Chapter 9
warehouse
A facility used to store purchases, work-in-process (WIP), and finished goods inventory
site selection, number, layout, receiving, storing, retrieving, distributing
Decisions driving warehouse management include _____, the _____ of warehouse facilities in the network, the ____ of the warehouse(s), and the methods of ____, ____, ____, and ____ products and materials
warehousing
Function that allows a company to receive, store, breakdown, repackage, and distribute items to a manufacturing location, or finished products to a customer
slots
It is essential that products be assigned a specific locations in the warehouse called ____
efficiently, required, complete, shipment
Objective of warehouse operations is to: _____ receive inventory Store it as _____ Assemble it into _____ orders Make a customer _____
velocity
Storage plans should consider product ____ as a major factor in determining the warehouse layout
seasonal storage
Storage provides direct benefit by accommodating seasonal demand and/or production Accommodates seasonal demand such as lawn furniture and toys Accommodates seasonal production such as agricultural products
dwell time
Strategic warehousing offers manufacturers a way to reduce ____ _____ of parts and materials
sorting
The basic benefit of _____ is to reconfigure freight as it is being transported from origin to destination
cross docking
The logistics practice of unloading materials from an incoming truck or railcar and loading these materials directly onto outbound trucks or railcars, with little or no storage in between to reduce inventory investment and storage space requirements
customer service, inventory
Trade-offs that will determine how many warehouses the company needs and where they should be located are; (1) the level of ____ ____ the company wants to provide and (2) the amount of _____ the company is willing to invest in
break bulk
Warehouse operation that divides full truckloads of items from a single source or manufacturer into smaller, more appropriate quantities for use or further distribution
consolidation
Warehouse operation that receives products from different plants or suppliers, sorts them, and then combines them with similar shipments from other plants or suppliers for further distribution
safety, maintenance
____ and ____ issues must also be considered when planning warehouse designs inclues: accident prevention environmental protection maintenance
hybrid
_____ warehouse network approach Companies may choose to do some type of a hybrid approach to balance costs and inventory against customer service hub and spoke model
yard, labor, optimization, value added, returns
advanced functionality of warehouse management: ____ management ____ management warehouse ____ ____ ____ services planned cross dock ____ management
services, cost, control
advantages of contract warehouse ownership: _____: client can obtain specialized services tailor-made to suit their needs. _____: can be bundled in the contract and negotiated at a lower cost. _____: contract warehousing offers a degree of control at a reasonable price
control, visibility, cost
advantages of private warehouse ownership: _____: Offers greater flexibility in designing the warehouse and gives users significant control over operations. _____: inventory, material flow, handling, supervision, and associated costs. _____: Operating cost can be 15% - 25% lower if the company achieves at least 75% utilization
capital investment, flexibility, costs, risk, temperature
advantages of public warehouse ownership: No ___ ____ or property taxes ________: Can be short or long term contract For seasonal products Add storage capacity even on short notice Lower _____ and reduced _____ Access to special features and services: ______-controlled storage Customer Service, Inventory Ordering, etc. Office space for customer's sales, accounting, etc.
flexibility
an important goal in warehousing is the maximize ______ respond to ever-changing customer demand in product assortments, value-added services, shipment sequencing
cycle count
benefit from what WMS functionality ability to conduct and resolve real time inventory counts
error correction
benefit from what WMS functionality ability to identify, resolve, and correct data errors in real time ability to identify and resolve differences in purchase orders or advanced shipment notifications and actual quantities or product received
pick/replenishment
benefit from what WMS functionality direct picking from single or multiple locations including pick to assure expiration date compliance facilitates replenishment of pick location inventories when appropriate
return goods
benefit from what WMS functionality facilitate processing and audit compliance for reverse logistics programs
cross docking
benefit from what WMS functionality facilitates direct receipt to shipment flow
work queue resolution
benefit from what WMS functionality identification of alternative ways to rapidly or efficiently resolve work constraints or queues
put away
benefit from what WMS functionality improved productivity and cube utilization
simulations
benefit from what WMS functionality performance of real time decision support scenarios to assist in operational decision making
picking strategy
benefit from what WMS functionality routines to perform selected picking strategies
task interleaving
benefit from what WMS functionality routing of fork trucks on demand as contrasted to predetermined assigned tasks, areas, or sequences
inventory visibility
benefit from what WMS functionality tracking specific inventory lots by warehouse location as well as daily visibility of receipts; date specific lot control
slotting
benefit from what WMS functionality variable slot or product placement locator assignment to enhance space utilization
customer, shorter, longer
break bulk warehouses are located closer to the _____ base so that the smaller LTL shipments travel the ____ distance, while the larger FTL shipments from the single source travel the ____ distance before arriving at the break-bulk
mixing
combines inventory from multiple origins (like cross-docking) but also adds items that are regularly stocked at the mixing warehouse usually performed at an intermediate location between origin and destination, such as a cross-docking operation
supply, shorter, longer
consolidation warehouses are located closer to the ____ base so that smaller LTL shipments travel ____ distance and can be consolidated into larger FTL shipments traveling ____ distance to the customer
task, quality, replenishment, cross dock
core functionality of warehouse management systems: receiving put away cycle count pick ____ management ____ analysis ______ pack opportunistic ____ ____ inventory control work order management ship
duration
disadvantages of contract warehouse ownership: ______: The client company is expected to enter into a contract for a specific period of time; generally three years
high start up cost, fixed location, fixed size and costs
disadvantages of private warehouse ownership: ______: Capital to build or buy a warehouse. Long, risky investment. Cost of hiring and training employees. Purchase of material handling equipment. ______: Not easy to move to another location if the market changes. ______: When volume is low, the company still assumes the fixed costs
computer, required, space
disadvantages of public warehouse ownership: Potential for incompatible _____ systems Specialized services may not be what is ______/needed _____ may not be available when/where needed
consolidation, sorting, seasonal, reverse
economic benefits of warehousing occur when overall logistics costs are reduced through _____ and break-bulk, ____, _____ storage, and _____ logistics
distribution networks, strategic assortment
evolution of strategic warehousing: Warehouses were once viewed as a necessary evil, used to coordinate product supply with customer demand The explosion of the consumer economy after WWII saw the rise of____ _____ for consumer goods Warehousing shifted from passive storage to ____ _____
providing
for contract warehouse ownership, the company _____ the space handles the employees, equipment, and maintenance
years, months
for contract warehouse ownership, usually requires a client to commit to services for _____ rather than _____
shipping
function of a warehouse Outgoing shipment of parts, components, and products. Includes packaging, marking, weighing, and loading for shipment
receiving
function of a warehouse Physical receipt of material, identification, inspection for conformance with the purchase order (quantity and damage), put-away, and preparation of receiving reports
packing
function of a warehouse Placing one or more items of an order into an appropriate container for safe shipping , and marking and labeling the container with customer shipping destination data, and other information that may be required
storage
function of a warehouse The safe and secure retention of parts or products for future use or shipment
picking
function of a warehouse Withdrawing components from stock to make assemblies or finished goods, or to ship to a customer
site, expansion, sizing, security
handling and storage efficiency warehouse decisions that determine handling and storage efficiency: ____ Selection Design Product Mix ____ Material Handling Layout _____ Warehouse Management System Accuracy and Audit _____ Safety and Maintenance
warehouse management system
integrate procedures and software support to standardize storage and handling work procedures
few, many
market positioned strategy has ____ suppliers and ____ customers
handling
must optimize movement continuity and efficiency typically, these activities require the use of material handling equipment, e.g., lift trucks, conveyors, etc
complicated, operating, inventory, duplication, larger
negatives of multiple warehouse network: More _____ _____ costs and ____ will be higher as each warehouse costs money to staff and operate. ____ of equipment, warehouse staff, and managers Network will be decentralized and the company will have to spread its best people, equipment and inventory systems across a ____ network
deliver product
negatives of single warehouse network: the centralized network may take longer to ____ ____ to some customers who are remote from the central location
order
one main use of the warehouse management system is to coordinate ____ selection
assembly operation
other function of a warehouse Warehouse operation that puts products together with other items/components before shipping them out to the final customer ex- literature, spare parts, advertising materials
repackaging
other function of a warehouse ____ for specific customer orders
quality
other function of a warehouse _____ inspections, incoming and outgoing
inventory accuracy, cycle counting, audits, security issues
other warehouse planning issues: ____ _____ is typically maintained by annual physical counts or counting portions of inventory on a planned basis ____ ____ is the audit of selected inventory on a cyclic schedule _____ are common to maintain safety, assure compliance to regulations and help improve procedures ____ ____ involve protection from pilferage and damage
lower, safety stock, customer service
positives about hybrid warehouse network approach: Operating costs are _____ because the spoke warehouses are smaller than in a decentralized model Inventory is also lower as all of the ___ ____ is held centrally, which generally means that less total safety stock is required because all of the risk and uncertainty is managed centrally ____ ____ is generally better than in a purely centralized model since some of the inventory is maintained closer to the customer
faster, decentralized
positives of multiple warehouse network: Potentially _____ delivery to customers from a ____ network that is geographically dispersed throughout the market, assuming adequate inventory in each warehouse
complicated, lower, equipment, managers, centralized
positives of single warehouse network: Less _____ Operating costs and inventory will be ____ No duplication of ____, warehouse staff, and ____ Network will be ____ and the company will have its best people, equipment and inventory systems concentrated in one place. Warehouse can more actively focus on the needs of its customers
many, few
product positioned strategy has ___ suppliers and ____ customers
returns management, remanufacturing and repair, remarking, recycling, disposal
reverse logistics includes activities supporting: ___ ____: Recalls or product that did not sell ____ ___ ____: Repairing/refurbishing equipment _____: Selling used equipment _____: Returning product following its useful life with the objective of decomposing it into it component materials so they can be effectively reused ______: for materials which cannot effectively be reused.
buffer
seasonal storage provides and inventory ____, which allows production efficiencies within the constraints imposed by material sources and consumers
value added services
service benefit of warehousing include any work that creates a greater value for customers
full line stocking
service benefit of warehousing provides one-stop shopping capability for goods from multiple suppliers
spot stocking
service benefit of warehousing the positioning of inventory for seasonal or promotional demand
spot, full line, value added
service benefits of warehousing are justified by sales improvements that more than offset added cost through ____-stocking, ___ ___stocking, and ___ ___ services
velocity, weight, special storage requirements
slotting determines specific locations for the product based on what 3 things?
active storage
storage alternative Storage for basic inventory replenishment Focuses on quick movement Includes flow-through or cross-dock distribution
extended storage
storage alternative Storage for inventory held in excess of period for normal replenishment e.g., seasonal, speculative, or even commodities
economic, service
strategic warehousing can provide both ____ and ____ benefits
contemporary
the ____ view of the value of warehousing: the warehouse functions to mix inventory assortments to meet customer requirements storage of products is held to a minimum storage of inventory is waste in the lean warehouse
traditional
the _____ view of the value of warehousing: a place to hold or store inventory
fulfillment centers
the changing role of warehouses originally were traditional warehouses, eventually became distribution centers, and are now ____ _____
traditional warehouses
the changing role of warehouses these are the characteristics of ______: Receiving Put-away Storage Operations Picking Packing Shipping
fulfillment centers
the changing role of warehouses: these are the characteristics of _____: Dynamic Cross-docking Mixed Mode Fulfillment Multi-channel including On-line Fulfillment Distributed Order Management Green Operations (e.g., end of product life disposition, recycling, reclamation)
distribution centers
the changing role of warehouses: these are the characteristics of _____: Scheduled Cross-docking Special Handling Kitting Operations Returns Handling "Postponed" Manufacturing Steps Other value added services
many, where
the fundamental questions to be answered in establishing a warehouse network are: How _____ warehouses does the company need? _____ should they be located?
central site, consolidate, break-bulk
the main reasons that cross docking is implemented is to: Provide a ____ ____ for products to be sorted and combined for delivery to multiple destinations in the most productive and fastest method possible _____: Combine smaller product loads into one method of transport to save on transportation costs ______: Break down large product loads into smaller loads for transportation for an easier delivery process to the customer
warehouse network
the number of, and the relationship between, the warehouses that a company has in their organizational structure
operational efficiency, inventory efficiency
the two advantages of cross docking _____: Warehouse operations are more efficient as the material does not have to be stored at the warehouse, moving directly from receiving to shipping _____: As there is no storage at the warehouses, total inventory in the supply chain can be reduced
in storage
type of handling Moving goods within the warehouse for storage (transfer) or order selection (picking). Items may be moved to a staging area in preparation for shipping
receiving
type of handling Unloading the arriving vehicles
shipping
type of handling Verifying the order and loading the departing vehicles
assembly
type of sorting occurs when products or components from 2nd Tier suppliers are assembled by a warehouse located near the manufacturing plant supports manufacturing operations
handling, storage
warehouse operations involve two major activities: ____ and _____
JIT
warehousing is integral for ______ and stockless production strategies (requires strategically located warehouses across the globe)
packaging, color customizing
what are 2 common assembly processes
spot stocking, full line stocking, value added services
what are 3 service benefits of warehousing
public, contract, private
what are the 3 types of warehouse ownership arrangements
distribution centers, consolidation terminals, break-bulk facilities, cross-docks
what are the 4 warehousing types
receiving, storage, picking, packing, shipping
what are the 5 primary functions of a warehouse
cross docking, mixing, assembly
what are the three basic types of sorting
market positioned strategy
what type of warehouse network strategy Close to customers to maximize distribution services and improve delivery.
product positioned strategy
what type of warehouse network strategy Close to supply source to collect goods and consolidate before shipping products out to customers.
intermediately positioned strategy
what type of warehouse network strategy Midway between supply source and customers, when distribution requirements are high and product comes from various locations Relatively equal number of suppliers and customers
public
what type of warehouse ownership? A business that provides storage and related warehouse functions to companies on a short or long-term basis, generally from month-to-month Own their own equipment and hire their own staff to manage the facility. Fees are typically a combination of a monthly storage fee plus a pallet-in fee and a pallet-out fee
private
what type of warehouse ownership? A storage facility that is owned by the company that owns the goods being stored in the facility Generally established by companies that have a large volume or highly valuable goods, or the need for some type of specialized storage or handling Can be operated as a separate division within a company Can be co-located on-site with manufacturing, or off-site
contract
what type of warehouse ownership? A variation of public warehousing that handles the shipping, receiving, and storage of goods on a contract basis The contract can be for an entire building, or for a defined portion within a building The fee structure may be fixed cost, cost-plus, or a combination of both
discrete selection
when a specific customer's order is selected and prepared for shipment as a single work assignment
wave selection
when orders are processed through zones of the warehouse assigned to specific employees also called batch selection