What is a Warehouse & why companies need them?
All organizations hold stocks. In virtually every supply chain, gaps exist between when something is produced and when a customer is ready to buy or receive it. Stocks occur at any point in the supply chain where the flow of materials is interrupted. This implies that products need to be stored during this period of gap.
All organizations hold stocks. In virtually every supply chain, gaps exist between when something is produced and when a customer is ready to buy or receive it. Stocks occur at any point in the supply chain where the flow of materials is interrupted. This implies that products need to be stored during this period of gap. Simply put, warehouse is a building for storing goods. Most organizations arrange for stocks to be kept in warehouses. A warehouse is any location where stocks of material are held on their journey through supply chains.
Other than providing storage, warehouses also fulfill a range of commercial functions like receiving the goods, stockpiling and dispatching goods to customers; during the process also displaying goods for commercial buyers; packing, checking and labelling orders, and dispatching them.
Warehouses are used by manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc.
They usually have loading docks to load and unload goods from trucks. Sometimes warehouses are designed for the loading and unloading of goods directly from railways, airports, or seaports. They often have cranes and forklifts for moving goods, which are usually placed on standard pallets loaded into pallet racks. Apart from storage, they are used to inspect, sort materials and break bulk (taking large deliveries and breaking them into smaller quantities). They might also be used for finishing products, labelling, packaging, making products ‘store ready’ for retailers, doing other aspects of postponement, servicing vendor managed inventories, and so on.
Why we need Warehousing?
Once the goods have been manufactured, someone owns the products till they are delivered to end customers and has its money tied up in them. Hence someone needs to keep track of where those products are and protect them from damage. Warehouse enables the businesses to stockpile these goods and manage them before further distribution. Storage also includes a proper arrangement for maintaining goods from the time of their manufacturing or purchase till they are truly used. When storage is managed on a large scale and in a particular manner it is known as warehousing. Warehousing is one of the essential elements in current day business without which business is not possible.
Given below are the key benefits of the warehouse:
- Safety and Preservation of goods, preventing them from getting lost or stolen.
- Trouble free handling, reduce errors and damages in the order fulfillment process.
- Ensuring Continuous supply of products, ensuring timely delivery and optimized distribution.
- Warehouses helps price stabilization by creating time utility.
- Serve as local and regional store distribution centers and provide the facilities of packing, processing and grading of goods.
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What is the difference between Warehouse Management & Inventory Management?
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At a high level, the essential elements in a warehouse are an arrival bay, a storage area, a departure bay, a material handling system and an information management system. As part of the process for enabling a warehouse layout, you must define warehouse zone groups, and zones, location types, and locations.
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Types of Inventory Count Processes
While dealing with lots of inventory in a warehouse, lots of things can go wrong. Shipments may not have the right number of units in them, or they could get damaged somewhere along the supply chain. Discrepancies in the stock may arise as part of every inventory control, and need to be corrected immediately after the inventory control procedure has been finished.
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Before shipping, businesses need to make sure that the items will arrive in good condition. Packaging is a form of protection against environmental threats that the product will face from the time it leaves warehouse facility until the time it reached the customer. The packaging is intended to provide protection for the item as it is being handled in the warehouse or when the item is being shipped.
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When products arrive at a facility, there need to be a defined process to let them in. The process for accepting inventory when it arrives is called "Receiving". Any warehousing operation must be able to receive inventory or freight from trucks at loading docks and then stow them away in a storage location. Receiving often involves scheduling appointments for deliveries to occur, along with unloading the goods and performing a quality inspection.
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Overview of Third-Party Logistics
Third-party logistics (abbreviated as 3PL, or TPL) is an organization's use of third-party businesses to outsource elements of its distribution, warehousing, and fulfillment services. A third-party logistics provider (3PL) is an asset-based or non-asset based company that manages one or more logistics processes or operations (typically, transportation or warehousing) for another company.
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Transport operations are often divided into full load and part load and due to economies of scale, the unit costs are higher for part loads. Our customer needs several part loads delivering, so it can reduce costs by consolidating these into full loads. Then it gets all the part loads delivered to a warehouse near the suppliers, consolidates them into full loads, and pays the lower costs of full-load transport to its operations.
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When a customer wants a product that has been stored in the warehouse, the same need to be picked off the shelf (or off the floor) and get it ready for shipping. Depending on how big is the warehouse, picking can take a while. (Many distribution centers cover more than 1 million square feet.). Hence, warehouse order picking methods are an important aspect within any warehouse.
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Miscellaneous Warehouse Processes
At the end of each inventory control, the Contractor provides the Ordering Person with an inventory report which contains a list of all stock adjustments. The Ordering Person uses the report to create, by use of his/her own means, necessary value and accounting adjustments related to the stock. Let us look at some to the mislaneous warehouse processes not covered earlier.
