Slide 1Learning ObjectivesWarehousing ManagementWarehousing ManagementWarehousing ManagementWarehousing ManagementWarehousing ManagementSlide 8Public WarehousingPrivate WarehousingContract WarehousingMulticlient WarehousingDesign Considerations in WarehousingSlide 14Warehousing Trade-offsWarehousing Trade-offsWarehousing Trade-offsWarehousing OperationsWarehousing OperationsWorkplace Safety IssuesSlide 21Slide 22Slide 23Slide 24Slide 25Slide 26Slide 27Slide 28Slide 29Chapter 10Warehousing ManagementLearning Objectives•To understand the role of warehouses and distribution centers in a logistics system•To identify the various types and functions of warehouses•To distinguish the various alternatives available in warehouse design•To examine the different types of handling equipment available•To analyze the issue of employee safety in warehousing© 2008 Prentice Hall 10-2Warehousing Management•Key Terms–Accumulating (bulk-making)–Allocating (bulk-breaking)–Assorting–Bonded storage–Contract (3rd party) warehousing–Cross-docking•Key Terms–Distribution centers–Dunnage–Field warehousing–Fixed slot location–Multi-client warehousing–Occupational Safety & Health Administration (OSHA)© 2008 Prentice Hall 10-3Warehousing Management•Key Terms–Paperless warehousing–Private warehousing–Public warehousing–Regrouping function–Sorting out–Throughput–Variable slot location–Warehouse•Key Terms–Warehouse management system (WMS)–Warehousing© 2008 Prentice Hall 10-4Warehousing Management•Warehousing refers to “that part of the firm’s logistics system that stores products (raw materials, part, good-in-process, finished goods) at an between points of origin and point of consumption.”Source: Douglas M. Lambert, James R. Stock, and Lisa M. Ellram, Fundamentals of Logistics Management (New York: Irwin McGraw-Hill, 1998), Chapter 8.•Warehousing management has evolved to include value-adding services–Custom labeling–Promotional pack–Grouping and sorting of products–Kitting for production–Display building and packaging–Price marking© Pearson Education, Inc. publishing as Prentice Hall10-5Warehousing Management•Warehousing and transportation are substitutes for each other, with warehousing having been referred to as “transportation at zero miles per hour.”© Pearson Education, Inc. publishing as Prentice Hall10-6Warehousing Management•Warehousing serves to match different rates or volumes of flow when patterns of production and consumption do not coincide•Distribution centers emphasize rapid movement of products through the facility•Throughput is the amount of product entering and leaving a facility in a given time period•Regrouping function–Accumulating (increasing quantity)–Allocating (reducing quantity)–Assorting (building up a variety of products)–Sorting (separating products into grades and qualities)© 2008 Prentice Hall 10-7Adding a Warehousing Facility: Shorter-Haul Transportation (Fig. 10-1) © 2008 Prentice Hall 10-8ProducerRetailer ARetailer BRetailer CProducerRetailer ARetailer BRetailer CWarehouseVolumeShipmentPublic Warehousing•Public warehouses –Serve all legitimate users–Require no capital investment on the user’s part–Allows users to rent space as needed–Can be rented on a month-to-month basis–Offers more locational flexibility–May provide specialized services•Potential drawback of public warehouses–Lack of control by the user•Warehousing labor safety practices monitored by Occupational Safety and Health Administration (OSHA)© 2008 Prentice Hall 10-9Private Warehousing•Private warehousing –is owned or occupied on a long-term lease–Offers control to owner–Assumes both sufficient demand volume and stability so that warehouse remains full•Potential drawbacks of private warehouses:–High fixed cost–Necessity of having high and steady demand volumes–May reduce an organization’s flexibility© 2008 Prentice Hall 10-10Contract Warehousing•Contract warehousing (3PL warehousing) is a long-term arrangement providing unique warehousing services to one client •Both vendor and client share the risks associated with the warehousing•Less costly than private warehousing and more costly than public warehousing© 2008 Prentice Hall 10-11Multiclient Warehousing•Multiclient warehousing–Mixes attributes of contract and public warehouses–Services are more differentiated than those in a public facility–Services are less customized than those in a private facility–Services are purchased through minimum 1 year contracts –Are attractive to smaller organizations © Pearson Education, Inc. publishing as Prentice Hall10-12Design Considerations in Warehousing•General considerations–Quantity and character of goods must be known—product profiling–Know the purpose to be served•Storage•Distribution•Cross-docking© 2008 Prentice Hall 10-13© 2008 Prentice Hall 10-14Ideal Facility for Pure Supplier Consolidation (Figure 10-5)Warehousing Trade-offs•Fixed versus variable slot locations for merchandise•Build out (horizontal) versus build up (vertical)•Order-picking versus stock-replenishing functions•Two-dock versus single-dock layout© 2008 Prentice Hall 10-15Warehousing Trade-offs•Labor-intensive versus mechanization versus automation•Space devoted to aisles versus space devoted to storage•Picker-to-part versus part-to-picker systems© 2008 Prentice Hall 10-16Warehousing Trade-offs•Paperless warehousing versus traditional paper-oriented warehousing operations•Virtual warehouse versus real warehouse•Other space needs•Retail storerooms© 2008 Prentice Hall 10-17Warehousing Operations•Storage and handling equipment•Warehouse management systems•Employee safety–OSHA oversees–Proper handling of waste materials •Dunnage –Proper handling of breakage© 2008 Prentice Hall 10-18Warehousing Operations•Warehousing security•Hazardous materials•Sanitation issues•Stock controls© 2008 Prentice Hall 10-19Workplace Safety Issues•Mannix Model Markets - Omaha, Nebraska1-21Company Facts:Company Information:•55 stores, served by daily deliveries (5 days/week)•Member of a buying cooperative•Some items are delivered directly by vendors•Schoenecker’s candiesDecisions:Case 10-1 Sandy’s Candy•Mannix Model Markets - Omaha, Nebraska1-22Company Facts:Company Information:•55 stores, served by daily deliveries (5
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