2 Meaning of Warehousing A warehouse is a structure where goods are storedWarehousing is one of activities in supply chain managementWarehousing is a procedure or a process of storing goods within a storage facilityWarehousing involves administrative and physical functions associated with storing
3 Warehousing as an Integrating function In supply chain integration, warehousing plays a critical roleWarehousing initiatives directed towards minimising pipeline inventoryPressure points in warehousing include – accuracy and cycle time performance.Cycle time refers to the period required to complete one cycle of an operationWhat would the cycle time be in the context of warehousing?
4 Roles of Warehouses in Warehousing TYPES OF WAREHOUSESRaw material & Components WarehouseWork-In-Progress WarehouseFinished Goods WarehouseDistribution WarehouseFulfilment WarehouseLocal WarehouseAROUND A MANUFACTURING FACILITYAROUND A PRIMARY DISTRIBUTION DEPOTSupports DistributionSupports Production
5 Roles of Warehouses in Warehousing (Contd…) DISTRIBUTION CENTRERaw Material WarehouseHold raw materials at or near point of induction into manufacturing processFIRMHold and consolidate products from one or several firms for combined shipmentWIP WarehouseHold partially completed assemblies and products at various points along an assembly/production lineFulfilment WarehouseLocal WarehouseReceive, pick and ship small orders for individual customersDistributed in the field in order to shorten transportation distances to permit rapid response to customer demandFinished goods WarehouseHold inventory used to balance and buffer the variation between production schedules and demand
6 Need for Warehousing Seasonal Production Commodities like agricultural produce are harvested at a particular time periodCommodities associated with festivitiesSeasonal DemandCommodities like woollen garments during winters and umbrellas during rainy seasonLarge-scale ProductionMore economical form of production for certain commoditiesQuick SupplyBoth industrial and agricultural products are produced at some specific places but consumed throughout the countryContinuous ProductionContinuous production requires adequate supply of raw materialsPrice StabilizationTo maintain a reasonable level of the price of the goods in the market there is a need to keep sufficient stock in warehouses
7 Functions of Warehousing ReceivingOrderly receipt of all materials coming into warehouseProviding assurance that the quantity and quality of such materials are as orderedPrepackagingWhen products are received in bulk from supplier and subsequently packaged in merchandisable quantities or combinations with other parts to form kits or assortmentsPutawayAct of placing merchandise in storageIncludes material handling, location, verification and product placementStoragePhysical containment of merchandise while it is awaiting demandStorage method depends on its size, quantity of items in inventory and handling characteristics of the product or container
8 Functions of Warehousing (Contd…) Order pickingA basic service provided in a warehouseProcess of removing items from storage to meet specific demandPackaging and/or pricingOptional step after pickingIndividual items may be available for salePricing is current at the time of salePrepricing at manufacture or receipt in warehouse inevitably leads to repricing activity as price lists are changed while merchandise sits in inventorySortationThis activity is undertaken when an order has more than one item and accumulation is not done in picksSorting batch picks into individual orders and accumulation of distributed packs into orders
9 Functions of Warehousing (Contd…) Unitising and shippingChecking orders for completenessPackaging merchandise in appropriate shipping containersPreparing shipping documents, including packing lists, address labels and bills of ladingWeighing shipments to determine shipping chargesAccumulating orders by outbound carriersLoading trucks (mostly carrier’s responsibility)