WAREHOUSING &

DISTRIBUTION CENTRE
OPERATIONS

UNIT - 4
WAREHOUSE MANAGEMENT

⦿ Warehouse Utilization Management

⦿ Emerging trends in warehousing sector
⦿ Use of Material Handling Equipment in
warehouse
⦿ Inventory Management in warehouse
⦿ Inbound & Outbound operations of a warehouse
⦿ Distribution
⦿ Definition, Need for physical distribution
⦿ Functions of distribution
⦿ Marketing forces affecting distribution
⦿ The distribution concept, system perspective
 WAREHOUSE UTILIZATION MANAGEMENT
⦿ Calculating your warehouse space utilization is a
simple process.

⦿ To determine
your warehouse space utilization you need to
calculate your inventory cube size. Do this by
adding up the volume of all the products that are
stored in your warehouse and divide that total by
the warehouse space store capacity
 WAREHOUSE UTILIZATION MANAGEMENT
⦿ Use Your Vertical Space
⦿ Look up and make sure you’re using all the vertical
space available. Investigate storage media to take
advantage of your clear span height. How much
cubic feet of vertical space is not being used? Be
sure to know how your design might impact your
sprinkler design and fire code.
⦿ Analyze Your Department Space
⦿ Identify functions that do not require high ceilings
in areas where lower stacking heights are dictated
by the clear height. We often see unused overhead
space where large departments like packing and
 WAREHOUSE UTILIZATION MANAGEMENT
⦿ Consolidate Locations
⦿ If you have multiple locations for storing the same item,
consider combining them to create better warehouse space
utilization. This can be done during the putaway process and as
a standalone function.
⦿ Right-Size Your Slots
⦿ Match the size and sales of the item to the right sized pick slot
to maximize the utilization of the picking slot cube. Having
various sizes of picking slots can facilitate this process. The
same logic applies to locations where you store reserve or
overstocks. In forward picking, keep 4-7 days of sales by SKU
to reduce replenishment.
⦿ Use Off-Site Location for Overstock
⦿ If you store a large quantity of excess inventory for a few
 WAREHOUSE UTILIZATION MANAGEMENT
⦿ Drop Shipping As An Option
⦿ If you store and ship large items, consider utilizing
some form of drop shipping to reduce your in-house
inventory and costs.
⦿ Aisle Widths
⦿ How wide are your warehouse aisles? Try to design
the minimum width required to match the material
handling equipment used without compromising
operating efficiency.
⦿ Cross Docking
⦿ If possible, consider cross docking large releases of
back orders or single-line orders to reduce the
 WAREHOUSE UTILIZATION MANAGEMENT
⦿ Best Utilization of Your Building
⦿ Make sure you study your building to determine how it can
best be utilized from a space standpoint. Consider clear
stacking height, column spacing, building impediments and
overall process flow. Try to match vertical space needs with
the building characteristics.
⦿ Depth of Storage
⦿ Review not only the effective use of the height of locations,
but also the depth of storage; for example, consider
double-depth racking.
⦿ Supply Storage
⦿ If you have to store supplies or packing materials, try to
manage the inventory to avoid overstocks. See if your
corrugated supplier can keep some inventory at its site for
 WAREHOUSE UTILIZATION MANAGEMENT
⦿ Door Use
⦿ If you have separate shipping and receiving docks, consider
combining them to save space.
⦿ Keep It Simple
⦿ Where you have a choice between a complex and simple
solution, choose the simple solution. For example, consider
adding pallet rack tiers upward. An example of complexity
could be moving racking to narrow aisles. Is there a return
on investment for your solutions?
EMERGING TRENDS IN WAREHOUSING SECTOR

Big Data

Wearable technology

The rise of autonomous machines

Cloud computing

Rethinking the warehouse itself

EMERGING TRENDS IN WAREHOUSING SECTOR

⦿ Big Data

⦿ The power of businesses to analyze massive

amounts of data is matched only by their ability to
collect it. “Big Data” is a term that refers to
massively large data sets that businesses can
analyze computationally to reveal larger patterns
and trends that might not be obvious to the human
eye.
⦿ Wearable technology

⦿ From wearable barcode scanners (on fingers,

wrists, and perhaps eventually glasses) to devices
that track movement over the course of a shift,
companies are increasingly investing in technology
that delivers them as much information as possible.
⦿ The rise of autonomous machines

⦿ Automatic guided vehicles (AGVs) are the next

step in turning warehouses into ever-more efficient
inventory management hubs.
⦿ Everything from stackers, forklifts, pallet trucks,
and even inventory-carrying robots like Kiva and
Fetch robots are revolutionizing how work gets
done in warehouses.
⦿ Cloud computing
⦿ This seems like an obvious one—so many
businesses in the modern world rely in some way
on cloud computing and applications, from work
processing to communication to the Internet of
Things. How could warehousing not be
undergoing a similar transformation?
⦿ The truth is, IoT and cloud computing meant a lot
less in previous years to warehouses than you
might think. Warehouses in many cases were
self-contained ecosystems that were primarily
concerned with what was currently on their
⦿ Rethinking the warehouse itself

⦿ Finally, it’s possible that warehouses themselves

won’t even be “in buildings.” Amazon has filed
patents for some wild new warehouse designs,
including in blimps, underwater, and underground.
Hey, what’s the use of all that good ocean water if
we can’t put our stuff in it?
USE OF MATERIAL HANDLING
EQUIPMENT IN WAREHOUSE
⦿ Material-handling equipment. Material
handling equipment (MHE) is
mechanical equipment used for the
movement, storage, control and protection
of materials, goods and products throughout
the process of manufacturing, distribution,
consumption and disposal.
What are the equipment used in material handling?
Anything that deals with the transportation, storage
and control at any stage of the processing of
materials can be classified as material handling
equipment.
Bulk Handling Material Equipment
Bucket and grain elevators
Conveyor belts
Hoppers and silos
Reclaimers
What is material handling in
warehouse?

Material handling is the movement,

protection, storage and control
of materials and products throughout
manufacturing, warehousing,
What is warehouse equipment?
The term 'material handling equipment'
encompasses a diverse range of vehicles, tools
and storage equipment. Typically,
a warehouse is used to store items, and then
move them to where they are needed. The
easier it is to move items, the more efficient
your warehouse can be.
 ITEMS TO INCREASE EFFICIENCY IN A
WAREHOUSE
⦿ Industrial Trucks
⦿ An industrial truck is a transportation device used to move items in
material handling companies. These can range from small, hand-operated
trucks to vehicular lifts. The most commonly found industrial trucks in
warehouses are as follows:
⦿ 1. Hand trucks
⦿ This is a simple, two-wheel hand-operated truck or trolley, usually with a
metallic frame and a toe-plate. Hand trucks are designed to ease the
transportation of small items. Some come in a folding variety that packs
flat when not in use.
⦿ 2. Pallet jacks
⦿ A pallet jack, truck or pump is used to transport materials that have been
stacked on pallets. These jacks have twin forks, which slide under the
pallet. The handle is then used to raise the forks with a pumping force,
creating a hydraulic action that lifts the pallet, and enables transportation.
⦿ 3. Walkie stackers
⦿ A walkie stacker is the next stage up from a pallet jack or
truck. The basic design is the same, except that the stacker is
motorized. The ‘truck’ aspect of the walkie stacker is similar
to the fork alignment and design of a forklift truck. The whole
assembly can be moved around by hand, and pallets can be
lifted to the second shelf of a warehouse stacking system.
They are ideal for small capacity items, indoor use and on
concrete floors. Walkie stackers are also less expensive than
forklift trucks.

⦿ 4. Platform trucks
⦿ A platform truck is simply a frame and platform on wheels.
The platform can be stacked by hand when a large number of
small items require transportation, or can be loaded using
another item of material handling equipment. This is ideal for
small-to-medium size operations, or as a speedy logistical
⦿ 5. Order Picker
⦿ The order picker is a small-sized forklift truck that’s
larger than a walkie stacker and is capable of bearing
more weight. Order pickers can typically retrieve and
replace stacked items from heights of between 10 – 30
feet.
⦿ 6. Sideloader
⦿ Sideloaders are used to load and unload from the side of
the machine, as opposed to the front-positioned forks of
a standard forklift. Sideloaders are best used in narrow
aisles and doorways, but they are not as maneuverable as
forklifts.
⦿ 7. AGV
⦿ The AGV is a mobile ‘robot’ that follows wires, markers
or other indicators in the floor. AGVs can also use
⦿ Bulk Material Handling Equipment

⦿ If your warehouse involves the movement of a large

number of items, then the key to efficiency is
movement in bulk. The more items you can move at
one time, the more efficiently your warehouse will run.
Here are some types of equipment that will enable you
to do just that.

⦿ 8. Conveyor belts

⦿ A conveyor belt is a motor-driven belt that forms part

of a conveyor system. Items that require transportation
are simply placed on one end of the belt, and the
⦿ 9. Stackers
⦿ A small, hand-propelled or motorized truck that’s used to lift
items off the ground and onto shelving. This is deal if you
are making the most of your warehouse space in having a
stacking system. They are cheaper to run than forklifts, and
are ideal for small-to-medium applications.
⦿ 10. Reclaimers
⦿ A machine that has a rotating scoop at one end of a conveyor
system. The scoop gathers up small, loose items and places
them on the conveyor belt. The items are then transported
along the belt until they reach their destination.
⦿ 11. Bucket elevators
⦿ Also called a grain leg, a bucket elevator is used to transport
small, loose items vertically. It is usually a motorized
device, but can be hand-cranked as well. A series of small
buckets are attached to a belt. The buckets scoop up the
⦿ 12. Grain elevators
⦿ Grain elevators are towers that contain a bucket elevator
or a conveyor. The grain is scooped up from a lower
level and safely deposited in the required storage
facility. This is ideal for large-scale operations.
⦿ 13. Hoppers
⦿ Another device for handling small, loose items, a
hopper is basically a large funnel. The items are placed
in the top of the hopper, and gravity moves them down
to the bottom, which features a narrow aperture, which
allows for flow control. The only disadvantage with
hoppers is that they can become blocked fairly easily.
⦿ 14. Silos
⦿ Silos are typically used in agricultural applications.
They are used to safely store grain, or silage (fermented
feed). They are also commonly used for the bulk storage
INVENTORY MANAGEMENT IN WAREHOUSE

⦿ Proper warehouse inventory management can be

challenging but, if you follow this useful advice, you
can increase efficiency and reduce costs.
⦿ Reevaluate your warehouse design
The layout of your warehouse should facilitate logical
inventory flow, from receiving and inspection through
to picking and packing, to ensure that operations move
quickly and smoothly.
⦿ Reorganize your stock keeping units (SKUs)

⦿ To ensure efficient operations and inventory

management in your warehouse, organize products so
that they’re easily accessible to inventory
management personnel. This principle applies not
only to your warehouse’s general layout but to your
SKUs, as well.
⦿ Invest in technology
⦿ A warehouse management system (WMS) is a good
place to start. A WMS is software designed to support
and optimize warehouse functionality.
⦿ Automate everything

⦿ One of the benefits of investing in technology is

gaining the ability to automate essential workflows,
including data collection, barcoding, scanning,
picking and packing, shipping, inventory tracking
and more.

⦿ Enable your employees

⦿ One of the best ways to improve overall inventory

warehouse management is to make it easier for
warehouse employees to do their jobs — and to do
them efficiently.
⦿ How do you organize inventory in a warehouse?
Reassess Your Warehouse Floor Plan.
Install Warehouse Racks and Shelves.
Organize Your Warehouse Inventory.
Label Everything In Your Warehouse.
Accelerate The Picking Process.
Receive Goods Efficiently.
Perform Regular Maintenance.
INBOUND & OUTBOUND OPERATIONS OF A WAREHOUSE DISTRIBUTION

INBOUND PROCESS OUTBOUND PROCESS

1. Pre Receipt
Notification,
Recording and 1. Quality Check
Tracking
2. Load Arrival
2.Sales Order
3. Bar Coded
Information:
3.Pick & Pack
4. Tracking

5.Put Away 4.Shipping

⦿ Inbound Process:

⦿ Pre Receipt Notification, Recording and Tracking:

Receipts have name of item, their quantity, Its UOM (Unit of Measurement) and
all the information related to that specific item. Serial no, Lot no, manufacturing
and expiration dates, statuses of various inventory statuses, rules of default receipt
status these elements should be tracked. For getting speedy inbound process we
need to reduce entering the information manually. Pre receipt process is regarding
automation
⦿ Load Arrival:
Most of the companies working in supply chain management plans preliminary
inbound in order to complete every Logistics Service. There is no possibility for
error as the information of all receipts is entered automatically within few minutes
like reserving docks, area to stag, advance appointments.
⦿ Bar Coded Information:
Barcoding is specifically concatenation of store and register id, date, transaction
incrementer for that specific store or register. With the help of all the data
mentioned hash function has been applied to it and it appears in the same pattern
so that all the data regarding date, store and register name kept secret.
⦿ Tracking: This includes tracking of License Plates of the trucks. RFID Insider is
used for this tracking purposes.
⦿ Outbound Process:

⦿ Quality Check:
This is one of the most important process in inbound as well as outbound. Some
products have their expiry dates. Hence this is one of the crucial part of outbound
process so that customer would be able to get best product in case of its quality.

⦿ Sales Order:

⦿ Sales order is an indication for the customer that he is ready to purchase products.

⦿ Pick and Pack:

⦿ Discrete order picking, batch picking, wave picking, zone picking, forward
picking process for TL & LTL shipments, cluster pick, paper based pick and pack
these are some picking methods used for outbound.

⦿ However in packing items are prepared for shipment by gathering them and
packaging.

⦿ Basically outbound process is related to downloading the order, its release, pick,
PHYSICAL DISTRIBUTION DEFINITION &
NEED FOR PHYSICAL DISTRIBUTION
⦿ Physical distribution involves planning, implementing and
controlling the physical flow of materials and final goods from
the point of origin of use to meet consumer needs at a profit.
⦿ Need:
⦿ Physical distribution includes all the activities associated with
the supply of finished product at every step, from the production
line to the consumers. Important physical distribution functions
include customer service, order processing, inventory control,
transportation and logistics, and packaging and materials.
⦿ i. To make available the right goods in right quantity at right
time and right place at least cost.
⦿ ii. To achieve minimum inventory level and speedier
transportation.
⦿ iii. To establish price of products by effective management of
physical distribution activities.
FUNCTIONS OF DISTRIBUTION

TRANSPORTATION

WAREHOUSING

INVENTORY CONTROL

ORDER PROCESSING

MATERIALS HANDLING

PALLATES

PACKAGING
 FUNCTIONS OF DISTRIBUTION
⦿ TRANSPORTATION
⦿ Transportation is an essential and one of the most important components of physical
distribution. It’s importance is illustrated when a strike in the road transport
paralyses a country. Not only does the movement of raw materials but also of
finished products come to a halt, and various industries and public face hardships.
Transportation expenditure is by far the most significant component of Physical
distribution.
⦿ WAREHOUSING
⦿ Warehousing is another important function of Physical distribution, particularly
when a manufacturer produces consumer goods. The optimal location of a
warehouse or warehouses, having regard to minimal transportation costs, customer
services, warehouses are some of the issues to be decided by logistics management.
Suitable locations and adequate number of warehouses maintained by and
organization can give the customer better service and can also result in reduction in
transportation costs if the goods are moved by truckloads into the warehouses.
⦿ INVENTORY CONTROL
⦿ A very high inventory level results in high carrying costs and potential obsolescence.
A very low inventory level results in high restocking and production costs as well as
the risk of lost sales and customer goodwill. The control of inventories is therefore
extremely important in the successful functioning of a firm. The total of capital costs
on inventory and transportation, storage, and inventory obsolescence must be
 FUNCTIONS OF DISTRIBUTION
⦿ ORDER PROCESSING
⦿ With the increasing acceptance of the concept of customer satisfaction, managements are
now paying more attention to order processing. Order processing is closely related to sales
and production, and the physical distribution department has to be careful about the need for
interdepartmental co- ordination. And effective information flow should begin with the
transaction of the customer order. The functions which have to effectively carried out to
ensure continuous supply of goods to the customer. It is the responsibility the physical
distribution department to analyze the order flow and introduce improved procedures,
wherever necessary, so that the customers receive the goods promptly and as and when they
want them.
⦿ MATERIALS HANDLING
⦿ An important responsibility of physical distribution department is material handling,
excluding the production line. The development of material – handling techniques in recent
years has been phenomenal. The benefits of material handling are not solely confined to the
manufacturer but to the consignee as well. In co-operation with the marketing department,
the movement of goods can be arranged in, say, pallets, so that the consignee can avoid
damages during handling.
⦿ PACKAGING
⦿ Packaging is another function of physical distribution and its cost is an important element of
the total cost of goods to the consumer. It is essential that the latest techniques and materials
of packaging be known and used. Much research has been undertaken on the subject of
packaging by container manufacturers, carriers, trade associations, and government agencies.
 MARKETING FORCES AFFECTING DISTRIBUTION
⦿ Factors Affecting Channel Distribution

⦿ Factors Related to Products:

⦿ a. Perishability of Product b. Technical Aspects c. New v/s Existing Product

⦿ d. Complexity and Risk Related to Use of Product e. Size of Product
⦿ f. Divisibility of Product g. Unit Price of Product h. Legal Aspect

⦿ Factors Related to Company:

⦿ a. Company’s Financial Position b. Product Mix of Company

⦿ c. Desire for Control d. Experience and Expertise
e. Facilities and Staff f. Company’s Past Experience:
MARKETING FORCES AFFECTING DISTRIBUTION

⦿ Factors Related to Middlemen:

⦿ a. Creditworthiness of Middlemen:
⦿ b. Attitudes of Middlemen:
⦿ c. Services Rendered by Middlemen:
⦿ d. Financial Capacity of Middlemen:
⦿ e. Terms and Conditions:
MARKETING FORCES AFFECTING DISTRIBUTION

⦿ Factors Related to Market:

◼ a. Size of Market
◼ b. Geographical Concentration
◼ c. Services Expected by Market
◼ d. Habits of Consumers
◼ e. Current Market Trend
MARKETING FORCES AFFECTING DISTRIBUTION

⦿ Factors Related to Market:

⦿ a. Size of Market:
⦿ In case of a large and concentrated market, it is
economically affordable for a company to manage its
own distribution setup. When market is small, it is
advisable to assign distribution task to middlemen.
⦿ b. Geographical Concentration:
⦿ When firm’s customers are highly concentrated (living
in nearby area) in particular region, it can directly deal
with customers by using any of the direct channels.
But, when customers are scattered in several regions, it
is not convenient to use direct channels. Middlemen
can do better job with less costs.
 MARKETING FORCES AFFECTING DISTRIBUTION
⦿ Factors Related to Market:
⦿ c. Services Expected by Market:
⦿ Number and types of services expected by the target market,
and company’s capacity and readiness to meet them are
important issues to be considered in this connection. For
example, if the market expects a lot of services, and the
company is unable and/or unwilling to satisfy them, indirect
channels are preferred to avail the services from middlemen.
⦿ d. Habits of Consumers:
⦿ Distribution channels must be fit with habits of consumers.
Manager should find out why, how, when, where and from
whom the consumers like to buy. For example, if consumers
are habituated to buy a little quantity frequently from nearby
retailer on credit, a company must involve retailers (along with
wholesalers) to avail products at all the places where
MARKETING FORCES AFFECTING DISTRIBUTION

⦿ e. Current Market Trend:

⦿ Firm’s distribution system must be compatible with the

recent market trend. Trend includes a number of
variables like policies and practices of giant national
and multinational companies, functioning of
departmental stores and corporate retailers, cyber
marketing and network marketing, business partnering
with banking, insurance, and other service providers,
customers’ awareness, and so on. Manager must
observe these reforms and innovative practices
THE DISTRIBUTION CONCEPT, SYSTEM PERSPECTIVE
⦿ Distribution is the process of making a product or
service available for the consumer or business user
who needs it. This can be done directly by the
producer or service provider, or using indirect
channels with distributors or intermediaries.