Chapter 10

Which of the following is not a good reason for warehousing? to keep inventories for the sake of obsolescence to support customer service requirements allows economies-of-scale in transportation and production allows firm to take advantage of quantity purchase discounts smoother coordination of supply and demand

to keep inventories for the sake of obsolescence

Public warehousing makes more sense than private warehousing when: customer service requirements are low and market density is high. volume is high and very predictable with little variation in demand. volume is low with high variability in demand and significant seasonality. products are valuable and require high level of security. customers are close to our facility and products are not seasonal.

volume is low with high variability in demand and significant seasonality.

What is the name given to information applications that coordinate the activity within a warehouse facility? quick response mechanism ship-and-save system enterprise resource plan warehouse management system on-line merchandising network

warehouse management system

The item fill rate for an item that is shipped complete 6 times out of 10 orders, and ships 55 units out of the 100 requested in the 10 orders, is 60 percent. True/False

False

Which reason below justifies the use of contract warehousing? The risks of inventory loss and damage are minimal in contract warehousing. It provides the warehouse customer with greater control than private warehousing. It demonstrates a greater commitment to customers than buying a private warehouse. It requires more in-depth negotiations than public warehousing to secure. It allows the company a degree of control yet is less expensive than private warehousing.

It allows the company a degree of control yet is less expensive than private warehousing.

The primary inspiration for Six Sigma comes from what company? Walmart Hewlett Packard Motorola Panasonic Toyota

Motorola

A "smart" WMS won't let the picker move to the next item until the mistake has been corrected. True/ False

True

Which factor below would suggest the construction of a smaller (rather than larger) warehouse? fewer stockkeeping units (SKUs) carried many markets served higher levels of customer service expected long production lead times the need for economies-of-scale in warehousing and materials handling

fewer stockkeeping units (SKUs) carried

The warehouse activity that involves the selection of particular stock items needed to fulfill a customer order is: warehouse shopping stockpiling order picking storage placement cross-docking

order picking

What form of warehousing is owned by the firm using them? public contract multi-client third-party private

private

Which term refers to the volume of material or product that moves through a warehouse facility over a given time? finished goods work-in-process supply chain quantities throughput transit inventory

throughput

Cost is the only significant consideration that a company must factor into its decision to own and operate a warehouse, as opposed to hiring an outside firm. True/False

False

Cross-docking can achieve which of the following: Reduced warehousing cost Reduced inventory investment Improved inventory flow and velocity Improved synchronization between supply and demand All of the above

All of the above

What type of warehouse serves as a regional distribution point, where truckloads ship freight inbound with the local deliveries via less-than-truckload transportation? Customs warehouse Distribution center Raw materials warehouse Liquidation warehouse Breakbulk warehouse

Breakbulk warehouse

For a consumer goods company that seeks to reduce the distance to U.S. population from one location using a center of gravity approach, which city would offer the best choice for this facility? Cincinnati, Ohio Topeka, Kansas Denver, Colorado Buffalo, New York Dallas, Texas

Cincinnati, Ohio

What kind of warehouse facility performs very differently from a conventional warehouse by receiving inventory and shipping it out in the same day? Mix-and-match warehouse Rapid-flow warehouse Product mixing facility High-rise warehouse Cross-dock

Cross-dock

Which kind of warehouse allows a company to keep imported merchandise for a certain period of time without paying duties or tariffs? Consolidation warehouse Raw materials warehouse Duty-free shop Customs warehouse Distribution center

Customs warehouse

Which warehouse operation supports the mass customization of products in distribution centers once a customer order is placed? Customized packaging of water bottles with private labels is one example of this kind of operation. Form postponement Containerization of freight Contract warehousing Accumulating Materials handling

Form postponement

Which order fulfillment performance metric examines the orders picked, packed and shipped perfectly? Order accuracy Perfect order completion On-time delivery Order fill rate Order cycle time

Order accuracy

Which order fulfillment performance metric measures the time from order placement to customer receipt of delivery? Order fill rate Perfect order completion Order accuracy On-time delivery Order cycle time

Order cycle time

Which order fulfillment performance metric measures the percentage of orders delivered without changes, damage, or invoice errors? Perfect order completion Order cycle time On-time delivery Order accuracy Customer satisfaction

Perfect order completion

A visual signal that indicates an incorrect quantity of parts is about to be shipped to customers, allowing the operator to correct the problem before it is detected by a customer is an example of a: Kaizen Value stream remedy Muda Poka yoke Heijunka

Poka yoke

Which scenario below would suggest building your own private warehouse as opposed to using public warehouse space in a particular location? Space is required for product storage only and there are low customer service requirements. There are low throughput volumes and low market density. There are high customer service requirements and a need for a regional sales headquarters. Your products require no special materials handling and have low security needs. There is fluctuating demand and low market density.

There are high customer service requirements and a need for a regional sales headquarters.

All of the following are good examples of visual managment EXCEPT: Illustrating normal and abnormal outcomes to a work step Delineating where items should reside in the work environment when they are not in use Using kanban systems to signal inventory replenishment Watching customers complain about poor service Presenting work steps through pictures

Watching customers complain about poor service

The Lean principle of 5S dictates that: Japanese ways of doing business are always more efficient than American methods warehouses must have five degrees of redundancy in operations given uncertainty in satisfying customers five phases of order fulfillment operations is most efficient a safe and orderly work environment is also an efficient work environment statistics drive improvement in warehouse operations

a safe and orderly work environment is also an efficient work environment

A warehouse that uses automated forklifts that move up and down each aisle putting pallets in assigned racks is called: a cross dock a flexible warehouse a warehouse management system an automated warehouse a customs warehouse

an automated warehouse

A tool used to help identify the optimal location for a distribution point based on the locations and sales volumes of customers is called a: diffusion model center-of-gravity model supply chain map centrifuge model mix-and-match model

center-of-gravity model

Which alternative provides value-added warehousing and logistics services by a comprehensive third-party logistics (3PL) firm? private warehousing substantiated warehousing contract warehousing common warehousing new millennium warehousing

contract warehousing

Of the several costs that factor into the determination of the proper number of warehouse locations a firm needs to serve its customer base, which one of the following is an opportunity cost associated with that decision? workers' compensation costs inventory costs transportation costs warehouse costs cost of lost sales

cost of lost sales

What inventory method rotates inventory in order to minimize your risk of owning out-of-fashion merchandise. reverse logistics inside-out inventory last-in first out (LIFO) first-in first-out (FIFO) reverse-to-active (RTA) storage

first-in first-out (FIFO)

Which of the following is the least productive use of warehouses? inbound consolidation product mixing outbound consolidation labor and equipment utilization supply mixing

labor and equipment utilization

Which of the following is a principle of efficient product placement in the warehouse? order-common products should not be placed near one another you should use zig-zag routing for order retrieval be sure to stack high-value, fragile products fast moving products should be placed in remote storage areas place bigger, bulkier items near the inbound door

place bigger, bulkier items near the inbound door

Which of the following is a relatively new function performed in many warehouses? receipt of goods order picking order staging for shipment transferring products to storage product processing for final assembly

product processing for final assembly

The Square Root of N Rule shows us that: customer service levels increase with more inventory safety stock rises as the number of stocking locations goes up customer loyalty increases with additional warehouse locations 80% of sales comes from 20% of customers transportation costs increase when logistics is outsourced

safety stock rises as the number of stocking locations goes up

What is the most common platform used in the shipping and handling of bundled products in a supply chain? plastic totes plastic pallet metal racks steel bins wooden pallet

wooden pallet