1 Warehouse Management Overview from from The Systems House, Inc.

2 Benefits of MDS-WMS Inventory is the single largest investment made by the distributor Inventory is the single largest investment made by the distributor Improve inventory accuracy Improve inventory accuracy Improve order processing accuracy (less returns) Improve order processing accuracy (less returns) Improve personnel performance and accuracy Improve personnel performance and accuracy Better utilize warehouse space Better utilize warehouse space Improve customer satisfaction Improve customer satisfaction

3 The MDS Warehouse Management Solution Warehouse Design Warehouse Design Single or Multiple Warehouses Single or Multiple Warehouses Branches or Stock Rooms Branches or Stock Rooms Location Management in Warehouse Location Management in Warehouse Location as a Reference or Location as a Reference or Inventory by Location (Random Locator System) Inventory by Location (Random Locator System) Receive, Stock, and Sell in Multiple Units of Measure Receive, Stock, and Sell in Multiple Units of Measure Solid Case and Quick Pick Areas (Low Unit) Solid Case and Quick Pick Areas (Low Unit) Primary and Backup Locations Primary and Backup Locations Low Unit vs. Bulk Picking Low Unit vs. Bulk Picking Low Unit replenishment Low Unit replenishment Environmental and Security Considerations Environmental and Security Considerations Lot#, Serial#, Expiration Date Control Lot#, Serial#, Expiration Date Control

4 MDS Warehouse Capabilities Warehouse Management Functions (WMS ) Warehouse Management Functions (WMS ) Receiving Receiving Put Away Put Away Replenishment (location management) Replenishment (location management) Picking Picking Physical Inventory / Movements / Adjustments Physical Inventory / Movements / Adjustments Returns from Customers and to Vendors Returns from Customers and to Vendors Interface to UPS and FedEx Interface to UPS and FedEx Delivery Route Management Delivery Route Management Manifest System Manifest System Proof of Delivery (Signature capture) Proof of Delivery (Signature capture) Package Tracking with Multiple Stops Package Tracking with Multiple Stops

5 Advanced Capabilities Implement Bar Coding to Improve Accuracy Implement Bar Coding to Improve Accuracy Not necessarily faster Not necessarily faster Bar Coding Issues Bar Coding Issues Product or Location Bar Coding Product or Location Bar Coding Manufacturer Can Label Products: Manufacturer Can Label Products: Not uniform in many industries such as Medical Significant Cost to Barcode Items Upon Receipt Significant Cost to Barcode Items Upon Receipt Bar Codes do not Define Unit of Measure Bar Codes do not Define Unit of Measure Alternate Solution: Barcode Locations Alternate Solution: Barcode Locations Maintain Product by Location (one item per location) Maintain Product by Location (one item per location) Wireless Solutions Wireless Solutions Wi-Fi or RF Receiving, Replenishment, and Picking Wi-Fi or RF Receiving, Replenishment, and Picking Automated Picking - Carousel Systems Automated Picking - Carousel Systems Voice Response Picking Voice Response Picking

6 WiFi Equipment Schematic MDS WMS Server Wireless PickingWireless Receiving Wireless Inventory And Replenishment

7 WiFi PDT Handheld/ Equipment

8 Warehouse Management Menu

9 Warehouse Setup

10 Warehouse Level Parameters Location Control in use Location Control in use Wireless Picking in use Wireless Picking in use Bulk Redirection Bulk Redirection Receiving Method Receiving Method IM Replenishment Method IM Replenishment Method Single Product per location Single Product per location Replenishment Method (Min/Max or to Max) Replenishment Method (Min/Max or to Max) Remove Location Flag (upon depletion) Remove Location Flag (upon depletion) Replenish Case Rounding Replenish Case Rounding Redirect if not in Bulk Redirect if not in Bulk OE Replenish to Max OE Replenish to Max Wireless Receipts Wireless Receipts Location Format Location Format Location Match Location Match

11 Location Control and Setup

12 Product Master File

13 Inventory and Product Information

14 Lot Inventory Display

15 Lot and Serial Number Tracking Inquiry

16 Receiving Receiving Form Printed (by Vendor and Purchase Order) Receiving Form Printed (by Vendor and Purchase Order) Inspect and Approve Receipt Inspect and Approve Receipt Receipt and Put Away Information Recorded on Receiving Form Receipt and Put Away Information Recorded on Receiving Form Form shows current locations Form shows current locations Placement of inventory determined by warehouse personnel Placement of inventory determined by warehouse personnel Generate Bar Coded Labels at Receiving (Optional) Generate Bar Coded Labels at Receiving (Optional) Product Labels Product Labels Lot#, expiration date, weight Lot#, expiration date, weight Inventory Receipt Info Entered into MDS System from Receiving Form Inventory Receipt Info Entered into MDS System from Receiving Form Can be entered in warehouse or office Can be entered in warehouse or office

17 Receiving Form

18 Label Creation Software

19 Receiving and Put Away Using RF Recall Purchase Order(s) to PDT Recall Purchase Order(s) to PDT Inspect and Approve Receipt Inspect and Approve Receipt Paperless Receiving Using Portable Data Terminals (PDTs) Paperless Receiving Using Portable Data Terminals (PDTs) Receive to “Receiving Location” (Staging Area) Receive to “Receiving Location” (Staging Area) Generate Bar Coded Labels at Receiving (Optional) Generate Bar Coded Labels at Receiving (Optional) Product Labels Product Labels Lot#, expiration date, weight Lot#, expiration date, weight Pallet Labels Pallet Labels Put Away Merchandise and Record Bin Locations using PDT based on: Put Away Merchandise and Record Bin Locations using PDT based on: Available space in primary location Available space in primary location Existing backup location Existing backup location Additional backup location Additional backup location Cross-Docking of Backorders Cross-Docking of Backorders Environmental Requirements (hazardous, security) Environmental Requirements (hazardous, security) Weight Requirements (i.e. on ground only) Weight Requirements (i.e. on ground only)

20 Put Away Function  Receive to “Receiving Location”  Cross Dock Orders  Receive to Bulk Location  Receive to Primary Pick Location

21 Replenishment Process Stock Falls Below Below Minimum Levels Transfer Request is Automatically Generated Generated Transfer is Picked and is Picked and Verified by Barcode(Item/Location) 1.Used if inventory by location has been implemented 2.Daily and Just in Time Replenishment Daily – Restock all primary pick locations up to pre-determined level (i.e. 3 days supplies)Daily – Restock all primary pick locations up to pre-determined level (i.e. 3 days supplies) During day – replenish locations falling below minimumDuring day – replenish locations falling below minimum 3.Transfer request generated on paper or electronically 4.Transfers verified by barcode (Item or Location)

22 Replenishment Report

23 Replenishment Transfer ID is scanned. Transfer ID is scanned. On the replenishment picking, each “from” location is scanned. On the replenishment picking, each “from” location is scanned. On the replenishment put-away, each “to” location is scanned. On the replenishment put-away, each “to” location is scanned. After scanning the “to” location, the product is moved in the system to the new location and an inventory audit is created. After scanning the “to” location, the product is moved in the system to the new location and an inventory audit is created.

24 Picking Items can be stored in multiple locations. Selection based on: Items can be stored in multiple locations. Selection based on: Earliest expiration date Earliest expiration date Oldest merchandise (receipt date) Oldest merchandise (receipt date) Solid case vs low unit of Measure Solid case vs low unit of Measure Orders can be grouped for “batch picking” Orders can be grouped for “batch picking” Replenishment if in use, must precede print Replenishment if in use, must precede print MDS splits each order into picking zones: MDS splits each order into picking zones: Bulk Area (solid cases) Bulk Area (solid cases) Low Unit Picks Low Unit Picks Pick Tickets can print upon entry or batched by time Interval Pick Tickets can print upon entry or batched by time Interval Pick Tickets typically print in pick location sequence Pick Tickets typically print in pick location sequence Picker picks items and notes discrepancies on the pick ticket Picker picks items and notes discrepancies on the pick ticket Order is verified to the system Order is verified to the system Packing Slip Printed Packing Slip Printed Shipping process initiated with interface to UPS or FedEx Shipping process initiated with interface to UPS or FedEx Invoice Printed in-line or overnight Invoice Printed in-line or overnight WiFi

25 Picking Summary

26 Picking Ticket

27 Packing Slip

28 Invoice

29 Picking using RF Customer order scheduling based on priority, shipping schedule and personnel availability Customer order scheduling based on priority, shipping schedule and personnel availability Items can be stored in multiple locations. Selection based on: Items can be stored in multiple locations. Selection based on: Earliest expiration date Earliest expiration date Oldest merchandise (receipt date) Oldest merchandise (receipt date) Solid case vs low unit of Measure Solid case vs low unit of Measure Replenishment if in use, must precede print Replenishment if in use, must precede print MDS splits each order into picking zones: MDS splits each order into picking zones: Bulk Area (solid cases) Bulk Area (solid cases) Low Unit Picks Low Unit Picks Carousel Carousel Pick to Light Flow Rack (PTL) Pick to Light Flow Rack (PTL) Voice Response Voice Response Orders can be grouped for “batch picking” Orders can be grouped for “batch picking” Warehouse manager assigns orders to pickers Warehouse manager assigns orders to pickers Picker obtains next assigned order from PDT Picker obtains next assigned order from PDT Display in pick sequence – picker can change sequence Display in pick sequence – picker can change sequence Picker verifies picked items and quantities by barcode (Item or Location) Picker verifies picked items and quantities by barcode (Item or Location) Discrepancies noted for review and correction Discrepancies noted for review and correction Order is verified to the system Order is verified to the system Shipping process initiated Shipping process initiated WiFi

30 Picking Ticket Assignment

31 Operator Logon

32 Wireless Menu Wireless Menu Customizable Menu by Operator

33 Picking Wireless Picking Using Scanners

34 Automated Material Handling Innovative technologies Innovative technologies Advanced software solutions Advanced software solutions Data collection and analysis Data collection and analysis Hardware Solutions: Hardware Solutions:  Horizontal carousels Horizontal carousels Horizontal carousels  Vertical carousels Vertical carousels Vertical carousels  Heavy-duty carousels Heavy-duty carousels Heavy-duty carousels  Vertical lift modules Vertical lift modules Vertical lift modules  Heavy-duty vertical lift modules Heavy-duty vertical lift modules Heavy-duty vertical lift modules  Storage and retrieval machines Storage and retrieval machines Storage and retrieval machines  Automatic inserter/extractors Automatic inserter/extractors Automatic inserter/extractors  Pallet conveyor Pallet conveyor Pallet conveyor  Tote/case conveyor Tote/case conveyor Tote/case conveyor  Sortation systems Sortation systems Sortation systems  Light-directed picking Light-directed picking Light-directed picking  Voice-directed picking Voice-directed picking Voice-directed picking  Wireless picking Wireless picking Wireless picking  Specialty products Specialty products Specialty products

35 MDS – WMS Server MDS-WMS for Medical Distribution Receiving Put-away Solid Case Picking Replenishment Transfer/Cycle Count Diamond MHS Interface Order Consolidation Print documents/labels Reporting Order Tracking Optional Modules Diamo n dWare AutoRoute Server MDS-WMS Interface DirectPick PTL flow rack/shelving Picking Zone Management Reporting PowerPick PTL carousel pods Batch Picking Replenishment Reporting AutoRoute Tote Routing Conveyor Logic Software Information Flow

36 Carousel And Conveyors

37 Carousel System Automated Storage and Retrieval System for High Speed Order Picking Automated Storage and Retrieval System for High Speed Order Picking The PowerPick software works seamlessly in conjunction with the MDS software The PowerPick software works seamlessly in conjunction with the MDS software Saves time while increasing productivity, can improve order picking productivity by as much as 600 percent Saves time while increasing productivity, can improve order picking productivity by as much as 600 percent Improves order accuracy and inventory control Improves order accuracy and inventory control Reduces labor costs Reduces labor costs Saves space Saves space

38 Order Consolidation Totes can have fixed Tote ID’s, or the Tote number can be assigned and a tote label prepared by MDS at the carousel or PTL system. Totes can have fixed Tote ID’s, or the Tote number can be assigned and a tote label prepared by MDS at the carousel or PTL system. DiamondPick uploads all tote numbers used for an order. DiamondPick uploads all tote numbers used for an order. MDS prints labels for the solid case picks with order number and product bar codes. MDS prints labels for the solid case picks with order number and product bar codes. At consolidation station tote bar codes and solid case labels are scanned: At consolidation station tote bar codes and solid case labels are scanned: Confirm entire order has been picked Confirm entire order has been picked Print shipping labels Print shipping labels Print packing slip(s) by tote. Print packing slip(s) by tote. WiFi

39 Labor Statistics Labor tracking by picker Labor tracking by picker Number of Lines/Hour/Day/Month Number of Lines/Hour/Day/Month Number of Orders/Hour/Day/Month Number of Orders/Hour/Day/Month Dollar Value Dollar Value Qty of Items picked Qty of Items picked Time to Pick Time to Pick Average Lines/Orders Average Lines/Orders WiFi

40 Picker Statistics Report - Summary

41 Picker Statistics Report - Detail

42 Warehouse Procedures Other Procedures Other Procedures Cycle Counts Cycle Counts Physical Inventory Physical Inventory Inventory Adjustments Inventory Adjustments Transfers Transfers Customer Returns Customer Returns Return to Vendor Return to Vendor

43 Physical Inventory

44 Physical Inventory Scan tag, location or product and enter counts.

45 Inventory Movements and Adjustments

46 Inventory Transaction Tracking

47 Reporting

48 Benefits of MDS-WMS Benefits of MDS-WMS Improved inventory accuracy Improved inventory accuracy Improve personnel performance and accuracy Improve personnel performance and accuracy Determine time to pick by individual Determine time to pick by individual Better utilization of warehouse space Better utilization of warehouse space More flexible scheduling More flexible scheduling