Traditional concept of warehouse as store or go down Development of modern concept of warehouse as facilityTraditionally, consumer maintained his own storeGradually, manufacturer visualized the need of a buffer between factory and market as productivity improvedAll activities were manual as warehouses did not receive any engineering

Post war thinking made inventory shrink and production became streamlined to demand and demand for variety in every product increased

Marketing experienced the need of a warehouse to stock products and support marketingProduction units started using the concept of warehouse as a facility to optimize production [minimize cost]

1. Protection of goods against climatic conditions. 2. Protection from theft. 3. Producers can store raw material for future production. 4. Surplus created can be stored before being finally sold. 5. Shortages in the market can be avoided. 6. Price fluctuations can be minimized. 7. International trade is not possible without warehousing. 8.Traders can keep their cargos in bonded warehouses, before they pay the duty.9.Plays important role when demand for products or the time of production is seasonal.10. Provides place for display of goods.

Retailers Warehouse/Depots • To store bulk purchases for wholesaler or producer. • Goods are packed and branded in warehouses. • Retailers can purchase goods when they are cheap and can stock excess purchase.• So that goods are always available to fill the space on shelves. Wholesalers Warehouse • Use warehouses for blending, grading, packing and branding. • Store goods from variety of manufacturers. Cash and Cary Warehouses • Retailers can buy in small quantities. • Cheap because of bulk purchases, no credit facility and no delivery.

Cold Storages • Special warehouse with refrigerating plants. • Perishable items can be stored. • Temperature can be set at will. • Insulation is done.Regional Distribution Centers • Owned and maintained by large scale retailers and wholesalers. • Located close to a good road network. • Supermarkets/multiple chains/variety chains/franchise/chain of department stores/hypermarkets mainly use regional distribution centers. Manufacturers Warehouse • Used to keep stock of finished goods and raw materials. • Help producer to carry on production when there is shortage of raw material.• Can help producer keep on production when there is less demand. • Produced can get benefit of trade discount be purchasing raw material in bulk.• Located in manufacturers production houses.

Public Warehouses • These are owned by public sector (government). • Different government agencies can stock their material. • Also available on rent to private sector. Bonded Warehouses • Are owned by government and are under the control of custom authorities.• Dutiable goods are stored, on which duty is not yet paid. • Normally located on ports. • Traders have to pay the rent. • Grading, blending, packing, branding and sub-assembly can be done. • Trader can also sell the cargo and the new owner has to pay the duties.• Nothing can be taken out of warehouse without paying duty. • Trader can pay some of the duty can get proportional amount of cargo released.• Exporting can also be done without paying duty. • It enables government to collect custom duties. • Government gets information about the types of goods imported.

Handling HoldingOrder ProcessingPackagingAdminMaintenance

Receiving goods – receive and accept responsibility Identifying goods – place, label, color code Sorting goods- sort out the received goods for appropriate storage area Dispatching goods to storage- for temporary storage with easy accessibility Holding goods- security against pilferage and deterioration Selecting, retrieving, packing- items are retrieved and grouped according to customer order for dispatch

Marshalling goods- check the items of a single order for completeness and order records are updated Dispatching goods- consolidated order is packaged and directed to right transport Preparing records and advices- of stocks and replenishment requirements

*Design criteria

product flow, ware house should be designed round material handling flow.

No of stories, one is ideal as against limitations of space, cost of land.

Height utilization, principle of cubic space, principle of ‘go vertical’, limitation on height utilization due to fire safety and insurance regulations.

*Handling Technology Movement continuity and movement scale economics.•Movement continuity is ensuring less number of long movements rather than large number of short movements.•Movement scale economies depend on movement in large bulk.• Moving material in cases strapped on pallets or containers rather than moving material in small packages.• Handling technology is addressing these issues

*Storage Plan

Characteristics of product

Open air storage for bulky products

Heavy items closer to floor

Light items on higher rungs

Fast moving items in large bulk closer to

aisles

Hazardous items

Location considerations Cost of distribution to market area Transport requirement and facilities Transport cost Competition, presence of others Availability of utilities [power, water, gas, sewerage disposal and cost] Labor supply and cost I - R climate, labour productivity Customer expectation of ‘D’ Company specific commitments Local taxation Community attitude Restrictions associated with warehouses

Economic benefits - Consolidation, Break bulk, Cross Dock, processing postponement, stock piling[seasonal storage]

Service benefits - spot stocking, Assortment, mixing, production support, market presence

Thank you