Warehouse Mgmt

8/14/2019 Warehouse Mgmt

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PRESENTED BY:

Abhradeep PaulMBA(Agribusiness)

Final year


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Title

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OVERVIEW:

A warehouse is typically viewed as a place to storeinventory.

However, in many logistical system designs, the role of the

warehouse is more properly viewed as a switching facility ascontrasted to a storage facility.

Storage management is meant for minimizing deterioration

and spoilage. It is a common practice particularly when

dealing with materials that tend to deteriorate or obsolete, toissue old material ahead of new material.


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RECEIVING OF MATERIALS:Receiving is essentially a clerical operation. Because man clerical activities are

regarded as Routine, however, the importance of the receiving function often isunderrated.

Most problems or error in a purchasing transaction should come to light during

receiving operation. If the problem is not detected and corrected during the

receiving operation the cost to correct the mistake later is always higher.

RECEIVING PROCEDURE:A typical receiving procedure consists of four steps.

1. Unloading and checking the shipment.

2. Unpacking and inspecting the material.

3. Completion of the receiving report.

4. Deliver of the material


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IDENTIFICATION SYSTEM:In a broader sense there are two types of material identification system. These

are-

A. External Systems

The two most commonly used external systems are:

1)The Harmonized Commodity Description and Coding system>It provides a set ofdescriptions and six digit codes for commodity identification, description and

reporting. It also contains an option for the addition of 4 more digits to provide

more local detail.

2) The Export Commodity Control Numbers System> Consists of product numbers

that take the form of five character alphanumeric code. The system is used

primarily for security sensitive materials requiring export control.


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B. Internal system:

Most firms follow some type of symbolic approach in designing the

system. Symbolic systems can be either numerical or mnemonic.

The numerical system typically assigns a 6-10 digit code

number to each item. The following example illustrates the

concept:

2 137 019 508

General Generic Subclass Specific item

Class Class number


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Different Types of Storage Systems:

A. Closed System>

In this system all materials are stored in a closed or controlled area.

Whenever possible, the general practice is to maintain physical control by

locking the storage area.

Material enters and leaves the area only with the accompaniment of an

authotized document. The system is designed to afford maximum physical security and to

ensure tight accounting control of inventory material.

B. Open System>

Storage facilities are completely open, and any worker has access to anstorage facility.

In plant using this system, no storerooms as such exists; each material is

stored as close to its point of use as is physically possible.

It place less emphasis on the physical security of materials.


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Materials are stored in bins, on shelves, in racks, on pallets, in tote boxes, and

so on.

It also place less emphasis on the accounting control of materials. Materials

are usually put into production without the use of requisition or a controldocument.

Materials used in this system should not be subject to pilferage, nor should the

be easily damaged.

No perpetual inventory records are kept in an open system. To determine the

actual usage of a material during a given period , it is necessary to take aphysical count of the material at the end of the period and compare this figure

with the similar beginning-period figure , adjusted for material receipts during the

period. Hence accounting charges are determined indirectly rather than directly.

It is most applicable in situation where a repetitive production operation

produces standardized products.This system is most likely to function successfully if it is not applied to a large

no. of items.


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C. Random-Access Storage System>

It is a unique type of closed stores systems, used by a relatively small no. of

large firms.

In this system no material has a fixed storage location. When an item enters the

storeroom, it is stored in the first available bin or shelf suitable for its storage

requirement. When the item is withdrawn from the stores, the storage space is

available for an other incoming item having similar physical storage requirements.

All materials thus stored at random locations throughout the warehouse.

Disadvantage

Tight physical control of materials may be more difficult to achieve. Stores clerks seldom

become familiar with the total stock of any item, simply because they lose the close visualcontact they have with the materials in a conventional system.

Advantage The system provides great flexibility. The same storage facilities can easilyaccommodate different materials, shifts in inventory mix and an unexpected increase in the

stock level of an existing material.


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D. Automated Storage/ Retrieval system(AS/RS)>

A combination of the random access storage concept, highly sophisticatedstorage/retrieval machines, and a computerized control system has produced this

system.

The storage facility frequently is a 30-80 ft high rise structure constructed of open

steel columns. Typically it is configured into storage cubicles of different sizes andutilizes various types of standardized pallets and containers for storage.

A no. of warehouse stock clerks are replaced with automated storage/retrieval

machines that are mounted on captive floor rails or on conventional wheels.

The tall vehicles normally controlled by computer have a lifting platform with a

shuttle that stores and retrieves palletized loads on both sides.


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Warehouse Design Criteria :Warehouse design criteria address physical facility characteristics and product

movement.

Three factors to be considered in the design process are:

(1)the number of stories in the facility,

(2)height utilization, and

(3)product flow.

Number of stories in the facility:

The ideal warehouse design is limited to a single story so that product does nothave to be moved up and down.

The use of elevators to move product from one floor to the next requires time

and energy.

The elevator is also often a bottleneck in product flow since many material

handlers are usually competing for a limited number of elevators.


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Height utilization:

Regardless of facility size, the design should maximize the usage of the available

cubic space by allowing for the greatest use of height on each floor.Most warehouses have 20- to 30-foot ceilings (1 foot = 12 inch; 1 inch =

2.54 cm), although modern automated and high-rise facilities can effectively use

ceiling heights up to 100 feet.Through the use of racking or other hardware, it should be possible to store

products up to the building's ceiling.Maximum effective warehouse height is limited by the safe lifting capabilities of

material-handling equipment, such as forklifts.

Product flow:

Warehouse design should also allow for straight product flow through the facilitywhether items are stored or not.

In general, this means that product should be received at one end of the building,

stored in the middle, and then shipped from the other end.

Straight-line product flow minimizes congestion and confusion.


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Storage Plan

A warehouse design should consider product characteristics, particularly

those pertaining to volume, weight, and storage.

Product volume is the major concern when defining a warehouse storage

plan.

High-volume sales or throughput product should be stored in a location that

minimizes the distance it is moved, such as near primary aisles and in low

storage racks.

Such a location minimizes travel distance and the need for extended lifting.

Conversely, low-volume product can be assigned locations that are distant

from primary aisles or higher up in storage racks.


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A Sample Storage Area


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Storage Plan

Similarly, the plan should include a specific strategy for products

dependent on weight and storage characteristics.

Relatively heavy items should be assigned to locations low to the

ground to minimize the effort and risk of heavy lifting.

Bulky or low-density products require extensive storage volume, so

open floor space or high-level racks can be used for them.

On the other hand, smaller items may require storage shelves or

drawers.

The integrated storage plan must consider and address the specific

characteristics of each product.


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Five basic service benefits are achieved through warehousing:

1.Spot stockUnder spot stocking, a selected amount of a firm's product line is placed

or "spot stocked" in a warehouse to fill customer orders during a critical

marketing period.

In particular, manufacturers with limited or highly seasonal product lines

are partial to this service.

Utilizing warehouse facilities forstock spotting allows inventories to be

placed in a variety of markets adjacent to key customers just prior to a

maximum period of seasonal sales.

Suppliers of agricultural products to farmers often use spot stocking to

position their products closer to a service-sensitive market during the

growing season.

Service Benefits


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(2)Assortment>

An assortment warehouse stocks product combinations in

anticipation of customer orders.The assortments may represent multiple products from different

manufacturers or special assortments as specified by customers.In the first case, forexample, an athletic wholesaler would stock

products from a number ofclothing suppliers so that customers can be

offered assortments.

In the second case, the wholesaler would create a specific teamuniform including shirt, pants, and shoes.

(3)Mixing>

In a typical mixing situation, truckloads of products are shipped from

manufacturing plants to warehouses.Each large shipment enjoys the lowest possible transportation rate.Upon arrival at the mixing warehouse, factory shipments are unloaded

and the desired combination of each product for each customer or

market is selected.When plants are geographically separated, overall transportation

charges and warehouse requirements can be reduced by mixing.


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(4)Production Support>Production support warehousing provides a steady supply of components

and materials to assembly plants.

Safety stocks on items purchased from outside vendors may be justified

because of long lead times or significant variations in usage.

The operation of a production support warehouse is to supply or "feed"

processed materials, components, and subassemblies into the assembly

plant in an economic and timely manner.

(5)Market Presence>While a market presence benefit may not be so obvious, it is often cited by

marketing managers as a major advantage of local warehouses.

The market presence factor is based on the perception or belief that local

warehouses can be more responsive to customer needs and offer quicker

delivery than more distant warehouses.

As a result, it is also thought that a local warehouse will enhance market

share and potentially increase profitability.


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Documents

Warehouse Mgmt