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Warehousing.

Warehousing. Part Three. Uses of Warehouses: . Support manufacturing. Mix products from multiple production facilities to a single customer. Break bulk. Consolidate small shipments into large shipments. . Logistics Concepts. S u p p l i e r. C u s t o m e r.

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Warehousing.

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  1. Warehousing. Part Three.

  2. Uses of Warehouses: • Support manufacturing. • Mix products from multiple production facilities to a single customer. • Break bulk. • Consolidate small shipments into large shipments. .

  3. Logistics Concepts S u p p l i e r C u s t o m e r Inbound Logistics Outbound Logistics . . . .

  4. Manufacturing Support (inbound logistics) Carload or truckload shipments Supplier A Supplier B Warehouse Supplier C Supplier D . .

  5. Mixing Warehouse (outbound logistics) 1 2 3 4 Customer W Plant A, Product 1 1 2 3 4 Plant B, Product 2 Customer X 1 2 3 4 Plant C, Product 3 Customer Y Plant D, Product 4 1 2 3 4 .

  6. Mixing Warehouse (outbound logistics) Customer W Plant A, Product 1 1 1 1 1 1 1 1 2 3 4 Plant B, Product 2 2 2 2 2 2 2 2 Customer X 1 2 3 4 Plant C, Product 3 3 3 3 3 3 3 3 Customer Y Plant D, Product 4 4 4 4 1 2 3 4

  7. Mixing Warehouse (outbound logistics) Customer W Plant A, Product 1 1 1 1 1 2 2 3 3 4 4 Plant B, Product 2 2 2 Customer X Mixing Warehouse 1 1 2 2 3 3 4 4 Plant C, Product 3 3 3 Customer Y Plant D, Product 4 4 4 1 1 2 2 3 3 4 4

  8. ConsolidationWarehouse (outbound logistics) Customer Plant A Plant B Customer Consolidation Warehouse Plant C Customer Plant D

  9. Breaking bulk . .

  10. BreakbulkWarehouse (outbound logistics) Customer 1 Customer 2 Breakbulk Warehouse Plant Customer 3

  11. Types of Warehousing XYZ Company Warehouse • Direct store delivery. • Private warehousing. Advantages: Disadvantages Control Fixed costs, especially if built for peak seasons. Flexibility in design and operation Long-term cost Investment. Return may be better if money is placed elsewhere. Better use of human resources. Tax benefits: depreciation. Intangibles: image of stability. . . . . . . . . .

  12. Types of Warehousing ABC Public Warehouse XYZ Company Warehouse • Direct store delivery. • Private warehousing. • Public warehousing. Advantages: Disadvantages Conservation of capital. Incompatible communications systems. Able to increase capacity when needed. Lack of specialized services.. Reduced risk of obsolesence. May be unavailable when needed. Economies of scale due to warehouse company’s investment Flexibility Tax advantages: some states have no inventory taxes for products in public warehouses. Specific knowledge of costs. . . . .

  13. Types of Public Warehousing General merchandise ABC Public Warehouse Refrigerated or cold storage Bonded warehouses. Household goods, furniture. Special commodity Bulk storage. Cross-docking facilities (3PL concept). www.frigorifer.com/images/firma.jpg Contract warehousing (can be used in 3PL). www.mwindy.com/images/frozen_pizza.jpg www.burrowsmoving.com/.../buildingoutside.jpg . . . www.ewga.net/.../ewga/finewinestorage(1).jpg . .

  14. Warehouse Characteristics • Increase the number of warehouses and the average size of warehouses decreases. • Factors influencing the number of warehouses: • Cost of lost sales. • Inventory costs. • Warehousing costs. • Transportation costs. .

  15. Warehouse Locations • Market-based – nearest the final customer. • Production positioned – collection points or mixing facilities. • Intermediate positioning between producer and final customer. Warehouse Factory Warehouse Customer

  16. Cross-docking: Movement from an inbound dock directly to an outbound dock Movement directly from an inbound dock to a sorting process to an outbound dock. Outbound Inbound Outbound Outbound Inbound Outbound Inbound Sorting area

  17. Crossdock in at least two of these conditions: • Product destination is known upon receipt. • Destination is ready for immediate delivery. • You daily ship to less than 200 locations. • More than 70% of products fit conveyors. • You receive large quantities of individual items. • Products arrive pre-labeled. • Some products are time-sensitive. • Distribution center is near capacity. • At least some inventory is pre-priced.

  18. Crossdock in at least two of these conditions: • Product destination is known upon receipt. • Destination is ready for immediate delivery. • You daily ship to less than 200 locations. • More than 70% of products fit conveyors. • You receive large quantities of individual items. • Products arrive pre-labeled. • Some products are time-sensitive. • Distribution center is near capacity. • At least some inventory is pre-priced.

  19. Crossdock in at least two of these conditions: • Product destination is known upon receipt. • Destination is ready for immediate delivery. • You daily ship to less than 200 locations. • More than 70% of products fit conveyors. • You receive large quantities of individual items. • Products arrive pre-labeled. • Some products are time-sensitive. • Distribution center is near capacity. • At least some inventory is pre-priced.

  20. Crossdock in at least two of these conditions: • Product destination is known upon receipt. • Destination is ready for immediate delivery. • You daily ship to less than 200 locations. • More than 70% of products fit conveyors. • You receive large quantities of individual items. • Products arrive pre-labeled. • Some products are time-sensitive. • Distribution center is near capacity. • At least some inventory is pre-priced.

  21. End of Program.

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