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WAREHOUSING
MANAGEMENT
Gaurav Narkhede | Josue Servalis |   Mike Macas   |
             Praneetha Boda
• Part of firms logistics system that stores
  products at and between point of origin and
  point of consumption.

• Term “Warehousing” is referred as
  transportation at zero miles per hour

• Warehousing provides time and place utility for
  raw materials, industrial goods, and finished
  products, allowing firms to use customer service
  as a dynamic value-adding competitive tool.
THE ROLE OF THE WAREHOUSE IN
     THE LOGISTICS SYSTEM
• The warehouse is where the supply chain holds
  or stores goods.
• Functions of warehousing include
  – Transportation consolidation
  – Product mixing
  – Docking
  – Service
  – Protection against contingencies
TYPE OF WAREHOUSING
• Public Warehousing

• Private Warehousing

• Contract Warehousing

• Multi-client Warehousing
DESIGN CONSIDERATION




Ideal Facility for Pure Supplier   Warehouse Space
Consolidation                      Requirements
(Full Pallet Movement)
PRINCIPLES OF WAREHOUSE
     LAYOUT DESIGN
RECEIVING
                 INP         •Schedule Carrier
                 UT          •Unload Vehicle
                             •Inspect for damage


                 WAREHOUSE PROCESS
                                                       Storage
         Put-away
                                             •Equipment
•Identify Product
                                             •Stock Location
•Identify Product Location
                                             –Popularity
•Move Products
                                             –Unit Size
•Update Records
                                             –Cube


  Shipping Preparation                              Order Picking
•Packing                                     •Information
•Labeling                                    •Walk & Pick
•Stacking                                    •Batch Picking


                                  Shipping
                       •Schedule Carrier
                       •Load Vehicle                   OUT
                       •Bill of Loading                PUT
                       •Record Update
OBJECTIVES OF EFFICIENT
      WAREHOUSE OPERATIONS
• Provide timely customer service.
• Keep track of items so they can be found readily &
  correctly.
• Minimize the total physical effort & thus the cost of
  moving goods into & out of storage.
• Provide communication links with customers
• Benefits of Warehouse Management
  – Provide a place to store & protect inventory
  – Reduce transportation costs
  – Improve customer service levels

• Complexity of warehouse operation depends on the
  number of SKUs handled & the number of orders
  received & filled.
• Most activity in a warehouse is material handling.
COSTS OF OPERATING A WAREHOUSE
 • Capital costs
   —Costs of space & materials handling
     equipment
 • Operating costs
   —Cost of labor
   —Measure of labor productivity is the number of
     units that an operator can move in a day
WAREHOUSE ACTIVITIES
• Receive goods

• Identify the goods

• Dispatch goods to
  storage
• Hold goods

• Pick goods

• Marshal shipment

• Dispatch shipment
Receive goods
   • Accepts goods from
   ‒ Outside transportation or attached factory &
     accepts responsibility
   • Check the goods against an order & the bill of
     loading
   • Check the quantities
   • Check for damage & fill out damage reports if
     necessary
   • Inspect goods if required
dentify the goods
    ‒ items are identified with the appropriate stock-
      keeping unit (SKU) number (part number) &
      the quantity received recorded

spatch goods to storage
    ‒ goods are sorted & put away


Hold goods
    ‒ goods are kept in storage & under proper
      protection until needed
Pick goods
     ‒ items required from stock must be selected
       from storage & brought to a marshalling area


Marshal the shipment
     ‒ goods making up a single order are brought
       together & checked for omissions or errors; order
       records are updated
ispatch the shipment
    ‒ orders are packaged, shipping documents are
      prepared, & goods loaded on the vehicle


erate an information system
    ‒ a record must be maintained for each item in
      stock showing the quantity on hand, quantity
      received, quantity issued, & location in the
      warehouse
Maximize productivity & minimize
cost, warehouse management must
work with the following
• Maximize use of space
  – space is the largest capital cost
• Effective use of labor & equipment
  – labor is the largest operating cost
  – material handling equipment is the second
    largest capital cost
FACTORS INFLUENCING
EFFECTIVE USE OF WAREHOUSES
• Cube utilization and accessibility
• Stock location
• Order picking and assembly
• Physical Control & Security - Elements
Cube utilization and
    accessibility
‒ Goods stored not just on the floor, but in the
  cubic space of the warehouse; warehouse
  capacity depends on how high goods can be
  stored
‒ Accessibility means being able to get at the
  goods wanted with a minimum amount of
  work
Cube utilization and accessibility
             continued…
Stock Location

  • Objectives
    – To provide the required customer
      service
    – To keep track of where items are stored
    – To minimize effort to receive, put away,
      and retrieve items
  • Basic Stock Locating Systems
    – Group functionally related items
      together
Stock Location
        continued…
• Fixed Location
  – SKU assigned a permanent location, & no other
    items are stored there
  – Fixed-location systems usually have poor cube
    utilization
  – Usually used in small warehouses; throughput is
    small, & there are few SKUs
• Floating (Random) Location
  – Goods stored wherever there is appropriate
    space
  – Advantage is improved cube utilization
Stock Location
    continued…

• Two other systems sometimes used are
 – Point-of-use storage
   • Inventory stored close to where it will be
     needed
   • Used in repetitive manufacturing & JIT
     systems
 – Central storage
   • Contains all inventory in one central
     location
Stock Location
     continued…

• Advantages of Point-of-use Storage

  – Materials are readily accessible to users

  – Material handling is reduced or eliminated

  – Central storage costs are reduced

  – Material is accessible all the time
Stock Location
     continued…

• Advantages of Central Storage

  – Ease of control

  – Inventory record accuracy is easier to
    maintain
  – Specialized storage can be used

  – Reduced safety stock, since users do not
    need to carry their own safety stock
Order Picking and
   Assembly
• When an order is received, items must
  be obtained from the warehouse,
  grouped, & prepared for shipment,
  systems used
  – Area system
  – Zone system
  – Multi-order system
Order Picking and
   Assembly continued…
• Area system

  – Order picker circulates throughout
    warehouse selecting items on an order --
    order is ready to ship when order picker is
    finished
• Zone system

  – Warehouse is divided into zones, & each
    picker works only in an assigned zone --
Order Picking and
   Assembly continued…
• Multi-order system

  – Same as the zone system, except that
    each picker collects items for a number of
    orders at the same time
PHYSICAL CONTROL & SECURITY -
          ELEMENTS
• Good part numbering system

• Simple, well-documented transaction system
  – Identify the item
  – Verify the quantity
  – Record the transaction
  – Physically execute the transaction

• Limited access
  – Inventory must be kept in a safe, secure
    (locked) place with limited general access
• Well-trained workforce
VIDEO




http://www.youtube.com/watch?v=Cbj2d_0w24E
Questio
ns ?
THANK
 YOU

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Warehousing management final copy

  • 1. WAREHOUSING MANAGEMENT Gaurav Narkhede | Josue Servalis | Mike Macas | Praneetha Boda
  • 2. • Part of firms logistics system that stores products at and between point of origin and point of consumption. • Term “Warehousing” is referred as transportation at zero miles per hour • Warehousing provides time and place utility for raw materials, industrial goods, and finished products, allowing firms to use customer service as a dynamic value-adding competitive tool.
  • 3. THE ROLE OF THE WAREHOUSE IN THE LOGISTICS SYSTEM • The warehouse is where the supply chain holds or stores goods. • Functions of warehousing include – Transportation consolidation – Product mixing – Docking – Service – Protection against contingencies
  • 4. TYPE OF WAREHOUSING • Public Warehousing • Private Warehousing • Contract Warehousing • Multi-client Warehousing
  • 5. DESIGN CONSIDERATION Ideal Facility for Pure Supplier Warehouse Space Consolidation Requirements (Full Pallet Movement)
  • 6. PRINCIPLES OF WAREHOUSE LAYOUT DESIGN
  • 7. RECEIVING INP •Schedule Carrier UT •Unload Vehicle •Inspect for damage WAREHOUSE PROCESS Storage Put-away •Equipment •Identify Product •Stock Location •Identify Product Location –Popularity •Move Products –Unit Size •Update Records –Cube Shipping Preparation Order Picking •Packing •Information •Labeling •Walk & Pick •Stacking •Batch Picking Shipping •Schedule Carrier •Load Vehicle OUT •Bill of Loading PUT •Record Update
  • 8. OBJECTIVES OF EFFICIENT WAREHOUSE OPERATIONS • Provide timely customer service. • Keep track of items so they can be found readily & correctly. • Minimize the total physical effort & thus the cost of moving goods into & out of storage. • Provide communication links with customers
  • 9. • Benefits of Warehouse Management – Provide a place to store & protect inventory – Reduce transportation costs – Improve customer service levels • Complexity of warehouse operation depends on the number of SKUs handled & the number of orders received & filled. • Most activity in a warehouse is material handling.
  • 10. COSTS OF OPERATING A WAREHOUSE • Capital costs —Costs of space & materials handling equipment • Operating costs —Cost of labor —Measure of labor productivity is the number of units that an operator can move in a day
  • 11. WAREHOUSE ACTIVITIES • Receive goods • Identify the goods • Dispatch goods to storage • Hold goods • Pick goods • Marshal shipment • Dispatch shipment
  • 12. Receive goods • Accepts goods from ‒ Outside transportation or attached factory & accepts responsibility • Check the goods against an order & the bill of loading • Check the quantities • Check for damage & fill out damage reports if necessary • Inspect goods if required
  • 13. dentify the goods ‒ items are identified with the appropriate stock- keeping unit (SKU) number (part number) & the quantity received recorded spatch goods to storage ‒ goods are sorted & put away Hold goods ‒ goods are kept in storage & under proper protection until needed
  • 14. Pick goods ‒ items required from stock must be selected from storage & brought to a marshalling area Marshal the shipment ‒ goods making up a single order are brought together & checked for omissions or errors; order records are updated
  • 15. ispatch the shipment ‒ orders are packaged, shipping documents are prepared, & goods loaded on the vehicle erate an information system ‒ a record must be maintained for each item in stock showing the quantity on hand, quantity received, quantity issued, & location in the warehouse
  • 16. Maximize productivity & minimize cost, warehouse management must work with the following • Maximize use of space – space is the largest capital cost • Effective use of labor & equipment – labor is the largest operating cost – material handling equipment is the second largest capital cost
  • 17. FACTORS INFLUENCING EFFECTIVE USE OF WAREHOUSES • Cube utilization and accessibility • Stock location • Order picking and assembly • Physical Control & Security - Elements
  • 18. Cube utilization and accessibility ‒ Goods stored not just on the floor, but in the cubic space of the warehouse; warehouse capacity depends on how high goods can be stored ‒ Accessibility means being able to get at the goods wanted with a minimum amount of work
  • 19. Cube utilization and accessibility continued…
  • 20. Stock Location • Objectives – To provide the required customer service – To keep track of where items are stored – To minimize effort to receive, put away, and retrieve items • Basic Stock Locating Systems – Group functionally related items together
  • 21. Stock Location continued… • Fixed Location – SKU assigned a permanent location, & no other items are stored there – Fixed-location systems usually have poor cube utilization – Usually used in small warehouses; throughput is small, & there are few SKUs • Floating (Random) Location – Goods stored wherever there is appropriate space – Advantage is improved cube utilization
  • 22. Stock Location continued… • Two other systems sometimes used are – Point-of-use storage • Inventory stored close to where it will be needed • Used in repetitive manufacturing & JIT systems – Central storage • Contains all inventory in one central location
  • 23. Stock Location continued… • Advantages of Point-of-use Storage – Materials are readily accessible to users – Material handling is reduced or eliminated – Central storage costs are reduced – Material is accessible all the time
  • 24. Stock Location continued… • Advantages of Central Storage – Ease of control – Inventory record accuracy is easier to maintain – Specialized storage can be used – Reduced safety stock, since users do not need to carry their own safety stock
  • 25. Order Picking and Assembly • When an order is received, items must be obtained from the warehouse, grouped, & prepared for shipment, systems used – Area system – Zone system – Multi-order system
  • 26. Order Picking and Assembly continued… • Area system – Order picker circulates throughout warehouse selecting items on an order -- order is ready to ship when order picker is finished • Zone system – Warehouse is divided into zones, & each picker works only in an assigned zone --
  • 27. Order Picking and Assembly continued… • Multi-order system – Same as the zone system, except that each picker collects items for a number of orders at the same time
  • 28. PHYSICAL CONTROL & SECURITY - ELEMENTS • Good part numbering system • Simple, well-documented transaction system – Identify the item – Verify the quantity – Record the transaction – Physically execute the transaction • Limited access – Inventory must be kept in a safe, secure (locked) place with limited general access • Well-trained workforce