142020 1 key Warehouse Processes ‘Logistics Bureau Home / Warehouse / Spotlight on: 7 Key Warehouse Processes Spotlight on: 7 Key Warehouse Processes Jul 25, 2018 | Warehouse | 34 comments [AREHOUSE TN } Line This article, written by Mal Walker, Manager at Logistics Bureau, was first published in the January / February 2018 issue of MHD Supply Chain Solutions. The 7 Key Warehouse Processes Are all warehouses the same? Short answer: no, but yes! This contradiction in terms is probably best explained by the Thai phrase; ‘Same, same, but ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! sie8142020 7 key Warehouse Processes different. This phrase is used widely in Thailand to explain to naive tourists (such as myself) the similarities between one product and another. Let me explain. Yes, warehouses are the same in 7 key aspects. They share 7 key processes. Two relate to inwards flow (yellow), three to outwards flow (green), plus returns and value adding. Same same! Now here is the ‘different’ part. There is a plethora of nuances in how each process is physically conducted and electronically controlled. For example, two competitors with the same products will often have different ways of doing things. Idiosyncrasies across industries adds further diversity. Even third-party logistics companies do things differently. The SCOR model and companies such as GS1 have blueprints of key processes using barcoding and radio frequency controls, which offer standard ways of reading and recording data, but the physical materials handling logistics and ways of doing things in each warehouse are somewhat unique to each business. This is driven by factors including magnitude of the warehouse operation, storage capacity, temperature, order profiles, legislative requirements, company culture, and volume of goods moving through the facility. So, what are they key processes and how are they handled? 1, Receiving The act of handling products into a warehouse and onto a system. Receipts may be for single products, objects, litres, cartons, packets, crates, kilograms or full pallets, tems maybe large such as pallets, or as small as a split pin, The best way to receive products is via an Advance Shipping Notice (ASN) from a supplier. With this information on system, operators can scan ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 2124‘2020 7 key Warehouse Processes consignment barcodes to bring up the ASN. If the delivery matches the ASN, then goods can be system-received. But at this point they are still at staging, albeit ready for put-away. Some systems allow for goods to be received into inventory at this point, whereas others require the goods to be delivered to a specific stock location before inventory is updated. This depends entirely on the customer requirements and how the system is set up. Lesso. : Organise ASN on your system for automatic receiving and put-away. Ideally, use RF equipment for scanning and updating your management systems. 2. Put-Away A good system will prompt put-away staff with a note indicating that stock is in staging waiting to be transported to a storage location. The process commences when operators accept the put-away task from the Enterprise Resource Program (ERP) or Warehouse Management System (WMS), and then scanning the relevant barcode of goods to be put away. If there is no barcode, then a manual entry can confirm that the goods have been identified. At this point the system will be directing the put-away staff to deliver goods to the relevant storage location. Once at the location, the operator will either scan the relevant stock location barcode, or manually confirm that the correct location has been found, then place the goods into the slot before confirming that the put-away process is complete. Lesson: Use a system that can direct put-away to vacant slots according to demand of the goods. ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 3124142020 1 key Warehouse Processes 3. iB There are two main types of picking. Primary: This is the first picking of goods. In some cases, the first picking is delivered directly to a staging area or packing bench for finalisation, consigning and dispatching, thus the first picking becomes the last picking. Secondary: This is a second picking process. Some primary picks are subject to a second picking process, particularly where picked goods must be allocated to clustered orders (bunch of orders), or discrete orders (single orders) via a sortation process or system. With the boom in online sales across many industries, far more companies are conducting secondary picking processes than ever before. Once orders are received, it is common for orders to be released ‘real-time’ or in ‘waves’. Real-time orders are downloaded as they are received. Orders accumulated for specific picking times and transport routes are called ‘waves’. Waves can be released at the discretion of the DC manager according to criteria that they determine. As alluded to above, picking may be discrete, i.e. one order ata time, clustered, i.e. multiple orders at a time, or batched, i.e. picking all the goods at once to sort to specific customer orders. Often, companies may use all three types of picking. With increasing online orders, companies are increasingly installing picking apparatus such as put walls, put-to-light systems, goods-to-person systems and cross-belt sortation systems, to cope with the larger volume of small orders. What about accuracy of picking? This is one of the most common questions asked by warehouse managers. Should you scan the product or location, or both during picking? ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 4124142020 1 key Warehouse Processes The unrelenting technology improvement and complexity of modern-day business dictates that companies invest in appropriate ERP and WMS systems to remain competitive. This depends largely on the degree of accuracy required. If both are scanned accuracy increases, but picking velocity will be lower compared to simply scanning the location. Where voice systems are used, no scanning will be used, but check digits at the location serve to ensure the operator is at the correct location. Voice picking obviates the need to scan at all, but with a touch of risk. The risk lies in the operator achieving the right count, upon picking, without making a mistake. While companies worry about the accuracy issue, evidence suggests that voice picking and/or scanning the location only, gives a surprisingly high level of accuracy, without impeding picking velocity. For ‘accuracy intensive’ warehouses, accuracy can be enhanced by a statistical example of QA checks, normally around 10 to 20% of orders. |ntps:ihwwwlogistiesbureau,comspoighon-7-koy-warchouse-pracesses/ 124142020 1 key Warehouse Processes Lesson: Picking uses a large amount of resources, and can reflect around 60% or more of warehouse staff. Smart picking systems and WMS are a must for increasingly complex businesses. 4, Packing There are scores of ways that goods are packed within distribution centres. Rather than delve into the specific details of packing processes, it’s suffice to follow five rules for successful packing: 1. Goods picked must be traceable in terms of location from which they are picked, plus relevant ‘use-by dates and/or ‘batch’ dates and codes. 2. Accuracy and QA checks must be built into the process. 3. Goods picking from different zones within the warehouse must be easily ‘combined’ and systern-managed to ensure order completeness. 4, Goods must be packed according to their size, quantity, temperature, toxicity, value, fragility, hygiene and legislative requirements. 5. Consignments must always be system-traceable to documents and/or invoice numbers for future traceability. Lesson: Packing is an extension of the picking process and must be system-managed and treated with care to ensure that orders are complete, and accurate. 5. Dispatching ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! iz‘2020 7 key Warehouse Processes The successful art of dispatch lies in the operation's ability to have goods ready for departure, just in time for carriers to load their trucks. The DC manager must therefor balance and forecast packing and dispatching according to carrier pick-up times. Goods that are ready too early, for example, will clutter staging areas, while dispatches that are late, will delay loading and potentially cause late deliveries. As indicated earlier, many firms resort to using their systems to release orders, for picking and packing in waves, aligned to specific delivery routes or carrier types. Lesson: Avoid jambs and late deliveries by scheduling picking waves to align with carrier picking up times. 6. Returns This is something most companies wish will just disappear! However, returns are an intricate part of most businesses, and alas, the volume of returns is growing for many organisations - mainly due to the e-commerce revolution. Alarmingly, much of returns for many firms is for just one item at atime. The complexity around handling returns mandates the following rules: 1, When customers return goods, they should seek, and be given Return Management Authorisation, which outlines what is being returned and why. 2. All returns must be traceable, to their order, document and invoice. 3. Companies must have a pre-determined returns process that delineates What is to be done with the goods once received back into the warehouse, e.g. return to stock, repair, destroy, discard, recycle, return to manufacturer, etc. ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 24sua2020 7 Key Warehouse Processes 4. All credits must be system-recorded together with reasons why the goods are returned, 5, Inventory must be updated where goods are returned to stock, or held for further action. Lesson: Returns is a complex part of any business. A defined process must be in place that accurately and reliably records the whole transaction and credit process. Review your value-adding processes and make sure that your system can handle the requisite activities and transactions. 7. Value-Adding This is the part of the business where products are produced, kitted, assembled, relabelled, modified, ‘burntiin’, or subject to some other value hitps hvu Jogistiesbureau.com/spotigh-on-7-key-warehouse-processes! 8124‘2020 7 key Warehouse Processes adding process. The value adding part is about performing work on the product to make it ‘ready for sale’. This process of value-adding can be complex, particularly when many different items are combined to form a new product. Complexity around handling value-adding processes and the changing nature of component products in and out of shelf locations can be daunting. Over the years, systems have evolved to assist, yet there are many companies that find recording of value-adding components may be incompatible with how the logistics system or conventional ERP or WMS have been set up. Lesson: Review your value-adding processes and make sure that your system can handle the requisite activities and transactions. To Conclude So, there you have it, 7 key processes that are ‘same same’, yet ‘different’ for each organisation. From the above, you will realise that modern distribution centre supply chains are a complex mass of processes, activities and transactions. All of which must be individually crafted by humans to make your warehouse operate effectively. The days of using a pad and pencil or even a spreadsheet to manage warehouse functions don’t seem very long ago, yet the unrelenting technology improvement and complexity of modern-day business dictates that companies invest in appropriate ERP and WMS systems to remain competitive. Equally important is that they are correctly configured to the ‘different’ aspects of your business. ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 9124142020 1 key Warehouse Processes Best Regards, Mal Walker Email: mwalker@logisticsbureau.com Phone: 0412 271 503 34 Comments Alex Mumo Muia on July 26, 2018 at 6:38 pm Nice Read. Is it possible | get your opinion on the best platforms out there which can help me in achieving the above objectives seamlessly and at reasonable costs Rob O'Byrne on August 29, 2018 at 7:46 am. Sorry I cannot advise on specific platforms. As a consultant in this area | must remain vendor neutral. Reply Moulid Abdirahman Ali on December 25, 2018 at 4:51 am Ihave custom procedure and warehousing how improving the facilitating and controlling the whole operational of the custom? ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 0124142020 1 key Warehouse Processes what kind about consultations and experience knowledge you Reply Rob O'Byrne on December 25, 2018 at 3:10 pm rise, Feel free to contact me directly, via the contact us page. Reply if vincent on February 11, 2019 at 5:57 pm describe two ways of warehouse location Reply Rob O'Byrne on February 11, 2019 at 6:08 pm. Hi. I'm not sure | understand your question. Do you mean how to locate products in a warehouse? Or do you mean two techniques to determine an ideal warehouse location in a country / city? This video is not due to be released for 2 days, but it may help you. See the links under the video also. https://youtu.be/Cnp16bSTKFg Reply Ntombi on August 13, 2019 at 10:00 am ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 128sar2020 7 Key Warehouse Processes Hi | would like to know what is the key processes found in most warehouses hitps hvu Jogistiesbureau.com/spotigh-on-7-key-warehouse-processes! Reply Rob O'Byrne on August 13, 2019 at 10:04 am Hi, In basic terms, the key processes would include: Receiving Putaway Stocktaking Picking Packing Dispatch Returns They are described in this article... Reply Thulani on December 23, 2019 at 7:50 pr You should are there good margins, say compared to residential properties Rob O'Byrne on December 24, + 2019 at 9:39 am 2124‘2020 7 key Warehouse Processes By owning warehouses? | think given the rapid changes in warehousing that are occurring, Id stick to residential. But I'm sure it varies country to country. Here in Australia most of the larger warehouses are owned by large property companies. Marc on August 26, 2019 at 12:08 pm Rob Good article. Found myself flown into a implementation challenge in Vn this week and accessed this article to get my head straight at short notice. | would have added ‘staging’ as a sub set of one of the processes. Thanks again and good to acknowledge simple contributions like this. Reply Rob O'Byrne on September 4, 2019 at 6:38 pm. Reply is it possible to track a person who put away stock but the Glad it Helped! reti on Septernber 23, 2019 at 7:59 pn lable still open..or what if they just dumped the stock in Reply ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 13124 anywhere without scanning into a location.142020 1 key Warehouse Processes Rob O'Byrne on September 23, 2019 at 8:26 pm Yes. Most good WMS (Warehouse Management Systems) will track each user and he tasks / activities they perform. It’s an aid to balancing work across the team as well of course, as tracking individual productivity and errors. Reply if Kevin Boutin on October 4, 2019 at 2:47 am | adore this useful article. Excellent compilation sir. Reply a Rob O'Byrne on October 9, 2019 at 6:37 pm Glad you found it useful..... Reply i Ropate on November 22, 2019 at 9:16 am What are some of the financial SOP that can be implemented to improve the above processes? Reply a Rob O'Byrne on November 30, 2019 at 9:05 am Have a look at the page on KPIs. https://www.logisticsbureau.com/kpi-key- performance-indicator/ ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! wiz142020 1 key Warehouse Processes Reply how can a supplier who is found to be supplying sub- standard product handled when the purchasing department is not ready to deal with the supplier? Reply Rob O'Byrne on December 5, 2019 at 9:06 pm Oluwatosin on December 5, 2019 at 8:47 pm. Itis really a procurement (supplier management) issue rather than purchasing. The facts need to be presented to the head of procurement for action, if the team are unwilling to Reply Stephen on December 11, 2019 at 6:45 pm take action Hii am in Uganda and i want to open up na consulting firm.can you advise Reply Rob O'Byrne on December 11, 2019 at " 6:52 prn Hi, as with any business... (1) Assess the market. What services are required most? What is the size of the ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 19124‘2020 7 key Warehouse Processes market? (2) Develop a profile of your ideal client. Type of company, size, type of problems they have. (3) Research the competition, Who are your major competitors? What services do they offer? How can you differentiate your business? (4) Talk to some potential clients, get their feedback. (5) If it all looks worthwhile.........start! Reply ;] Stephen on December 11, 2019 at 8:28 pm Thanks so much i appreciate, will consult you as soon as i start Reply a : Rob O'Byrne on December 11, 2019 at 8:55 am You might find this blog useful. It's about starting a consulting business! https://www.consultingbusinessschool.com/ Reply ;] Stephen on December 11, 2019 at 10:11 pm Thanks Rob Reply ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 0124 a142020 1 key Warehouse Processes Stephen on December 11, 2019 at 11:00 pm Thank you for the encouragement, kindly inbox me all information Reply . Value-Adding whats is this can you give me one example sardar singh on january 2, 2020 at 5:32 am Reply a Rob O'Byrne on January 16, 2020 at 12:18 pm It might be things like kitting, bundling, tagging... Reply great piece of article Rob...... but i am thinking shouldn't the value adding process be inclusive with the Receiving process because from what i can see from the process stated by the logistics bureau value adding is the last process which i find inappropriate, although the process of Edet on March 5, 2020 at 11:03 prn warehousing/ receiving in various countries actually varies but your intellect clarity is highly Reply ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! rie welcomed142020 1 Key Warehouse Processes Rob O'Byrne on March 6, 2020 at 9:36 ’ pm Yes, you are right. Value adding could be done at receiving for things like bundling, kitting and the like. Reply Edet on March 11, 2020 at 9:25 pr Alright..thank you Rob Reply a Simon Kwok on March 19, 2020 at 4:52 pm Thanks and a nice reading. Interested in ways to facilitate warehouse operations. Reply what type of written assessment question ( scenario Bishwa Khadka on May 30, 2020 at 2:20 am question) can ask for supply officer? Can you provide some sample question for supply officer {special related to centralized warehouse / supply chain operation }? Reply Rob O'Byrne on june 4, 2020 at 5:35 am ntps:ihwwulogstiesbureau.comispolighton-7-key-warehouse processes! 8124‘2020 7 key Warehouse Processes That would require more than a simple reply on a blog post, sorry. CHECK OUT OUR ONLINE LEARNING PROGRAM SUPPLY CHAIN SECRETS YES! Please send me your fortnightly email Bulletin full of Tips and Insights. Email Address SUBSCRIBE Recent Posts Get a Supply Chain Job Overseas Definitions for Supply Chain & Logistics ~ LLP, 3PL, 4PL and More 3 Supply Chain Things You Need to Focus Right Now to Reduce Risk Supply Chain after the Crisis? 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