WAREHOUSING AND STORAGE

 Warehousing and storage is an act of storing and assorting the finished

goods as to create maximum time utility at minimum cost.

 STORAGE involves proper management for preserving goods from the

time of their production till actual use.

 When the storage is done in on large scale , and in specified manner, it is

called WAREHOUSING

PURPOSE OF WAREHOUSING

 Special storage conditions such as climate control

 Target customer service level

 Lead times from suppliers and promise to customer

 Economies of scale

 Temporary storage for materials that needs to be disposed

DESIGNING INTERNAL WAREHOUSING OPERATION

7 principles of warehouse and distribution center design:

1. Determine the objective of the facility.

 This principle ranked at the top of the list.

The first step is to define the objectives and goals of the facility.

For example;

 Why will it exist?

 What market does it serve?

 Is it part of the network?

 What type of goods will be stored?

 What is the anticipated life of the facility?

 Will it be green field site or an existing facility?

2. Define the volume and functional requirements?

a) Quantities of products to be sold?
b) The through put velocities, including incoming goods, customer orders,
inter facility transfers, dispatches, and returns.
c) The nature of orders and specific picking requirements, e.g. is picking
performed in containers, pallets, cartons, inners, or single units?
d) What functions needed to be provided for?
3. Match storage modes, IT systems and mechanized technologies with
volumes.
 Designer is ready for equipment if the data has been analyzed. Be it static
racking equipment, mezzanines and the like, or mechanical equipment
such as conveyors and carousels. stacker cranes etc..
4. flow
 The skillful designers apply two immutable laws of flow.
a) One way flow - the flow is one way only. Whether straight,
clockwise, counterclockwise, up or down.
b) Flow versus capacity
-the second rule of flow is that free movement has priority over
storage capacity.

5. Close to zero material handling

 A simple rule that says it all: keep manual handling of products to

minimum – ideally no more than 3 to 5 touches while goods are in the
warehouse.

6. Evaluate your options

 The two common approaches to assessment are:

a. Quantitative analysis: return on investment, payback, cost per order
cubic meter to name just a few.
b. Qualitative analysis: ideally, the evaluation is better performed both
individually and in a team workshop environment.

7. Consult Widely as the Design Process is Multifaceted, Involving

Executives, Managers, Operators, Equipment Suppliers, Builders,
Architects, and Councils.

 As part of the development process, all should be regularly consulted

planning and legal matters. Operational needs preferences, ideas and
opinions.
WAREHOUSE DESIGN CONCEPTS

 Supply chain efficiencies depend up on the efficiency of logistics

including transportation and warehousing operations. Warehouse
efficiencies depend upon a combination of warehouse design, lay out,
infrastructure, systems and process and people.
 Warehouse design element aim to maximize the utility of space,
equipment, and efficiency of operations.
- A warehouse function consists of material receipts including
unloading unpacking and inspection.

Warehouse location, Lay out and

Building

 The location of a warehouse should ideally be situated on a flat ground.

The location should be easily approachable and in area suited for this
nature of business.

Internal layout

 Internal lay out design will be built taking into account the operational
process, nature of goods, volumes of transaction both inbound and
outbound.

Types of storage

 Determined by the nature of cargo. Depending upon the cargo whether

finished goods, raw material parts, etc., the types of storage can vary
from bulk stocks, racking, pallet racking, shelf racking, binning, unit pick
or loose pick face, carton pick etc.
Racking design and material handling equipment

 Takes into account the storage type, storage unit, volume, and weighted
couple with the available floor space and floor height to design system
that maximizes the storage capacity.

WAREHOUSING SAFETY AND SECURITY

Warehousing Operation

 Efficient and effective warehousing management can be tough task

 Workforce motivation can be difficult because the work can be:

- Repetitive in nature

- Strenuous and physically demanding

- On occasion dangerous

Important operational Issues

Warehousin Safety Hazardous

g
Consideratio Materials
Productivit ns
y

Warehousin Cleanliness
g security and
sanitation
Warehousing productivity analysis

 productivity is a measure of output/in

 Numerous productivity metrics can be used to assess warehouse
productivity, but not all are relevant to all facilities.

Examples of representative measures include:

1. Case shipped per person

2. Product lines shipped per person

3. Pallets shipped per person

4. Average warehouse capacity used

5. Forklift capacity used

6. Average warehouse capacity used

7. Forklift capacity used

8. Stock accuracy

Safety consideration

 Warehouse, distribution centers, and cross-docking facilities can be

dangerous workplaces

 facility rate in warehousing is higher

 Warehouse safety can by influenced by governmental regulations

 Standards have been set for warehousing equipment and operation and
are enforced by OSHA
 Warehouse safety categories include:

 Employee

 Property

 Motor vehicles

 Hazardous materials “hazmat”

 Explosives
 Flammable liquids
 Flammable solids

 Government regulations often require shipping documents indicating the

hazardous materials

 Government regulations require the use of safety data sheets (SDS)

Warehousing Security

 example potential threats include:

 Theft

 Pilferage

 Heat and humidity

 Vandalism

 Fire

 Loss electricity
Cleanliness and Sanitation Issues

 Particularly important in many industries, such the food service industry

 Can have a positive impact on employee safety, morale, and productivity
while also reducing employee turnover
 Requires common sense and due diligence

Safety Cues

 Visualization – using electronic boards provide workers and supervisor

critical information
 Information board is positioned through the materials handling and
assembly to alert employees or management of important information.
 Example: in a facility, employees work within assign area groups.
Each group select particular song that plays when the need arises to
alert employees and management of a problem. Experienced by the
work group. When the song is broadcast, everyone knows where in
the production process the problem lies.

Types of Cues

Visual Audio
Types of Types
Cues

Touch Types Odor

Of Cues Types

Of Cues
Types of Cues

 Visual Types of Cues

-Something than can see – seeing clearly within warehouse space
Example:

Fluid on the floor or indicate mechanical issue with the forklift,

leaking packaging may cause contamination of other products.

 Audio Types of Cues

- Something that we can hear – hearing clearly within warehouse space

Example:

Loud machinery could signal a mechanical issue may indicate an

emergency, horns indicates presence of other vehicle

 Odor Types of Cues

- Something smell of unfamiliar odors – smelling of unfamiliar odor
within warehouse space
Example:

Smoke or gas that indicates of explosive or fire hazards.

Safe Picking and Replenishment

1. Divided location according to activity (picking and replenishment).

2. Creating a reserve picking process – help warehouse operators to position

inventory and workers in a particular are only.
 3. Filling orders and loading trailers which an active area is located near the
shipping dock to facilitates the efficient movement of products for
shipping.

4. Replenishments operators should be the only product handlers moving

product from reserve area to packing area.

5. Training specific operators to perform one activity may help to maintain

safety workers and products.

6. Become familiar with product location and their sensory cues should
increase when something goes wrong.

Securing the Product

1. Warehouse environment bring together people, product and machinery an

due to this it is critical to understand the factor impacting the safety and
security of product within the workplace

2. As a warehouse operators, need to securer production from:

 Pilferage and Theft

 Damage
 Fire and Water
 Infestation

Physical Security Measures

1. Safety and security of product and personnel often requires separations

through physical means
 2. Physical security measures includes but not limited to:

a. Gate/ fenced to isolate between imported goods with other goods

b. Automatic opening and close doorways

What is Material Handling?

 Materials handling refers to the movement of materials from the store room
to the machine and from one machine to the next machine or work station
during the process of manufacture.

Function of Material Handling:

Following are the important functions of material handling:

i. Minimize material handling requirements, i.e., to select most efficient,

safe and appropriate materials handling equipment, which can fulfill
material handling requirement at minimum cost.

ii. To minimize the material handling cost by way of:

 Minimization of movement of semi-finished items during the

production process.
 Minimization of distanced moved.
 Increasing speed of material handling operation through
mechanization.
 By elimination/minimization of back tracking and duplicate
handling
 By utilization of gravity for material handling
Objectives of Material Handling

The main objective of the efficient material handling is to decrease the cost.

1. Cost Reduction

2. Waste Reduction

3. Improved Productivity

4. Improved Working Conditions

Principles of Material Handling

Material handling principles are as follows:

 Planning Principle: all material handling should be the result of a

deliberate plan where the needs, performance objectives and
functional specification of the proposed methods are completely
defined at the outset.
 Standardization Principle: Materials handling methods, equipment,
controls and software should be standardized within the limits of
achieving overall performance objectives and without sacrificing
needed flexibility, modularity, and throughput.
 Work Principle: Material handling work should be minimized
without sacrificing productivity or the level of service required of the
operation.
 Ergonomic Principle: Human capabilities and limitations must be
recognized and respected in the design of material handling task and
equipment to ensure safe and effective operations.
  Unit Load: unit load shall be appropriately sized and configured in a
way which achieves the material flow and inventory objectives at each
stage in the supply chain
 Space Utilization: effective and efficient use must be made of all
available space
 System Principle: Material movement and storage activities should
be fully integrated to form a coordinated, operational system which
spans receiving, inspection, storage, production, assembly, packaging,
unitizing, order selection, shipping, transportation and the handling
returns.
 Automation Principle: Material handling operations should be
mechanized and/or automated where feasible to improved operational
efficiency, increase responsiveness, improve consistency and
predictability, decrease operating cost and to eliminate repetitive or
potentially unsafe manual labor.
 Environmental Principle: Environmental impact and energy
consumption should be considered as criteria when designing or
selecting alternative equipment and material handling equipment.
 Life Cycle Cost Principle: A through economic analysis should
account for the entire life cycle of all material handling equipment and
resulting systems.

CONTAINERIZAATION, UNITIZATION AND PALLETIZATION

TECHNIQUES

CONTAINERIZATION

 Containerization is a systematic storage by using standards that are

standardized by the International Standardization Organization.
Origin of Containerization

 Although having its origins in the late 1780

 innovation in 20th century logistics
 Malcom Purcell McLean (November 14, 1913- May 25, 2001) was an
American entrepreneur, often called “the farther of containerization”.
 In 1956 he developed the metal shipping container, which replaced the
traditional break-bulk method of handling dry goods and revolutionized
the transport of goods and cargo worldwide.

Container

 A container is any receptacle or enclosure for holding a product used in

storage, packaging, and shipping, things kept inside of container are
protected by being inside of its structure.

Containerization Techniques:

 Containerization is an OS-level virtualization method used to deploy and

run distributed applications. Without launching an entire virtual machine.
(VM) for each app. Multiple isolated applications or services run a single
host and access the same OS kernel.

Palletization

 Refers to the process of placing goods or materials, either packaged or bulk,

onto pallets. The pallet provides a base for the goods and materials, thereby
promoting the efficient storage
Palletization techniques:

 Effectively shrink Shrink wrapping- yes we all do it and we all know what it
is. But so many shippers are shrinking wrapping their cargo ineffectively
and putting themselves at danger for damage cargo and expensive, time-
consuming claims processes.

 Vibration damage avoidance – vibration refers to shaking, mild or harsh, the

cargo will experience in transit due to mechanical handling.

 Bracing and protecting - we’ve written articles in the past on blocking and
bracing cargo as it pertains to cargo at it pertains to cargo within a shipping
container.

Unitization

 It is the process of consolidation of several units into single unit. It is made

of number of items or a bulky material and is constrained to lifted and
shifted because it too bulky to be moves manually material handling cost
decreases as the size of the unit increase.

Unitization Techniques:

 Is an efficient means of packaging, arranging and transporting products into

an appropriate unit for easy handling by materials handling equipment? This
not only contributes to the effective utilization of storage space, but also
others optimal stability for items such as lumber, bagged products and case
goods.
Stocktaking and Reporting

 Is a process of calculating the amount of stock .you having (including

food, drink, equipment etc?)
 Your reports tell you the quantity of stock you have the value of it and let
you compare it against your previous inventories.

Types of Stocktaking

 Opening stocktaking: It takes place at the founding of a company, and shows

the assets and liabilities.

 Mid-year, Year-end Stocktaking: It supports the balance sheet of a company

it shows the quantity (value, condition) of the assets that the company has on
the balance sheet date, or just a part of it (part stocktaking).

 Full Stocktaking: It shows all assets and liabilities of a company on a given

date, including the ones not present at an owned site, but at a remote
location.

 Part Stocktaking: It covers an entire section of a tie of an assets or liability.

We consider as part stocktaking when a single site, warehouse or zone is
taken as well.

 Handover Stocktaking: It is done when the person responsible for an area

changes. The previous person responsible passes the assets the new one.

 Foreign Stocktaking: It counts the items in foreign ownership, but in the

possession of the company. Most common examples are semi-finished
goods passed over for processing, items given on consignment or guard.
  Statement of Storage: Items in the ownership of the company but at another
site, in the put possession of another party can be counted by them and the
results of that stocktaking becomes the statement of storage.

 Stocktaking Declaring Assets: The full extent of the properties of a company

is the part of this stocktaking, current and fixed assets (goods, buildings,
machines, balance etc.) It is obligatory in each year, as of 31st December.

 Exceptional Stocktaking: The date of stocktaking is not known for the unit
to be inspected (warehouse, store). It is recommended in case of suspected
abuse, sales of items of great value or without invoice.

Crucial Information about Business

 Determines how well your business is operating

 Confirms your gross profit

 Pinpoints if you have any stock problems i.e. theft

 Aids you with your pricing strategy

 Provides and accurate account of the stock you hold

 Highlights specific good and bad product sales performance

 Identify how to reduce stock levels and improve cash flow

Techniques of Stocktaking

1. Periodic Stock Count: Can be monthly, quarterly or half yearly, checking of

the entire stock over one or two days dependent on the amount of stock

2. Continuous, Perpetual Stock Count: With this system stocktaking is done

throughout the year as per a predetermined plan of action.

3. Pick Accuracy: Involves checks that a business makes at the time of

receiving stock from suppliers and/or while issuing items to store/customer.

4. Stock out Validation: This method of stores stock validation is completed

when a particular item is out of stock or levels of stock are very low.

5. Annual Stocktaking: When periodical stocktaking or continuous stock

validation is not undertaken then an annual stock take is essential. Annual
stocktaking is completed once a year.

6. The Importance of stocktaking is clear. It allows you to regularly monitor

and increase gross profit, reduce loss improve control of allowances, and
reduce waste.