2. Table of Contents
• Warehouse and Its Need
• Warehouse Set - Up
– Warehouse Site Selection
– Warehouse Management Processes
– Warehouse Process Flow Schematic
I. Types of Material Flow
II. Types of Inspection
III. Put – Away Process
IV. Types of Storage
V. Picking and Packing Process
– Warehousing Support Needs
• Designing Warehouse
– Warehouse Site Selection and Layout Design - Understanding Business Needs
– Usual Challenges
– Designing Layout
– Parameters to be considered while designing
– Sample Layout
• Implementation
• O-Links’ Solution
3. Warehouse and Its Need
Definition – A designated place where goods are stored to balance demand & supply uncertainty, to serve
customers in much better way, to consolidate upstream flow and distribute downstream flow as per requirement,
to do last mile value addition such as packaging, kitting etc. and to reduce last mile distribution cost.
Types of Warehouses
Manufacturing Support Factory Retail Distribution Catalog Retailer
• Stock room providing raw • Serves a number of captive • Fills orders from catalog
• Interface production with
material and work in process retail units sales
wholesalers
• Advance info about order • A large numbers of small,
items to manufacturing • A Comparatively small
operations composition is needed frequently single – lines
number of orders are
• Contains many small orders • Carton and item picking is done orders are picked up
picked up on daily basis
• Only Statistical information from a forward area • Item and, sometime,
• Advance information
available about order • More orders per shift than carton picking
about the order
composition consolidation/shipping lanes • Daily compositions of
composition is required
• Stringent time requirement • High focus on cost, accuracy, orders are usually
• High focus on cost and
for response time and fill rate of the packages unknown
order accuracy
• Primary focus on response • Responsiveness depends heavily • Only statistical
• Responsiveness heavily
time but accuracy and cost on truck routing schedules information available
depends on production
also are important • The only critical point is that if • High focus is on cost and
schedules
the retails units are not captive response time
then responsiveness becomes a
crucial issue
5. Warehouse Site Selection
Key Criteria (Cost vs. Service Reliability) Additional Factors
Cost Availability of Transportation
(Warehouse
Operations Infrastructure
and
Maintenance) • Roads
• Power
• Water
• Other utilities
Availability of Skilled Manpower
Serviceability
(Proximity to
Customers or Government Regulations
Ports)
Strategic Factors – monitoring & control, pre-
determined sites, future plans
Environmental Factors
6. Warehouse Site Selection
Sample comparative analysis of possible Sites for a Customer needing warehouse closer to Port in the West Zone
Factors Zone 1 Zone 2 Zone 3 Zone 4 Zone 5
Infrastructure cost Low cost Higher as compared Higher than Very High – attributed to High cost as compared
to Zone 1 but much Zone 1 and 2 high land cost to zone 1 and 2
lower than Zone
3,4 and 5
Transportation Lowest – Close Low Very High – High High
cost (Inbound ) proximity to attributed to
port distance
Distance (Port to 0 km 17 km Inbound 100+ km 66 km 32 km
Wh.)
Connectivity Good Very good for Average Good Average
Inbound and
Outbound
Availability of Good Good – due to Average Good – due to Good
Manpower (Other warehousing hub warehousing hub
facilities)
Probable JNPT Panvel Vasai Bhiwandi Kalamboli
Locations
Here the comparison is based on few key parameters. Similar analysis can be done taking in to consideration critical
parameters, as mentioned in the earlier slide.
From the comparative analysis Zone 2 is the best option and the warehouse can be set up in this Zone to cater to
Customer requirement of having the warehouse strategically closer to the Port
8. Warehouse Process Flow Schematic
The general flow of material in the
warehouse is as depicted in the
adjacent figure
The logical flow of the process is:
1. Receipt
2. Inbound Inspection
3. Putaway
4. Storage
5. Order Picking
6. Order Sorting and Packing
7. Dispatch/Shipping
Each Process itself can be
performed in a number of ways.
For example there are numerous
ways in which the materials can be
stored – Racks, On ground, Pallets,
etc. These topics are further
explained in the following sections
Typical Warehouse Process Flow
9. Type of Material Flows: U Flow
A 'U' flow occurs when the goods receipt and dispatch functions are located at the same end of a warehouse building
Products flow in at receiving, move in to storage at the back of the warehouse, and then to shipping, which is located
adjacent to receiving area, on the same side of the building
Fast moving items are located closer to the loading bays
Advantages of 'U' Flow
Excellent utilization of dock resources because the receiving and shipping
processes can share dock doors
Facilitating cross-docking because the receiving and shipping docks are
adjacent to one another and may be co-mingled
Excellent lift truck utilization because put away and retrieval trips are
easily combined and because the storage locations are closest to the
receiving and shipping docks, they become natural locations to house fast
moving items
Yields excellent security because there is a single side of the building
used for entry and exit
10. Types of Material Flow: Straight or Through Flow
Through' flow happens when separate loading bay facilities are available for Inbound and shipping are provided, often
at opposite ends of warehouse
Products flow in at receiving, move into storage, picking area and then the staging area and despatch area in a
straight line
Items with a higher throughput level are located at the centre of the warehouse because the total distance travelled
would be shorter
The major disadvantage of a 'Through' flow layout is goods
need to travel the full length of the warehouse, even for
goods that are fast moving
It is also harder to control and less flexible
When is it better to adopt a 'Through' flow?
When there is a risk of interference or confusion between
Goods In and Goods Out
When goods inwards vehicles and dispatch vehicles are very
different; for example differences in platform height or
nature of unit load
When the warehouse is connected to a production Plant
11. Types of Inspection
Sampling
Sampling Inspection is a process in which parts of the
Inbound material is checked for consistency and expected
quality
This process is followed in case of materials, which come in
good number per batch. The underlying principle is that the
quality of a small representative parts, is good enough to
gauge the quality of the entire batch
This type of Inspection is usually used for material like
automobile components, Spares, toys, etc.
Complete Count
Complete Count is a process in which the quality of each
component/material or part coming in has to be checked for
quantity, quality and consistency
This process is followed in case of materials, which come in
small lot sizes per batch OR even if they come in large
numbers per lot, there exists no way to say that there would
be consistency of quality. The underlying principle is that the
quality of a small representative may not indicate the quality
of the whole batch
This type of Inspection is usually used for materials like
apparels, electronic products, etc.
12. Put – Away Process
The allocation of the cartons to the
Label products with Incoming date
In the Put away “Add” function, The location will also follow the logic of
to facilitate FIFO / FEFO are stuck on
Part to Location Mapping is done load clustering and rack
the carton and pallets and
based on the logic optimization and Pick balancing and
converted into palletized loads.
routing
Multiple Putaway run sheets are
The pallets and Cartons are then
In the automated system, the RF created based on the putaway
physically transported to the Stage
handhelds reflects the putaway in methodology – Batch putaway,
for Putaway location which is at end
their specific zones. Zone wise putaway for GRN clusters
of the rack columns.
etc.
Once the Putaway confirmation is
The Put away team which works in done, the material is available in the
The Pallet label is scanned and then
the rack columns puts away the ATP (Available to Promise) Stock.
the location label is scanned and
pallets and cartons to the racks,
confirmed which acts as a trigger to
Single rivet slotted angle racks as
the WMS to confirm the Putaway
per the part to location mapping in
list.
the Putaway run-sheet.
13. Types of Storage System
Drive – In Racking Pallet Racking Broad Aisle Installation
Block Stacking Push Back
14. Types of Storage System
Dedicated Storage
Product is assigned a designated slot. With multiple product storage, the space required is the
sum of the max storage requirements for each of the product
Randomized Storage
Product is randomly assigned a storage location close to the input/output point. The space
requirement will be equal to the max of aggregate storage required for the products. Dj is the
space location, Summation dkj where k=1 to m (no I/O ports )
Class-Based Storage
A mixed policy where products are randomly assigned within their fixed class. The
classification is done based on the movement of the SKU
1. The 20% items which have 80 % Storage/Retrieval activity are termed as Class A
2. The next 30% items which have 15% Storage/Retrieval activity are termed as Class B
3. The next 50% items which have 5% Storage/Retrieval activity are termed as Class C
15. Selection of Storage System
Storage System Selection through Comparative Analysis
Parameter Push Back Racks Drive Through Racks
Storage Density Offers high storage density coupled Can store large amount of inventory
with selectivity in a smaller area increasing Storage
Density
Selectivity of Inventory Ideal for selectivity – up to 400% Selectivity is sacrificed
improvement in selectivity
Type of Goods Can store a variety of inventory Ideal for large amount of similar
items (like seasonal goods) that move
quickly - Not ideal for an inventory of
wide variety
16. Picking and Packing Process
Pick List Creation
Receive shipment authorization document / label in the system
The shipment orders are sorted by customer and geography and then converted into Picklists.
There are multiple possibilities of a picklist – 1) Batch/ Wave Picks for the Bulk Pick area 2) Pick for Kitting
– Batch Picking 3) FIFO Model
The Pick Zone wise picklists are created.
The Print copy of the Picklist will also have the Carton Labels (Packing list) for full carton picks.
Batch picking is done for Kitted part IDs.
17. Picking and Packing Process
Picking
The Picks are done by reach Stacker /Retriever from the Storage area
Manual picking with Picking trolleys are used in the Slotted angle area
All completed picks are signaled by sticking the picklist to the pallet/Carton
These are then moved to the Packing Zone for further process
The carton/material is scanned along with the location scan and confirmed to complete the
activity of picking
18. Picking and Packing Process
Kitting/Rework
The batch picked materials are sorted and re-assembled.
The re-assembled materials are scanned and cartonized
The cartonized packs are then moved to the Packing line.
19. Picking and Packing Process
Packing
The cartons from the bulk pick is transferred to the Packing line for
taping/Strapping.
Picklist ID is selected and Dispatch Labels are generated and stuck to the Cartons
The loose picks are cartonized by scanning the individual material and Packing list is
created and the Dispatch labels created and stuck to the Cartons.
The high value material picked loose are shrink wrapped for safe transit.
21. Warehousing Operational Needs
Material Handling Equipment and Parking Area Policies
Men’s
Room
Fire Extinguishers CCTVs
Sprinklers
Office Space Space for Employee Needs Safety Equipments
23. Warehouse Site Selection and Layout Design (Understanding
Business Needs)
1. What is the need for the Warehouse?
2. What business is it catering to?
3. Where should the warehouse be located?
4. Is the warehouse location well connected?
5. Is there good telecommunication connection?
6. What should be the size of the Warehouse?
7. What should be the height?
8. How many bays should the Warehouse have?
9. What are the different SKUs expected to be stocked up at the Warehouse?
10. What are the markets or locations that the Warehouse would be catering to?
11. How to segregate the SKUs?
12. What should be the stocking policies?
13. What should be the replenishment policies?
14. What should be the Health and Safety policies?
15. What should be the Security arrangements?
The answer to these questions will give us a strategic perspective to the need for the Warehouse and the Layout
Design, thereafter.
24. Usual Challenges to be Handled while designing
1. Product information in terms of throughput and storage level is uncertain or not
available
2. Need to minimize the existing cost of establishing and operating the warehouse
3. Setting the Inventory Policy to store and maintain stock of Inventory of all SKUs, ready
for distribution, at all time to meet demands of all items
4. Assemble product batches prior to delivery, to stockpile critical parts, and to facilitate
regional distribution network for quick and cost-efficient delivery
25. Designing Layout
Objective
1. Ensuring Maximum utilization of space
2. Maintaining a balance between Service and Operating Cost
3. Using the most suitable unit load
4. Minimizing movement
5. Planning and controlling movement and location
6. Providing Safe, Secure and Environmentally sound conditions
Designing Basics
In case of existing warehouse
• Analyzing current and projected data on the activities in each of the areas of receiving, shipping
and inventory levels.
• The data should be supported by other considerations such as process flows, material handling
equipment, type and styles of racking equipment, special handling requirements, and personnel
In case the New Warehouse
• The designing will start for the Strategy document of the Organization and then further drill down
to the Need and possible benefits of the Warehouse
• Once this is established only then the designing of the new Warehouse begins
27. Parameters to be Planned when Designing
Material Handling Equipment Number of Docks
1. Picking Equipment • Number of Receipts and Shipments
• Static Shelving • Type of Loading and Unloading
• Carton Flow Rack • Types and sizes of vehicles
• Carousels • Number and timing of carriers
• Automatic storage and retrieval system • Different areas in which materials will be
• Automatic picking machines utilized, stored, prepared for shipment
• Pick to Light
Type of Docks
• Voice directed picking
• Automated Conveyor and Sorting systems • Saw Tooth Dock
• Straight dock
2. Receiving/Shipping Equipment • Open Dock
• Interior dock
• Conveyors
• Industrial Vehicles Location of Docks
• Automated Storage and Retrieval
Machines • Traditionally at the rear end of facility and out
• Automated Guided Vehicles of sight
• Receiving/Shipping at the same area generally
• However Multiple docks drastically reduce the
flow of material with in a facility
30. Warehouse Optimization and Simulation
Challenges Warehouse Owners Face OptiWare – Warehousing Simplified
Warehouse Space Utilization Optiware is a 3-D warehouse Design, Simulation and
Optimization product which helps you handle the warehousing
Un-optimized Layout challenges, while achieving your strategic and operational
Higher Cost of running warehouse goals.
Sub – optimal throughput in warehouse Optiware helps you in:
Challenges in implementing warehouse Processes • Optimal Layout Design
• Planning the number of MHEs and
Managing Peak hours Inbound and Outbound Material Resources
Flow • Designing the Process and
Material Flows
Resource planning • Scenario Analysis
Ensuring DIFOT ( Delivery In Full on Time)
Leading to:
Questions That Need to be Answered? • Customer Satisfaction
• Utilization of Space,
What should be the Layout Design of the warehouse? Equipment and People
• Employee Safety and
Is the Flow Streamlined?
Morale Building
How can I improve the throughput of the warehouse?
How can I plan and support multiple customers from the
same warehouse?
How is the inbound and dispatch scheduling being
Result:
planned? Economic Layout
Optimal Space
How many MHEs do I require?
Utilization
Efficient Operations
31. Thank You
Contact Us : +91 22 41232770
Email: sales@olinks.co.in
Website: www.olinks.co.in
