To understand the purpose of warehousing

Warehouse is a part of materials management process

concerned with storage to deliver on time:

Raw materials and part to manufacturing facilities for production

Finished goods to retail outlet customers and internal customer

Foam

AFF

AMF

External Customers

Internal CustomersAl Mutlaq Furniture co

AMF PROJECT

Manufacturing unit

A

CB

The purpose of any store is to provide to users or customers

The right materials

In the right quantity

At the right place

At the right Time

Receiving

Identification and sorting

Shipping

Dispatching to Customers

Retrieval from storage

Order accumulation

Record keeping

Space utilization

Every store and every storage system will be different and has to be tailor made to suit a specific purpose. A broad approach is called PQRST analysis, The letters standing for

Product Quality Route Supervision Time

The main aim of warehouse is to fulfill material

management function with:

ECONOMY SPEED

EFFICIENCY

Warehousing is not just a place to store materials and delivered. It

is now becoming strategic device or strategic concept in the entire

supply chain.

PURPOSE OF WAREHOUSE

Safety stock is the stock held by

a company in excess of its

requirement for the lead time.

Companies hold safety stock to

guard against stock-out.

Provide safe storage of inventory Information management & Compliance

A supply of inputs held as a reserve tosafeguard against unforeseen shortages ordemands. See also strategic stock.Read more:

A ratio showing how many times a company's

inventory is sold and replaced over a period. The

days in the period can then be divided by the

inventory turnover formula to calculate the days

it takes to sell the inventory on hand or

"inventory turnover days."

Comparatively large stock of essential goods or

materials, built up to withstand long holdups or

scarcity due to natural calamities, strikes, or war. In

comparison, buffer stocks are held for stabilizing

prices to protect local exporters from losses resulting

from wild swings in world commodity prices. Also

called strategic stockpiles.

Mission of a Warehouse

To protect goods

To provide a service

To ensure a steady supply

To facilitate Just In Time (JIT) delivery of finished goods for internal and external

customers. To facilitate quick response to customers demand

In today's competitive business scenario, Warehouses are strategic tools delivering

customers satisfaction and contributing to the bottom - line of manufacturers and

distributors. To can improve productivity by delivery materials on the time to customers or users. It can also manage the materials requirement as per company policy

To Keep Records

Order Fulfillment

Right Product

Good Shape

Right Package

Right quantity

At the right time

Delivered to Right Customer

Information management and documentation of the warehouse internal component

of warehouse.

Warehouse Activity

MARSHAL RHE SHIPMENT

REPACKING AND SHIPMENT

REPLENISMENT

CUSTOMER SERVICE

COMPLIANCE DOCUMENTATION

MANAGE INFORMATION SYSTEMS AND REPORTING

CROSS DOCKING

SORTING / CONSOLIDIATION

PICKING GOODS

HOLDING GOODS

DISPATCH GOODS TO CUSTOMERS

RECEIVE GOODS REPACKING

PUTWAY IDENTIFY GOODS

PERFORMANCE OF WAREHOUSE

COULD BE MEASURED FOLLOWING HEADS

ORDER FULFILLMENT

INVENTORY MANAGEMENT

WAREHOUSE PRODUCTIVITY

TRANSPORTATION PERFORMANCE

CUSTOMER SERVICE COMPLIANCE

ORDER FULFILLMENT MEASURES

ON TIME DELIVERY

ORDER FILL RATE

The rate at which customer orders can be filled fromexisting inventory within the parameters of the orderrequest. For example, if a customer places an order for10 units of a product, but the current inventory onlyallows for the immediate shipping of 7 units. The fillrate is 70%. A higher fill rate is usually equated tohigher customer satisfaction.

ORDER ACCURACY LINE ACCURACY

ORDER CYCLE TIME PERFECT ORDER COMPLETION

COMPLETENESS OF DOCUMENTATION

INVENTORY MANAGEMENT MEASURES

Inventory Accuracy

Damaged Inventory

Days On Hand

Storage Utilization

Inventory Visibility

Dock To Stock Items

Accuracy of right time delivery

Documentation

Traceability and inventory tracking

Warehouse Productivity Measures

Orders per Hour

Lines per Hour

Items per Hour

Cost per Order

Cost as % of Sales

Accuracy of picking and put way

Transportation Performance Measures

Warehouse and logistic go hand on hand

On-time Deliveries

Damage

Demurrage Cost Percentage

Freight Bill Accuracy

Cost per Order

Missed Appointments Percentage

Shipment Tracking

SUMMARY

Warehouse is an integral part of the supply

chain as well as consumer

It is not just a Warehouse, It is a strategic tool

in the material management process

It provides several value added services that

enable good customer service leading to an

improved customer satisfaction

What is Logistics?

For an example, in day to day we do transportation. Finished goods Inventory move from place to

place. For example we want to dispatch finished goods items to Riyadh or Jeddah . What do we do?

We arrange the container or trailer, Man power and materials handling equipment ,well in advance.

Finished goods items Move from our warehouse to container or trailer. Then, Finished goods items

will reach to Riyadh.

For which we need to do lot of planning. Like arrange Container or trailer well in advance, arrange

man power, Materials handling equipment etc. All these activities are called planning activities.

When we incorporate the planning activity into transportation, this will become logistics.

So when we are into logistics, we do a little bit of management activity. That is called the

Logistics Management. The definition of Logistics Management-It is the process of

planning, implementing, controlling.

Effective flow of goods, services, information from the point of origin to the point of

consumption and it will be with respect to two people. One the service provider,

another one service utilizing person, that means our customer. So for a service

provider it should be efficient. For a customer it should be effective.

Assuming I am a service provider, meaning that I need to do the activity very

efficiently. Then only my customer will use my service effectively. So the process of

planning, implementing, controlling. Effective flow of goods, services, related

information from the point of origin to the point of consumption, efficient and effective.

Above all the purpose of transportation or logistics to satisfy our customer’s

requirement. So what is that we are trying to do in the whole process? We take the non-

value added activity of our customer, convert into a value added activity give it back to

them by way of domestic logistics or international logistics. Or domestic transportation

or international transportation.

Goods Services

Information

Point of origin Point of consumption

Logistics management is that part of the supply chain process that PLANS , IMPLEMENTS,and CONTROLS the efficient flow and storage of goods and services and related informationfrom the point of origin to the point of consumption in order to meet customerrequirements

Warehouse Management

Manufacturing unit

Delivery

CreatedCarrier

Assigned

Delivery

Manifested

Vehicle

allocated

Delivery

Dispatch

Delivery

Confirmed

custo

mer

Service

Utilizing

Service provide

Efficient

Effective

Effective flow of goods, services, related information from the point of origin to the point of

consumption, efficient and effective. Above all the purpose of transportation or logistics to satisfy our

customer’s requirement. So what is that we are trying to do in the whole process? We take the non-

value added activity of our customer, convert into a value added activity give it back to them by way of

domestic logistics or international logistics. Or domestic transportation or international transportation.

point of origin

services

Effective flow

of goods

point of

consumption

Warehouse Management

Service provide

Efficient

customer

Effective Service

Utilizing

custo

mer

non-value added

activityconvert

value added

activity

logistics

Order processing

Customer Order Processing

Transportation

Manufacturing Unit

Warehouse

Customer

Logistics Activity

Logistics plans implements and Controls

the efficient, effective forward and reverse

flow and storage of goods , Services, and

related information between the point of

origin and the point of consumption in

order to meet customers requirement’s

Logistics

Materials

Customer

Warehousing

Plant

Satellite

Distribution

PLANT - A

PLANT - C

Functions of a Warehouse

PLANT - BCONSOLIDATION

WAREHOUSE

FACILITY - A

FACILITY - B

FACILITY - C

CONSOLIDATIONWAREHOUSE

CONSOLIDATION WAREHOUSE

WAREHOUSE

PRODUCTION COUNTRY

IMORTER

consumers

COMSOLIDIATION WAREHOUSE

Consolidation Warehouse

The consolidation warehouse and consolidation

materials from a number of facilities for delivery to

a specific customer location on a single

transportation shipment.

BenefitsThe primary benefit of consolidation is that it

combines the logistical flow of several small

shipments to specific destination.

Break Bulk Warehouse

PLANT - A BREAK BULK WAREHOUSE

CUSTOMER P

CUSTOMER Q

CUSTOMER R

Break bulk warehouse help in ensuring that the

economical large bulk transportation from the origin

is split into smaller sized shipments for local

deliveries.

PLANT - A

PLANT - B

PLANT - C

BREAK BULKWAREHOUSE

BREAK BULKWAREHOUSE

CUSTOMER -D

CUSTOMER -E

CUSTOMER -F

Break Bulk Warehouse

COST OF LOGISTICS MANAGE BY BREAK BULK WAREHOUSING. ALTHOUGH BREAK BULK WAREHOUSE RECEIVED COMBINE SHIPMENT.

Cross-docking

Cross docking is a practice in logistics :-

Unloading materials from an incoming vehicle and loading materials directly in to

outbound vehicles with little or no storage in between.

Why Cross DockingTo change type of conveyance

To sort materials intended for different destinations

To combine materials from different origins

Cross Docking LTL IndustryIn LTL (Less than Truck Load) Trucking industry cross docking is done by moving

cargo from one transport vehicle directly into another transport vehicle ,with

minimal or no warehousing.

In retail practice, cross docking operations may utilize staging areas where in bound

materials are stored consolidated and stored until the outbound shipment is complete

and ready to ship.

WAREHOUSE

RECEIVE ALLOCATE MOVE OR PICK RECEIVE

Cross-docking

When Is Cross Docking Used ?The process of cross docking will not suit every warehouse’s needs. It is therefore

important to make an informed decision as to whether cross docking will increase

the productivity, costs and customer satisfaction for your specific business.

Cross docking can advance the supply chain for variety of specific products.

Unpreserved or temperature controlled items such as food which need to be

transported quickly can benefit by this process.

Packaged and sorted products ready for transportation to a particular customer

can become a faster and more efficient process through cross docking.

REASONS FOR CROSS DOCKING Provide central site for products to be stored an similar products combined to be

delivered to multiple destinations in the most productive and fastest method.

Combine numerous smaller product loads into one method of transportation to

create an easier delivery process to the customer.

RECEVEING

SORTING

SHIPPING

SUPPLIERS

CUSTOMERS

DISTRIBUTION CENTER

BEFORE CROSS DOCKING

SUFFLIERS

LTL

CUSTOMERS

FTL

FTL

CROSS DOCKING DC

AFTER CROSS DOCKING

Processing Warehouse

Benefits

Re packing /Labeling can be done at warehouse and shipped only

when the order arrives

First, risk is minimized because final packaging is not completed until

an order for a specific label and package has been received.

Second, re required level of total inventory can be reduced by using

the basic production (Bright) for variety of labeling and packaging

configurations.

Stock pilling

The economic benefit of stock pilling comes from the need of seasonal

storage. Stockpiling provides an inventory Buffer, which allows

production efficiencies within the constraints imposed by materials

sources and the customers.

EXTERNALSUPPLIER

AMF FACTORY

AWF FACTORY

AFF FACTORY

AMF CENTRAL WAREHOUSE RIYADH

AMF WAREHOUSE DAMMAM

AMF WAREHOUSE JEDDAH

STORE

Showroom Customers

Showroom Customers

Showroom Customers

Logistics Service Providers

SUPPLY CHAIN AND LOGISTICS MANAGEMENT

LOGISTICS MANAGEMENT

PLANNING IMPLEMENTING CONTROLLING

SERVICE BENEFITS OF A WAREHOUSE

Spot Stock Assortment MIXING Production Support Market Presence

Spot Stock

Assortment

Under spot stocking a selected amount of a “company’s product “like is placed

or “Spot Stock” in a warehouse to fill customer orders during a critical

marketing periods.

An assortment warehouse stock product combinations in anticipation of

customer orders

MIXINGWhen plants geographically separated overall transportation charges and

warehouses requirements can be reduced by mixing

Production Support

Production support warehousing provides support of components and materials

to assembly plans.

Market Presence

The market presence factor is based on the perception or belief that local

warehouses can be more responsive to customer needs and offer quicker

delivery than more distant warehouse.

WAREHOUSING FUNCTIONS LIKE :- Consolidation, Break

Bulk, Cross Docking , Deliver economies of scale in storage and

transportation domain resulting in improved delivery performance in

the value chain.