Warehousing Trends for the
21st Century
INTRODUCTION
• Warehouses will continue to play an important role in
the Logistics Supply-Chain as they have done since
Venice was the International hub of Commerce in the
“known world”
The “7” trends that take us into the 21st Century are:1. “Focus on Customer 2. “Consolidation of Ops”
3. “Continuous material flow and information”
4. “Value added services”
5. “Application of information technology
INTRODUCTION
(cont’d)
6. Space Compression
7. Time Compression
Also the rise of Third Party Warehousing and
Distribution, grown from increasing demands
from customers requiring better choice, keener
prices and improved quality.
“7 Trends”
1. Focus on the Customer
Wants:2.
3.
4.
5.
6.
7.
Consolidation of Operations
Continuous Flow of Material and Information
Emphasis on Value Added Services
Application of Information Technology
Space Compression
Time Compression
The Rise of Third-Party Warehousing
• 3rd Party Distribution is increasing instead of
storing goods in the company’s own warehouse
• Goods are sent out to be held in dedicated
facilities close to major road and rail routes
• The Client handles product development
marketing and sales. The logistics provider
does the rest
Why Third Party Warehousing?
Advantage to Client:- Flexible approach to distribution available related
directly to sales
• Margins are under better control
• New investments directed to where most cost effective
• Advantage to Provider:-
- Natural complement to forwarding and clearing
services already offered
• Complement Established Business Areas
• 3rd Party likely to be Logistics Growth Area
Third Party:- How Does it Work?
• Client or Supplier, notifies warehouse of incoming shipment
before goods arrive
• Goods brought in & client notified before receipt confirmed by
warehouse
• Stock if put away to bulk or front line storage awaiting order to
deliver
• Delivery order arrives as instruction from client
• Triggers picking Op. to Assy. Stock for order. Pack prepare for
despatch
• Onward Transport generally provided by logistics company,
inform Client when shipment despatched
• Some services go further – i.e. Logistics Company taking
electronic orders from end customers & printing invoices on
client stationery for delivery
Third Party:- How Does it Work?
(cont’d)
• IT – The solution:- provide latest info. on stock levels
and orders by client. Allows most effective use of
storage space avail. provide accurate recording and
billing of service
• EDI – essential part of warehouse operation
communication between parties. Enables client to
advise warehouse of incoming shipment and
deliveries required
• EDI – for receipt of delivery orders either std
message of customised format. Stock counts client
can view own stock and history
Breaking the Bonds
Traditional Bonded warehouse where importer of goods must
pay customs duties to released is disappearing
New practices evolved with dismantling EU frontiers warehouse
records customs documentation for inward & outward shipments.
Client pays duty on monthly despatches
Computer system used to:-
1. Distinguish Bonded and Free Stock.
2. Track customs documentation. 3. Provide effective access control.
4. Audit all stock transactions
The ability to offer this service is crucial in Winning New Clients.
Bar code:- Scanning technology – natural place in warehouse
Environment
Radio Data Terminals (RDT’s) – combine functions of computer
terminal and scanner
Warehouse Management
IT has changed the whole face of warehousing
management accounting for:1. Occupancy. 2. Weight Loading.
3. Location of other stock.
•
•
•
Pending stock movements can be queued and
transmitted to operator.
Stock counts more effective using bar scan technology
Individual deliveries tracked as they progress through
system
IT Services – Points to Note
1. IT Supplier needs good grasp on Logistics
2. Integration is key:- Supplier needs strong
range of products
3. Software adaptable to new client requirements
4. Packaging designed for third party warehouse
5. Integrate IT system with Ops and account
software
6. Facilities to send and receive information via
EDI needed
7. Attachments of bar scan/ RFID should be
made easy
The Way Forward
• Many companies see third party warehouse as a
key growth area
• Companies must demonstrate control of the
warehouse function
• The right partnership will improve efficiency and
give competitive edge
• Many retailers have extended e-commerce by
supplying data to suppliers via the internet
• Data available four hours after sale used for joint
demand and promotion and planning
Emerging Techniques and Technologies
1. Use of shared data via the internet
2. The ECRATE (returnable transit packaging)
seeks to develop an industrial standard
plastic crate
3. RFID (radio frequency identification) small
data storage and transmission devices
4. ‘MRTAG’ combination of ECRATE and RFID
to create intelligent crates
5. Distribution Warehouse Sortation Systems:conveyor based that facilitate automation
6. Intermodel Transport:- combination of road,
rail, air and sea