Warehousing

WAREHOUSING
© Krishnan Subramaniam
Packagin
g
A & B Items
Componen
ts
WAREHOUSING
• Part of a logistics system that

• stores products
• at and between point-of-origin and point
of consumption,
• provides information to management of
the status and condition of items being
stored.
• The management of materials while
they are in storage.
OBJECTIVES OF WAREHOUSING
• Maximize User Service

• Minimize Costs
• Guarantee Safety
Sub-Objectives of Warehousing
• Effective Space Utilization

• Ready Access to All Items
• Quick Receiving of Materials
• Complete Inspection
• Coordination with Other Divisions
• Efficient Material Handling
• Maximum Protection of Materials
• Good Housekeeping.
Functions in the Warehousing cycle
Process
purchase Receive
orders materials
Store
materials Issue goods…..
Discuss
warehousing process
in your Workplace
Warehousing Functions
• Receiving
• Identification, Checking and Sorting
• Dispatching to and placing in Storage
• Storage
• Order Picking
• Order Accumulation
• Packing
• Shipping
WAREHOUSE FUNCTIONS
Secondary
Sorting
V
E
N Goods Reserved Order
Replenishment Collate/ Packing
D Receiving Storage Picking
O
C
R U
S
T
Sorting & Cross-Docking Dispatch
O
M
E
R
Flow Of Goods
MOVE-STORE ACTIVITES
RECEIVING Put-Away
• Schedule Carrier For Unloading
Input • Unload Vehicles
• Identify Product
• Identify Storage Location
• Inspect for Damage • Move Product
• Compare To Purchase Order • Update Records
Order Picking Storage/ Binning

• Information • Material Handling Equipment
• Walk & Pick • Stock Location
• Order Picking • Fast Moving
• Batch Picking • Unit Size
• Automated Storage • Cube size
& Retrieval Process (AS/R)
Collating
• Packaging SHIPPING/DISPATCH
• Labeling • Schedule Carrier For Loading
• Staging • Load Vehicles
• Lorry Receipt (LR)/
Output
WAREHOUSING Consignment Note (C/N)
• Compare To Purchase Order
PROCESSES© Krishnan Subramaniam
WAREHOUSING - ROLES
q Warehousing Serves Several Value-Adding Roles in the

Supply Chain
Value-Adding Roles Trade-Off Areas
ü Consolidation ü Transportation
ü Product Mixing ü Order Filling
ü Service ü Lead Times
ü Contingency Protection ü Stock Outs
ü Smooth Operations ü Production
q Warehousing Involves Costs But Often Adds More Value

q Warehousing of Goods Recommended Only If Trade-Off
Possible in Other Areas
TRANSPORT CONSOLIDATION
Physical Supply System
Supplier
Volume
Supplier
Distribution
Shipment
Plant
Warehouse
Supplier
Supplier
LTL for TL for
Short Distances Larger Distances
TL – Truck Load Rates – Lower

CL –Car Load Rates – Lower
LTL – Less-Than-Truck Load Rates – Higher
q Consolidating Small Inbound Into Larger Outbound Shipments
q Reducing Transport Cost By Consolidating Shipments at the
Distribution Warehouse
TRANSPORT CONSOLIDATION
Physical Distribution System
Plant Retailers
Distribution
Volume Warehouse Retailers
Plant
Shipment
Distribution
Plant Warehouse Retailers
TL for LTL for

Larger Distances Short Distances
TL – Truck Load Rates – Lower

FCL – Full Car Load Rates – Lower
LTL – Less-Than-Truck Load Rates – Higher
§ Product Mixing/ Bundling

§ Preparing Floor-Ready Merchandise
• Ticketing/ Labelling
• Marking - Apparel on Hangars
DISTRIBUTION CENTRE (DC)
Product Mixing/ Bundling
Plant 1 Customer
Products 1
C
A&B AB
Customer
FG 2
Plant 2 BC
Products Distribution
AG
B&C Warehouse Customer
3
A
Plant 3 B
C
D
Products E Customer
D&E 4
SC
Plant 4 TL
(Small Carriers)
Products (Large Trucks)
F&G
CROSS-DOCKING DC
Plant Inbound Outbound

Retailer 1
Dock Dock
DC
Plant Cross Docking Retailer 2
(DC)
DC
Plant Retailer 3
• Cross Docking Justified By Reduction in Transportation Costs & Time for

Product Mixing
• Supplies Packed & Invoiced as Per Retailers’ Orders at Suppliers’ End
• Supplies From Different Sources Combined as per Retailer-Orders at
• Cross-Docking DC & Sent To Respective Retailer-DC in Shorter Time/ Cost
• Goods Transferred Directly from Inbound to Outbound Docks
• No Storing in Cross-Docking DC
• Goods Along with Respective Invoices Leave DC Within 24 Hours
SUPPLY MIXING WAREHOUSE
Raw
Material A
Raw
Material B
Supply Mixing A B C D
LTL
Warehouse Plant
TL
Vendor
Source C
Vendor
Source D
Consolidation of Supplies from Different Sources

WAREHOUSING SYSTEM
• Storage Functions
• Accumulation of Inventory Over Time
• Depending on Purpose of Storage & Different Lengths of
• Time a Product Required to Remain in the Warehouse
• Different Locations in Warehouse Chosen for
• Storing Product Based on Purpose of Storage
• Material Handling Functions

• Loading & Unloading Activities
• Moving Products To and From Various Locations Within the
Warehouse
• Order Picking
STORAGE FUNCTIONS
• Holding (Providing Protection & Orderly Holding of Inventory)
• Holding Time/Storage Requirement Drives Store Configuration/ Layout
• Long-Term Specialized Storage (Ageing Liquors/ Wines)
• General-Purpose Merchandise Storage (Seasonal Goods)
• Temporary Holding of Goods (Truck Terminal)
• Consolidation
• Transportation Rate Structure/Breaks Influences Use of Storage Facilities
• Collection Point (Warehouse/ Freight Terminal) Used for Small
• Shipment-Consolidation To Avail More Economical TL Rates
• Bulk-Breaking (Opposite of Consolidation)

• TL Supplies Received from Long Distance Factory Broken into
• LTL Loads (Order) & Sent To Short-Distance Retail Outlets
• Distribution/ Terminal Warehouses Used to Break-Bulk
• Mixing
• Products From Different Suppliers Mixed to Assemble Retailer’s Orders
• For Delivering to Different Short-Distance Retail Outlets
STORAGE EXAMPLES
Tote Box Pallet
Storage/ Binning
Storing & Retrieval Using Reach Truck

MATERIALS HANDLING FUNCTIONS
q Loading & Unloading
• On Arrival at Warehouse Goods Are Unloaded from Trucks
• Packed Goods are Loaded on Outgoing Trucks
• Often Special Equipment are Required for these Operations
• Involves Various Activities of Checking Order Contents/ Order Sequencing etc.
q Movement Within Warehouse

• From Unloading Point to Storing Area
• Storing Area to Picking Area
• Picking to Staging Area
• Staging to Packing Area
• Packing to Docking Area
q Order Filling/ Picking

• Selection of Stocks From Storage Areas To Build Customer Order
• Order Selection May Take Place Directly From Semi-Permanent/ Bulk Storage
Area (Order Picking Areas)
• Often the Most Critical Material Handling Activity due to Small-Volume Orders
LOADING/ UNLOADING
Dockside Counter Balance Truck

SEMI MECHANIZED PICKING
WAREHOUSING DECISION TREE
Ownership
Private Public
How Many
Centralized Decentralized
What Size
Where (Warehouse Location)
Warehouse Layout
What Products Where

(Product Location)
Warehousing Decisions Made in a Trade-Off Framework

WAREHOUSING OBJECTIVES
• Achieve Maximum Efficiency in Organizing and Handling Flows at
Minimum COST
• Balance COST/ Utility by Adjusting Following Variables
• Number of Warehouses in the System
• Warehouse Building Size
• Width & No. of Aisles for Easy Movement of Material/ Men/ Equipment
• No. & Size of Shelves
• Internal/ External Material Handling Equipment
• Computer Systems
• Manpower
• Design Layout/ Equipment/ Organisation/ Systems to Facilitate
• Savings on Labour & Time
• Increase Speed of the 3 Flows
• No. of Warehouses Decided in Trade-Off With Logistics Costs

• As Number of Warehouses Increase
• Cost of Transportation & Lost Sales Decline
• Cost of Warehousing & Inventory Increases
Warehousing:The Ultimate Impact
Delivery of ….
• the right product
• in the right quantity
• in the right condition
• at the right place
• at the right time
• for the right customer
• at the right cost
WMS - Current trends
• RFID – Radio frequency Identification

• Voice picking
https://www.youtube.com/watch?v=yy53EMEmx_c
• Vision picking
https://www.youtube.com/watch?v=I8vYrAUb0BQ
• Robots
https://www.youtube.com/watch?v=quWFjS3Ci7A

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WAREHOUSING

• Part of a logistics system that

• Maximize User Service

• Effective Space Utilization

Order Picking Storage/ Binning

q Warehousing Serves Several Value-Adding Roles in the

Value-Adding Roles Trade-Off Areas

q Warehousing Involves Costs But Often Adds More Value

TL – Truck Load Rates – Lower

TL for LTL for

TL – Truck Load Rates – Lower

§ Product Mixing/ Bundling

Product Mixing/ Bundling

Plant Inbound Outbound

• Cross Docking Justified By Reduction in Transportation Costs & Time for

Consolidation of Supplies from Different Sources

• Material Handling Functions

• Bulk-Breaking (Opposite of Consolidation)

Tote Box Pallet

Storing & Retrieval Using Reach Truck

q Movement Within Warehouse

q Order Filling/ Picking

Dockside Counter Balance Truck

Where (Warehouse Location)

What Products Where

Warehousing Decisions Made in a Trade-Off Framework

• No. of Warehouses Decided in Trade-Off With Logistics Costs

• RFID – Radio frequency Identification

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