Download Warehousing

Warehousing
Storage
(Location)
Balancing act
Warehousing
• An act of storing and assorting the finished
goods so as to create maximum time utility
at minimum cost
• Sub function – Storage, movement,
assorting, hold, consolidation, break bulk,
packing,
Advantage of Warehousing
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Serves as safeguard
Make provision for unloading
Serves economically at lower prices
Helps in determining the channel of distribution
Assist in maintaining continuous sales
Balancing demand & supply
Stabilizing prices
Reduces need for instant transportation
Warehouse Operations
• Receive and Inspect Goods
• Identify Goods
• Sort and Dispatch Goods
to Storage
• Hold Goods
• Recall, Select, or Pick Goods
• Organize the Shipment
• Dispatch the Shipment
• Prepare Inventory Records
Warehouse
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Types of warehouses
• A. On the basis of place of necessity
Inplant warehousing
Field warehousing
Bonded warehouses – located near ports
• A. On the basis of ownership
Private
Public
Contract
Types of warehouses
• Special warehouses
General merchandise warehouses
Special commodity warehouses – require special treatment
Refrigerated
Yard & ground storage
Types of warehouses
• On the basis of operation
Centralised
Decentralised
Warehouse site selection factor
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Infrastructure
Market
Access
Primary transportation cost
Availability
Product
Regulation
Local charges
Transportation
• The movement of products from where they
are made to where they are used
• Involves loading & unloading of productd
• Confers time & place utility
Modes of Transportation
Rail
Motor
Air
Water
Pipeline
Modes of Transportation
• Rail
Merits
 mass movement of goods
 Faster than road transport
 Convenient for long distance
 low unit cost
 Suitable in carrying heavy goods
 Operation less affected by adverse condition
Demerits
 Lesser accessibility
 Relatively expensive for short distance
 Inflexibility
 Not suitable for local transport
 Involves heavy losses of life in case of accident
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Roadways
• Merits
 point-to-point service
 flexible
 Safety
 Cheapness
 Perishable goods at faster speed for short distance
• Demerits
 Flexible
 Irregularities
 Limited carrying capacity
 Heavy goods in bulk involves high cost
 Slow speed
 Affected by adverse weather condition
Modes of Transportation (Cont’d)
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Water
• Merits
 lowest costs, for bulky goods
 large capabilities
 mass movement of bulk commodities
 International trade
 Cost of maintaining & constructing routes is low, naturally
made
 Safe mode with respect to occurrence of accidents
• Demerits
 Low speed
 Seasonal
 Not suitable for perishable goods
 Affected by weather conditions
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Airways
• Merits
 fastest for long distances
 broad service range
 Useful in non accessible area
 Most convenient during calamities
• Demerits
 High cost
 Limited product
 Not suitable for heavy & short distance
 Heavy losses in case of accidents
 Affected by adverse weather condition
Modes of Transportation (Cont’d)
• Pipeline
• Merits
mass movement of liquids and gasses
Economical
Un-interrupted service
No damage
Underground
lowest operating cost and unit costs
• Demerits
Pipeline
Initial heavy investment
Danger of enemy attacks
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Combination Of Modes
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Piggy - back
Fishy - back
Air - Truck
Roll on – Roll off
Transportation modes for various
products
Comparison of various modes
Importance of transportation
• Confers time & place utility on products
• Where production location & markets are
distanced transpn helps
• Help to build clientele
• Widening the markets
• Increase in mobility of labor & capital
• Stabilization of prices
• Service to customer & rise in std. of living
• Facilitates production
Main Task In Transportation
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Assessment of the transportation
Choosing the mix of transport modes
Deciding the routing
Development of operational plan
Implementation
Control of transportation cost
Managerial Aspect of Transportation
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Deciding mode of transportation
Cost
Speed
Handling damages
Regularity
Flexibility
Factor Affecting Transport Choice
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Product
Packaging
Distance
Monetary resource availability
Urgency
Lead time
Choice Of Transportation Modes
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Speed
Dependability
Availability
Costs
Inventory
• Refers to a stock of goods or other economic resources
that are held by firms at a particular time for future
production requirements & meeting demands
• Inventory can be direct or indirect – Direct includes goods
in manufacturing of product & become part of finished
goods. Ex. Raw material, WIP goods, finished goods
• Indirect include goods that are necessary to run
production process not part of end product. Ex.
Lubricants, oil, grease, stationary
Objectives Of Inventory
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To improve customer service
To reduce investment in inventories
To increase productivity
To optimize space required for inventory
To rationalize material movements
To reduce losses due to obsolescence,
deterioration