Logistic Management
Warehousing
Meaning
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The warehouse is where the supply chain
holds or stores goods.
A warehouse is typically viewed as a place
to store inventory.
However, in many logistical system
designs, the role of the warehouse is more
properly viewed as a switching facility as
contrasted to a storage facility.
Objectives
•better
customer service
•low operating cost
•Maximum utilization of storage space
•Higher labour productivity
•Maximum Asset utilization
•Reduction in material handling
•Increase in inventory turnover
•Reduce order filing time
Warehousing Function
•Material
•Material
Storage Function
Handling Function
•Information
Handling Function
Material Storage function
Due to non synchronization of Manufacturing cycle
with that of the consumption cycle of the material ,
storage of the material remains a big hurdle.
Holding
• Consolidation
• Postponement
• Break Bulk
• packing
• Cross Docking
•Mixing
•
FUNCTIONS
Material Handling function
Efficient short distance movement in or
between buildings and a transportation
agency.
1)Loading & unloading,
2)Material movement
3)Order filing
Information handling function
Goods
inward
Inspection & auditing
Goods outward
Excess Stock
Invoicing
Warehouse expenses
Transit damage & Breakage
Consignment tracking
This all information facilitate quick decision
Basic Warehouse Operations
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Movement
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Receiving
Put-away
Order picking
Shipping
Storage
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Stock location
Warehouse Management System
(WMS)
Warehouse Operations
BENEFITS OF WAREHOUSING
1)Consolidation warehouses
1)Shipment consolidation is an economic
benefit of warehousing.
2)With this arrangement, the consolidating
warehouse receives and consolidates
materials from a number of manufacturing
plants destined to a specific customer on a
single transportation shipment.
3)The benefits are the realization of the
lowest possible transportation rate and
reduced congestion at a customer's receiving
dock
Consolidation Warehouses
2) Break bulk warehouses
1)Break bulk warehouse operations are similar to
consolidation except that no storage is performed.
2)A break bulk operation receives combined customer
orders from manufacturers and ships them to individual
customers.
3)The break bulk warehouse sorts or splits individual
orders and arranges for local delivery.
4)Because the long-distance transportation movement is a
large shipment, transport costs are lower and there is
less difficulty in tracking.
Break bulk warehouses…
Alternative Warehouse Strategies
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Warehouse alternatives include:
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(1) Private warehouses,
(2) Public warehouses, and
(3) Contract warehouses.
A private warehouse facility is owned and managed
by the same enterprise that owns the merchandise
handled and stored at the facility.
A public warehouse, in contrast, is operated as an
independent business offering a range of services
such as storage, handling, and transportation- on the
basis of a fixed or variable fee.
Public warehouse operators generally offer relatively
standardized services to all clients.
Alternative Warehouse Strategies...
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Contract warehousing, which is evolving from the public
warehouse segment, provides benefits of both the private and
public alternatives.
Contract warehousing is a long term, mutually beneficial
arrangement which provides unique and specially tailored
warehousing and logistics services exclusively to one client,
where the vendor and client share the risks associated with
the operation
Warehousing Strategy…
It may be more efficient to build private facilities to cover the 75
percent requirement and use public facilities to accommodate
peak demand.
Warehousing Strategy…
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The second form of combined public warehousing may
result from market requirements.
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A firm may find that private warehousing is justified at
specific locations on the basis of distribution volume.
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In other markets, public facilities may be the least-cost
option.
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In logistical system design the objective is to determine
whatever combination of warehouse strategies most
economically meets customer service objectives.
Warehousing Strategy…
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An integrated warehouse strategy focuses on two
questions.
The first concerns how many warehouses should be
employed.
The second question concerns which warehouse types
should be used to meet market requirements.
For many firms, the answer is a combination that can be
differentiated by customer and product.
Specifically, some customer groups may be served best
from a private warehouse, while a public warehouse may
be appropriate for others.
Warehouse Layout and Design
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Develop a demand
forecast.
Determine each item’s
order quantity.
Convert units into cubic
footage requirements.
Allow for growth.
Allow for adequate aisle
space for materials
handling equipment.
Warehouse Layout and Design
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Provide for the
transportation
interface.
Provide for orderpicking space.
Provide storage
space.
Warehouse Layout and Design
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Principles:
Use one story facilities
where possible.
Move goods in a straightline.
Use the most efficient
materials handling
equipment.
Minimize aisle space.
Use full building height.