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Warehousing

What is a warehouse?
a place to store inventory a switching facility - bridge the time gap between the production and demand

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Why Warehouses?
To achieve economies in Transportation To Meet changing Market Conditions Obtain Quantity Purchase Discounts

Benefits of Warehousing
Economic Benefits Consolidation Break Bulk Cross Dock Processing/Postpon ement Stockpiling Service Benefits Spot Stock
Narrrow product line, large number of small WH, limited time period

Assortment
Broad product line, few locations functional year round

Mixing Production Support

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Warehousing Strategy
An integrated warehouse strategy focuses on two questions. The first concerns how many warehouses should be employed. The second question concerns which warehouse types should be used to meet market requirements.

The Number of Warehouses

Factors Affecting the Number of Warehouses
Inventory costs Warehousing costs Transportation costs Cost of lost sales

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Site Selection
Location analysis techniques are available to assist in selecting a general area for warehouse location Centre of Gravity Method. Once location analysis is completed, a specific building site must be selected. The primary factors in site selection are the availability of services and cost.

ASIAN PAINTS Plant Location

Kasna Ankleshwar

Bhandup Patancheru

4 Plant Locations
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RDC Location
RDC North Ghaziabad

RDC Abad

RDC Central Raipur

RDC Mumbai

RDC Hyderabad

RDC South Bangalore

RDC Locations
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Jammu Bhatinda Jallandar Zirakpur Ludhiana Agra Jodhpur Indore Rajkot Udhaipur Surat Parwanoo Fbad

Physical Linkage Field Unit Location

Saharanpur Lucknow Varanasi Patna Ranchi Sliguri

Ghaziabad Kanpur

Agartala Guwahati

Gwalior Raipur RDC Nagpur

Bhandup
Kolhapur

Curttack Akola Vijayawada Vizag Hubli Secunderabad Mysore Tirupati Cuddalore Salem Coimbatore Trichy

Mangalore Calicut Trivandrum

Depot Locations
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Madurai

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Warehouse Operating Principles

Once it has been determined to use a warehouse, the next step is designing it. Whether the warehouse is a small manual operation or a large automated facility, the following three principles are relevant:
Design criteria, Handling technology, and Storage plan.

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A Sample Storage Area

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Warehouse Types
Warehouse alternatives include:
(1) Private warehouses, (2) Public warehouses, and (3) Contract warehouses

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Private Warehouses
A private warehouse facility is owned and managed by the same enterprise that owns the merchandise handled and stored at the facility. The major benefits of private warehousing include control, operational flexibility and other intangible benefits.

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Public Warehouses
An independent business offering a range of services -such as storage & handling on the basis of a fee Generally offer standardized services. On the basis of the range of operations performed, public warehouses are classified as (1) general merchandise, (2) refrigerated, (3) special commodity, (4) bonded, and (5) household goods and furniture.
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Contract Warehouses
Contract warehousing combines the best characteristics of both private and public operations. Specialised / Customised Service The long-term relationship and shared risk result in lower cost than typical public warehouse arrangements. Contract warehouse operations can provide benefits of expertise, flexibility, and economies of scale by sharing management, labor, equipment, and information resource.
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Qualitative Decision Factors

Presence synergy and Operating flexibility is higher in Private Warehouses. Other factors are higher in Public Warehouses.
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3PL
Transportation Handling Storage Inventory control Order processing Customer service / High Responsiveness

Heard of 4PL?
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Elements of Warehouse Design

Land and Building Management and Staff Storage & Handling Equipment Computers & Software Operating Methods & Procedures Productivity Metrics?

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Order Picking
On receipt of an order, the warehouse must:
Verify product is in inventory Produce pick-lists to guide order picking Think of a pick-list as a shopping list that list the SKUs to be picked, the quantity to be picked and their locations Produce any necessary shipping documentation Schedule the order picking operations

These are typically handled by a Warehouse Management System (WMS)

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Core functions of WMS

Receiving Cycle-count Pick Task Management Quality Analysis Replenishment Pack Opportunistic cross dock Inventory Control Ship

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WMS tools
Barcode scanners Mobile computers RFID

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