Chapter 9 - Logistics: Warehousing, Transportation, & Reverse Logistics
Logistics
- Logistics: part of SCM that plans, implements, and controls the efficient/effective flow
and storage of goods/services and related information, from the origin to consumption to
meet customer requirements
- Logistics is needed for:
- Inbound Logistics: move goods/materials from supplier to buyers
- Material Handling: move goods/materials between sites (internal and external)
- Outbound Logistics: move finished goods to the customer (internal and external)
- Products have little value to customers until moved to customer’s point of consumption
- Delivered at right place and right time
Warehousing
- True value of warehousing is in having right product at right place and time
- Warehousing provides time and place utility, to give materials value
- Warehouse: facility that stores purchases, WIP, and finished goods inventory
- Warehousing: function to receive, store, breakdown, repackage, and distribute
- Warehousing Management: involves number of warehouses in network, site selection,
layout, method of receiving, storing, retrieving, and distributing
- Primary Functions:
1) Receiving
2) Storage
3) Picking
4) Packing
5) Shipping (everything up until transportation, not including transportation!)
- Secondary Functions:
- Quality Inspections: incoming and outgoing
- Repackaging: for specific orders
- Assembly Operation: combines products with other items before shipping
- Ex. literature (instructions), spare parts, advertising materials. Etc.
- Warehousing robotics:
- Automated Guided Vehicles (AGVs): replace manual forklifts to move materials
- Automated Storage & Retrieval Systems (AS/RS): automate item storage/retrieval
- Collaborative Robots (Cobots): help human workers perform tasks
Warehouse Ownership
- Public Warehouses: business that provides storage and related warehouse functions on
short/long-term basis, usually on month-to-month basis fee
- Hotel for inventory
- Advantages: no capex or taxes, flexible, lower cost/risk, special features/services
- Disadvantages: incompatible computer systems, lack of needed services/space
, Chapter 9 - Logistics: Warehousing, Transportation, & Reverse Logistics
- Contract Warehouses: variation on public warehousing that handles shipping, receiving,
and storage of goods on contract basis for a fee
- Renting apartment for inventory
- Advantages: services, cost, control
- Disadvantages: duration of contract can be rather long (not flexible)
- Private Warehouses: storage facility owned by company that own goods to be stored
- Buying house for inventory
- Advantages: control, visibility, cost
- Disadvantages: high start-up cost, fixed location, fixed size and costs
Types of Warehouses
- Consolidation: receives products from different plants/suppliers and stores and combines
them with similar shipments from other plants/suppliers for further distribution
-
- Break-Bulk: divides full truckloads from single source to smaller amounts for distribution
-
- Cross Docking: logistics practice of unloading materials from incoming truck/railcar and
loading directly onto outbound trucks/railcars (barely any storage in between)
- Provides central site, consolidates, break-bulk all at one place
-
- Advantages: transportation cost savings (few FTL than bunch of LTL),
operational efficiency, inventory efficiency
Logistics
- Logistics: part of SCM that plans, implements, and controls the efficient/effective flow
and storage of goods/services and related information, from the origin to consumption to
meet customer requirements
- Logistics is needed for:
- Inbound Logistics: move goods/materials from supplier to buyers
- Material Handling: move goods/materials between sites (internal and external)
- Outbound Logistics: move finished goods to the customer (internal and external)
- Products have little value to customers until moved to customer’s point of consumption
- Delivered at right place and right time
Warehousing
- True value of warehousing is in having right product at right place and time
- Warehousing provides time and place utility, to give materials value
- Warehouse: facility that stores purchases, WIP, and finished goods inventory
- Warehousing: function to receive, store, breakdown, repackage, and distribute
- Warehousing Management: involves number of warehouses in network, site selection,
layout, method of receiving, storing, retrieving, and distributing
- Primary Functions:
1) Receiving
2) Storage
3) Picking
4) Packing
5) Shipping (everything up until transportation, not including transportation!)
- Secondary Functions:
- Quality Inspections: incoming and outgoing
- Repackaging: for specific orders
- Assembly Operation: combines products with other items before shipping
- Ex. literature (instructions), spare parts, advertising materials. Etc.
- Warehousing robotics:
- Automated Guided Vehicles (AGVs): replace manual forklifts to move materials
- Automated Storage & Retrieval Systems (AS/RS): automate item storage/retrieval
- Collaborative Robots (Cobots): help human workers perform tasks
Warehouse Ownership
- Public Warehouses: business that provides storage and related warehouse functions on
short/long-term basis, usually on month-to-month basis fee
- Hotel for inventory
- Advantages: no capex or taxes, flexible, lower cost/risk, special features/services
- Disadvantages: incompatible computer systems, lack of needed services/space
, Chapter 9 - Logistics: Warehousing, Transportation, & Reverse Logistics
- Contract Warehouses: variation on public warehousing that handles shipping, receiving,
and storage of goods on contract basis for a fee
- Renting apartment for inventory
- Advantages: services, cost, control
- Disadvantages: duration of contract can be rather long (not flexible)
- Private Warehouses: storage facility owned by company that own goods to be stored
- Buying house for inventory
- Advantages: control, visibility, cost
- Disadvantages: high start-up cost, fixed location, fixed size and costs
Types of Warehouses
- Consolidation: receives products from different plants/suppliers and stores and combines
them with similar shipments from other plants/suppliers for further distribution
-
- Break-Bulk: divides full truckloads from single source to smaller amounts for distribution
-
- Cross Docking: logistics practice of unloading materials from incoming truck/railcar and
loading directly onto outbound trucks/railcars (barely any storage in between)
- Provides central site, consolidates, break-bulk all at one place
-
- Advantages: transportation cost savings (few FTL than bunch of LTL),
operational efficiency, inventory efficiency
