Warehousing including warehousing decision in detail and distribution centers

Nimisha.M.N MBA.FT Roll no.23 s3

CONTENTS
Introduction Definition of warehouse Functions of warehouse Basic warehouse decisions Distribution centers Conclusion References

INTRODUCTION

A process of transforming data into information and making it available to users in a timely enough manner to make a difference Technique for assembling and managing data from various sources for the purpose of answering business questions. Thus making decisions that were not previous possible A decision support database maintained separately from the organizations operational database

Definition of Data Warehouse?

A single, complete and consistent store of data obtained from a variety of different sources made available to end users in a what they can understand and use in a business context

Functions

Functions of warehousing include: Transportation consolidation Product mixing Cross-docking Service Protection against contingencies Smoothing

Decision Support

Data is historical or point-in-time. Optimized for inquiry rather than update. Used to manage and control business. Use of the system is loosely defined and can be ad-hoc. Used by managers and end-users to understand the business and make judgments.

Nature and Importance

Warehouse :

Accountable amount of inventory Basic functions are movement storage It saves time

Distribution centers:

More modern term. Emphasize flow and movement. Stresses rapidity of product movement. More accurately characterizes todays logistic environment.

Basic function
Consolidation Product mixing Service/Product availability Protection Against Contingencies Smoothing Manufacturing Operations

Basic Warehouse DecisionsCost Trade-off Framework

Ownership
Public versus contract versus private

Centralized or Decentralized Warehousing

How many Location Size Layout What products where

Basic Warehousing Decisions

The Ownership Decision

Public warehousing costs mostly all variable. Private warehousing costs have a higher fixed cost component. Thus private warehousing virtually requires a high and constant volume

The Ownership Decision

Factors to consider
Throughput volume Stability of demand Density of market area to be served Security and control needs Customer service needs Multiple use needs of the firm

Public Warehousing

Rationale for Public Warehousing

Limited capital investment Flexibility

Public Warehousing Services

Bonded warehousing Field warehouses

Public Warehousing

Public warehousing regulation: Liability Receipts Public warehousing rates based upon: Value Fragility Potential damage to other goods Volume and regularity Weight density Services required

Advantages of public warehousing

Conservation of capital Meet peak requirement Economies of sale Flexibility Taxes advantages Storage & Handling costs

Disadvantages of Public warehousing

Communication problem In effective communication Lack of standardization in conceptual agreement
Availability

of specialized services Space availability

Advantages of Private warehousing

Allows firms to integrate warehouse function more easily Highly flexible Less cost Organizations can make greater use of its Human Resources. Tax benefits

Disadvantages of Private warehousing

It

results in

Too

costly because of its fixed size and fixed cost Loss of valuable business opportunity Loss of customer service Loss of sales Loss of flexibility in its strategic location options

Contract warehousing
Partnership arrangement between user and provider of warehouse service Defined as Long term Mutually beneficial arrangement Provides unique and logistics services Vendor and client shares the risk associated with operation

Contract Warehousing
Up 23% per year in 2000 to $20.4 billion. Compensation for seasonality in products. Increased geographical coverage. Ability to test new markets. Managerial expertise and dedicated resources. Less strain on the balance sheet. Possible reduction of transportation costs

The Number of Warehouses

Factors Affecting the Number of Warehouses Inventory costs Warehousing costs Transportation costs Cost of lost sales Maintenance of customer service levels Service small quantity buyers

Factors Affecting the Number of Warehouses

Factor Sustainability Product value Purchase size Special warehousing Product line Customer services centralized Low High Large Yes Diverse Low decentralized High Low Small No Limited High

Distribution center

Adistribution centerfor a set ofis products awarehouseor other specializedbuilding, often withrefrigerationorair conditioning, which is stocked with products (goods) to be redistributed toretailers, towholesalers, or directly to consumers. A distribution center is a principal part, theorder processing element, of the entireorder fulfillmentprocess.

Differences between warehouse and distribution center

A warehouse is designed to accommodate long-term storage, whereas a distribution center is set up to distribute supplies: product comes in and within a week or so, the majority of it is shipped out (to stores, for instance). It's constantly moving through the building--it is received, used to fill orders and shipped out as new product is arriving.

Distribution centers are

The foundation of asupply network, as they allow a single location to stock a vast number of products A typical retail distribution network operates with centers set up throughout a commercial market, with each center serving a number of stores. Distribution centers are usually thought of as beingdemand driven. A distribution center can also be called a warehouse, a DC, a fulfillment center, a cross-dock facility, a bulk break center, and a package handling center.

Conclusion

Awarehouseis acommercial buildingfor storage ofgoods. Warehouses are used bymanufacturers,importers,exporters,who lesalers,transport businesses andcustoms. Sometimes warehouses are designed for the loading and unloading of goods directly from railways,airports, orseaports.

REFERENCES

Sunil chopra,Peter Meindl,Supply chain management,2002, 3rd edition EI,Schragenheim,H.william Dettmer,J.Wayne Paterson,Supply chain management at Wrapspeed,2009,1st edition Donald Waters,Logistics-An introduction to supply chain management,2004,2nd edition Joohn J Coyle,C.John Langely,Brain J.Gibson,Robert A. Novack,Edward J.Bardi,A logistic approach to supply chain management,2009,5th edition

http://supplychainplanning.com/?page_id=6 http://www.business.com/guides/supply-chain-distribution-7668/ http://www.slideshare.net/TheSupplychainniche/chapter-10-supply-chainstrategyppt http://www.authorstream.com/Presentation/sudhanshukhatri-243200supply-chain-management-scm-bullwick-effect-business-finance-pptpowerpoint/ http://www.authorstream.com/Presentation/khanwasif-478135-scmmaterial-planning/ http://www.authorstream.com/Presentation/khanwasif-478135-scmmaterial-planning/ http://www.authorstream.com/Presentation/nsraja_hhh-180604-marketingchannels-entertainment-ppt-powerpoint/