Ch08 Warehousing

35
Chapter 8 Warehousing Decisions

Transcript of Ch08 Warehousing

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Chapter 8

Warehousing Decisions

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Chapter 8 Management of Business Logistics, 7th

 Ed. 2

 The Nature and

mportance of Warehousing n !""", #7$ %i&&ion, or '.8 percent

of (D) *as spent on *arehousing.

 The tota& supp&+ of .-. *arehousing space in!""" *as .! %i&&ion s/uare feet, an increasefrom !""' of 7'' mi&&ion s/uare feet of space.

Warehousing pro0ides time and p&ace uti&it+for ra* materia&s, industria& goods, and1nished products, a&&o*ing 1rms to usecustomer ser0ice as a d+namic 0a&ueaddingcompetiti0e too&.

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Chapter 8 Management of Business Logistics, 7th

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 The 4o&e of the Warehouse in theLogistics -+stem5  A Basic

Conceptual Rationale  The *arehouse is

*here the supp&+

chain ho&ds orstores goods.

6unctions of*arehousing inc&ude5 Transportation

conso&idation )roduct miing Crossdocing -er0ice )rotection against

contingencies -moothing

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Chapter 8 Management of Business Logistics, 7th

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 Ta%&e 8!Warehouse Value-Adding

Roles

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Chapter 8 Management of Business Logistics, 7th

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6igure 8!

Transportation Consolidation

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Chapter 8 Management of Business Logistics, 7th

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6igure 82

Supply and Product Mixing

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Chapter 8 Management of Business Logistics, 7th

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Basic Warehouse Decisions5

 A Cost Trade-of Frae!or"  :*nership

)u%&ic 0ersus contract 0ersus pri0ate

Centra&i;ed or Decentra&i;ed Warehousing <o* man+

Location

-i;e La+out What products *here

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Chapter 8 Management of Business Logistics, 7

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6igure 83

Basic Warehousing #ecisions

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Chapter 8 Management of Business Logistics, 7

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 The :*nership Decision )u%&ic *arehousing

costs most&+ a&&0aria%&e.

)ri0ate *arehousingcosts ha0e a higher1ed cost component.

 Thus pri0ate

*arehousing 0irtua&&+re/uires a high andconstant 0o&ume.

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Chapter 8 Management of Business Logistics, 7

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 The :*nership Decision 6actors to consider

 Throughput 0o&ume

-ta%i&it+ of demand

Densit+ of maret area to %e ser0ed

-ecurit+ and contro& needs

Customer ser0ice needs

Mu&tip&e use needs of the 1rm

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Chapter 8 Management of Business Logistics, 7

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 Ta%&e 82 FirCharacteristics Afecting the

$!nership #ecision

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Chapter 8Management of Business Logistics, 7th 

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)u%&ic Warehousing 4ationa&e for )u%&ic Warehousing

Limited capita& in0estment

6&ei%i&it+ )u%&ic Warehousing -er0ices

Bonded *arehousing

6ie&d *arehouses

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Chapter 8Management of Business Logistics, 7th 

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)u%&ic Warehousing )u%&ic *arehousing

regu&ation5

Lia%i&it+ 4eceipts

)u%&ic *arehousingrates %ased upon5

=a&ue 6ragi&it+ )otentia& damage

to other goods

=o&ume andregu&arit+ Weight densit+ -er0ices re/uired

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Chapter 8Management of Business Logistics, 7th 

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Contract Warehousing p 23> per +ear in 2''' to #2'.9 %i&&ion.

Compensation for seasona&it+ in products.

ncreased geographica& co0erage. ?%i&it+ to test ne* marets.

Manageria& epertise and dedicatedresources.

Less strain on the %a&ance sheet.

)ossi%&e reduction of transportation costs.

:ther issues discussed in Chapter !!.

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Chapter 8Management of Business Logistics, 7th 

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 The Num%er of Warehouses 6actors ?@ecting the

Num%er of Warehouses

n0entor+ costs

Warehousing costs  Transportation costs

Cost of &ost sa&es

Maintenance of

customer ser0ice&e0e&s

-er0ice sma&& /uantit+%u+ers

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Chapter 8Management of Business Logistics, 7th 

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 Ta%&e 835 Factors Afecting

the %u&er o' WarehousesFactor Centralized Decentralized  

-u%stituta%i&it+ Lo* <igh

)roduct =a&ue <igh Lo*

)urchase -i;e Large -ma&&

-pecia&

Warehousing Aes No

)roduct Line Di0erse Limited

Customer -er0ice Lo* <igh

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Chapter 8Management of Business Logistics, 7th 

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Basic Warehouse :perations

Mo0ement 4ecei0ing

)uta*a+ :rder picing -hipping

-torage -toc &ocation Warehouse Management -+stem

WM-

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Chapter 8Management of Business Logistics, 7th 

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6igure 8Basic Warehouse $perations

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Chapter 8Management of Business Logistics, 7th 

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Warehouse La+out andDesign

De0e&op a demandforecast.

Determine each itemsorder /uantit+.

Con0ert units into cu%icfootage re/uirements.

?&&o* for gro*th. ?&&o* for ade/uate ais&e

space for materia&shand&ing e/uipment.

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Chapter 8Management of Business Logistics, 7th 

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Warehouse La+out andDesign

)ro0ide for thetransportation

interface. )ro0ide for order

picing space.

)ro0ide storage space.

)ro0ide recouping,oce, andmisce&&aneous spaces.

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Chapter 8Management of Business Logistics, 7th 

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6igure 88Warehouse Space

Re(uireents

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Chapter 8Management of Business Logistics, 7th 

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6igure 8" Principles o'Warehouse )ayout #esign

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Chapter 8Management of Business Logistics, 7th 

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Warehouse La+out andDesign

Basic needs5

4ecei0ing

Basic storagearea

:rder se&ection

and preparation -hipping

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Chapter 8Management of Business Logistics, 7th 

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Warehouse La+out andDesign

La+out and Design)rincip&es5 se one stor+ faci&ities

*here possi%&e. Mo0e goods in a straight

&ine. se the most ecient

materia&s hand&inge/uipment.

Minimi;e ais&e space. se fu&& %ui&ding height.

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Chapter 8Management of Business Logistics, 7th 

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Warehouse La+out andDesign5 )ayout and #esign

$&*ecti+es Cu%ic capacit+

uti&i;ation

)rotection

Ecienc+

Mechani;ation

)roducti0it+

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Chapter 8Management of Business Logistics, 7th 

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 Ta%&e 895 WarehouseProducti+ity Metrics

)ounds or units per da+ Emp&o+ees per unit mo0ed nits un&oaded per hour nits piced per hour nits &oaded per hour )ercentage of orders correct&+ 1&&ed

)roducti0it+ ratio F units hand&edGda+ di0ided%+ &a%or hoursGda+  Throughput F amt of materia& mo0ed through

the s+stem in a gi0en time period

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Chapter 8Management of Business Logistics, 7th 

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Materia&s <and&ing

De1nition5 Ecient short distancemo0ement in or %et*een %ui&dings anda transportation agenc+.

6our dimensions

Mo0ement

 Time

Huantit+ -pace

Coordination

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Chapter 8Management of Business Logistics, 7th 

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:%Iecti0es of Materia&s<and&ing

ncrease e@ecti0e capacit+

Minimi;e ais&e space

4educe product hand&ing De0e&op e@ecti0e *oring

conditions

4educe hea0+ &a%or mpro0e &ogistics ser0ice

4educe cost

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Chapter 8Management of Business Logistics, 7th 

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6igure 8!2 ,tiliation o' a

Warehouse.s Cu&ic Capacity/

Principles o' Warehouse )ayout#esign

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Chapter 8Management of Business Logistics, 7th 

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)acaging

nterest in pacaging is *idespread Logistics

Warehousing Transportation -i;e

Mareting )roduction Lega&

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Chapter 8Management of Business Logistics, 7th 

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 The 4o&e of )acaging

dentif+ product and pro0ideinformation

mpro0e ecienc+ in hand&ing anddistri%ution

Customer interface

)rotect product

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Chapter 8Management of Business Logistics, 7th 

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What s )acagingJ

Consumer pacaging

Mareting managers primari&+

concerned *ith ho* the pacage 1tsinto the mareting mi.

ndustria& pacaging

Logistics managers primari&+ concerned

*ith ecient shipping characteristicsinc&uding protection, a%i&it+ to *ithstand

stacing *hen on a pa&&et, cu%e, *eight,

shape and other re&e0ant factors.

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Chapter 8Management of Business Logistics, 7th 

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)acaging Materia&s

 Ta%&e 8 presents a comparison of0arious pacing materia& characteristics.

Basic considerations inc&ude5 -oft materia&s

)&astic

En0ironmenta& issues 4ec+c&ing re0erse &ogistics

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Chapter 8

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Bar Coding

-tandard marings that can %e read %+automatic or handhe&d scanners that a&&o*for &a%or sa0ing &ogistica& acti0ities for a&&supp&+ chain mem%ers.

Bar Codes contain information regarding5

=endor

)roduct t+pe )&ace of manufacture

)roduct price

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End of Chapter 8

Warehousing Decisions