are ordered together

Popularity

Dependent on turnover rates or demand rates

According to demand frequency

According to pick destination

According to special storage requirements

Hazardous

Perishable

1. The inbound logistics function

2. Inventory management and storage

3. The outbound logistics function

Putting the right stock in the right place

Giving the right code to the right product

Developing a coding system

Logistics process that minimises the need for storage

1. Receiving

2. Put-away

3. Storage

4. Packaging

5. Ship-prep

6. Shipping (transport)

Storage space utilisation

Product handling problems

Equipment problems

Labour intensity

Information gaps between warehousing, manufacturing or retailing

Costing and budgeting

Category 1: Forklifts and pallet handling equipment

Category 2: Turret trucks and reach trucks

Category 3: Scanning equipment and new technologies

Category 4: Portable storage racks and other devices