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Logistics and Supply Chain Management

Part II: Warehouse Logistics

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The Warehouse and the Logistics ChainWarehouse Types

Raw material Warehouses

hold raw materials near the point of induction into a

manufacturing/assembly process.

 Work in process Warehouses

hold partially completed assemblies/products along

assembly line.

 Finished Goods Warehouses

Hold inventory used to balance and buffer variation between

demand and production schedule, usually near the point of

manufacture.

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Role of the Warehouse in the Logistics ChainWarehouse Types

Distribution Centers

accumulate and consolidate products from different points of

manufacture to consolidate shipments to common

customers. Product movement is a full pallets inbound and

full/broken pallets or cases outbound.

Fulfillment Centers

receive, pick and ship small orders for individual customers.

Local Warehouses

are in the field to shorten transportation distances and permit

rapid response to customer.

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Role of the Warehouse in the Logistics Chain

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Common Warehouse Activities

Receiving Put Away

SupportFunctions

Sort & Accumulate

Storage

CrossDockFlows

ShippingOrder

Picking

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Storage Optimization in the Warehouse1. Assign each item to least cost storage mode.

Select storage mode that: minimizes cost of storage and handling for an item

(depends on item demand and dimensional characteristics, and storage mode costs)

Pallets - can choose to:

- assign a position on floor storage- single deep rack, - double-deep rack- drive in / thru rack (*)- mobile rack

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Storage Optimization in the Warehouse

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Storage Optimization in the WarehouseSmall Items - can choose:

- bin shelving

- storage drawers

- flow rack (*)

- horizontal carousels

- vertical carousels

- mini AS/RS (automated storage and retrieval system)

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Storage for Large Items / Pallets

http://www.youtube.com/watch?v=JQnOkYn0sa8

Stacking Frames

Single Deep (Selective) Rack Double-Deep Rack

Floor Storage (Stacking)

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Storage for Large Items / Pallets

http://www.youtube.com/watch?v=pNzSzO8tc24&feature=related

http://www.youtube.com/watch?v=kjmIihLiyl4&feature=related

http://www.youtube.com/watch?v=6rr6tYt2PXM

http://www.youtube.com/watch?v=VqUt7Iw3AKs&feature=related

http://www.youtube.com/watch?v=jV2zLKtoTfw

http://www.youtube.com/watch?v=diO90lex6yAhttp://www.youtube.com/watch?v=Se0nCDiMcGw&NR=1

Drive-In Rack Pallet Flow Rack

Mobile Pallet RackPallet Flow Push Back Rack

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Storage for Small Items

http://www.youtube.com/watch?v=x_70BimxB9M&feature=related

Bin Shelving Storage Drawers

Carton Flow Rack

Mezzanine

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Storage for Small Items

http://www.youtube.com/watch?v=jTo1oVEbVoY&feature=related

http://www.youtube.com/watch?v=YHcu5bukV5U&feature=related

http://www.youtube.com/watch?v=2_yXThsnSbM&feature=related

http://video.google.com/videoplay?docid=7892540209753292755&ei=3XV1S--4OJqOqgLspenhBw&q=floor+storage+systems&hl=en#

Vertical Carousels

http://www.youtube.com/watch?v=SDqyk4hhb1s

http://www.youtube.com/watch?v=kdVet_UOx30

Horizontal Carousels

Mini Load ASRS

Automated Dispensing Systems

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Storage Optimization in the Warehouse2.      Assign each item its optimal allocation of space.

Decide to create a “forward area” separate from the reserve

picking area for those items that generate a majority of pick

requests.

 

Pros:

  - short travel times to pick

- greater picking productivity

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Storage Optimization in the Warehouse3. Assign the most popular items to the most easily

accessed locations in the warehouse • A minority of the items (“A” Segment or fast movers)

generate the majority of picking activity.

• Set them in picking areas that are easiest to pick from

and yield highest picking productivity (the Golden Zone)

and at hip level.

• The most popular items to the most easily accessed

locations in the warehouse

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Order PickingHuman Work Elements include:

• Traveling to/from/between pick locations.

• Extracting times from storage locations.

• Reaching/bending to access pick points

• Document picking transactions

• Sorting items into orders

• Packing times

• Searching for pick locations

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Order PickingPicker working time distribution (typical)

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Order PickingItem-Order completion Distribution

(A few items complete a large % of the order)

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Improving Order Picking

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Summary• Logistics and Supply Chain Management Definitions

• Concept of Profiles and Data Mining

Idea: get as much information of what goes on in the supply

chain with respect to the the flow of material, information and

money, by means of data “snapshots” to discover trends and

therefore, opportunities for improvements.

• Each of the five logistics activities is quite complex.

• Requires much planning and analysis to achieve cost

effectiveness.

• Focused on warehouse and picking activities and gave some

principles

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Typical Transportation Flow and Terminology

SHIPPER pays CARRIER to transport CARGO from an ORIGIN to a DESTINATION.

CONSIGNEE receives the cargo and the payment made to the carrier is called a FREIGHT PAYMENT.

The document describing and contracting the movement of goods is called a BILL OF LADING.

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Typical Transportation Flow and TerminologyCarrier can be:

EXPRESS/PARCEL CARRIER

(FedEx, UPS)

LESS-THAN-TRUCKLOAD TRUCKING COMPANY

(Yellow Freight, Estes)

FULL-TRUCKLOAD TRUCKING COMPANY

(Schneider, JB Hunt)

OCEAN LINER

(Maersk, P & O Nedlloyd, Hanjin),

RAILROAD

(CSX, Florida East Coast, Union Pacific)

AIR CARRIER

(DHL, UPS, BAX Global or a PRIVATE FLEET)

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Typical Transportation Flow and Terminology

Cargo is housed in a CONTAINER (trailer, railcar, ocean container) for transportation.

  Moved by a MOTOR VEHICLE (tractor, locomotive,

airplane or ocean vessel).  Cargo moves between various LOGISTICS

FACILITIES (warehouses, terminals, distribution centers, ports).

  Arrangement and location of logistics facilities is

called TRANSPORTATION NETWORK.  A SHIPMENT is one or more orders traveling together.

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Video

Loading Docks

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References• Frazelle, Edward “Supply Chain Strategy” McGraw Hill 2002.

• Logistics Trends – Achieving Supply Chain Integration: Denali

Consulting