WAREHOUSING & DISTRIBUTION

Warehousing and Distribution Centre Design

Warehousing and Distribution Centre Design Assessment

Introduction

This logistics activity involves management of the locations where the firm's inventories are stored. Warehouses and distribution centres are similar but have different emphasis. A warehouse is used for the storage of goods. Canned foods, for example, are canned during one month of the year at the end of a growing season and then are shipped out in a fairly even flow for the next 11 months. Or, as a contrary example, Christmas decorations are made throughout the year, but their sales are concentrated in a four- to six-week period. Distribution centres emphasize a faster turnover (or throughput) of goods. Chain grocery stores use distribution centres for receiving railcars and trucks filled with pallet loads of individual grocery products. Inside the warehouse all the products are placed in individual stacks. Then orders are “picked” from these individual stacks for each retail store. They are assembled, loaded aboard pallets, placed aboard trucks, and delivered to the stores.

The logistics of moving people may be handled in two ways. Individuals can be given instructions to meet at a certain point, nearby or far away. They then assume responsibility for making their own travel arrangements and showing up as directed. If larger groups of people are to be moved, a firm may assume responsibility and charter a bus or airplane and arrange for lodging. When the Trans-Alaska Pipeline was built during the 1970s, it was necessary to build housing for the construction workers and to continually supply them with food and other goods. On an international scale, some nations often supply the work force used in other nations. The workers are recruited in their home country and moved to where they are needed.

A distribution center offers value-added services: Rather than simply offering static storage, DCs provide a myriad of services for clients, whether those customers are external or internal company departments and functions. A well-organized and managed distribution center will provide such services as transportation, cross-docking, order-fulfillment, labeling and packaging along with whatever services are necessary to complete the order cycle, including order processing, order preparation, shipping, receiving, transportation, returned goods processing and performance measurement.

Discussion and Detailed Analysis

When considering the design and layout of a new distribution center, it's important to first consider which of the four scenarios most closely resembles your operation:

Low Activity / Low Storage Requirements. This combination represents the simple, smaller warehouse operation. Rarely are automation or sophisticated storage and picking mediums or devices justified for these smaller operations. In most instances, floor storage, stacked pallets, simple pallet racks and/or conventional shelving are utilized within the facility, along with manual handling.

Low Activity / High Storage Requirements. This combination typically calls for high bay, multi-level, high-density storage, and a random location strategy. Order picking can be manual or semi-manual (Beamon, 2006).

High Activity / Low Storage Requirements. This combination generally suggests a very condensed forward picking area supported by simple overstock ...