Storage

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Storage

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Storage & Handling Systems Reasons for Storage Reduce transportation production costs Coordinate supply and demand Assist in the production process Assist in the ... – PowerPoint PPT presentation

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Title: Storage


1
Storage Handling Systems
2
Reasons for Storage
  • Reduce transportation production costs
  • Coordinate supply and demand
  • Assist in the production process
  • Assist in the marketing process

3
Storage System Functions
  • Holding
  • Consolidation
  • Break-bulk
  • Mixing

4
Consolidation Warehouse
10,000 lbs.
Manufacturer A
10,000 lbs.
Manufacturer B
40,000 lbs.
10,000 lbs.
Consolidation Warehouse
Retailer
Manufacturer C
10,000 lbs.
Manufacturer D
5
Break-bulk Warehouse
LTL
Low rate TL shipment
Customer A
LTL
Distribution Warehouse
Manufacturer
Customer B
LTL
Customer C
6
Distribution Warehouse used for Product Mixing
Product A
Manufacturer A
Products A, B, C
Customer X
Product B
Manufacturer B
Distribution Warehouse
Product C
Products A, B, C
Customer Y
Manufacturer C
7
Materials-Handling Functions
  • Loading Unloading
  • Movement to and from storage
  • Order filling

8
Storage Alternatives
  • Space Ownership
  • Rented Space
  • Leased Space
  • Storage in Transit

9
Advantages of Space Ownership
  • Less expensive warehousing than renting or
    leasing (especially if have high utilization of
    the space)
  • Higher degree of control over warehousing
    operations
  • May be only practical alternative if products
    require specialized personnel or equipment (i.e.,
    pharmaceuticals)
  • Benefits from real estate ownership
  • May use space for other purposes in the future
  • Space may serve as base for sales office, private
    fleet, or purchasing department

10
Renting Space in Public Warehouses
  • 6 most common types of Public Warehouses
  • Commodity warehouses
  • Limit services to storage handling of
    commodities that spoil easily (lumber, cotton,
    tobacco, grain, etc.)
  • Bulk storage warehouses
  • Store handle bulk products (i.e., liquid
    chemicals, oil, syrups, etc.). Also mix products
    break-bulk as part of their service)
  • Temperature-controlled warehouses
  • Regulate temperature humidity in the storage
    space.

11
Renting Space in Public Warehouses
  • 6 most common types of Public Warehouses
  • Household goods warehouses
  • Specialize in storage handling of household
    items and furniture.
  • General merchandise warehouses
  • Most common type. Store merchandise that does
    not require special facilities or special
    handling
  • Miniwarehouses
  • Small warehouses having unit space from 20 to 200
    square feet. Often grouped in clusters.
    Intended as extra space hence, few services
    provided.

12
Advantages of Public Warehouses
  • No fixed investment
  • Lower cost if utilization of private space would
    be low
  • Location flexibility

13
Leased Space
  • Intermediate choice between short-term space
    rental in public warehouse and long-term
    commitment of private warehousing.
  • Typically can achieve lower rate in leasing than
    in renting the space
  • Lose some location flexibility since lease
    contract will be for specified period of time
  • Leasing might offer the opportunity to have
    control over the storage space

14
Storage in Transit
  • Refers to the time that the goods remain in the
    transportation equipment during delivery
  • Requires coordination between owner of the goods
    and provider of the transportation service
  • May reduce or even eliminate the need for
    conventional warehousing
  • Attractive to firms dealing in seasonal
    merchandise or shipments over long distances

15
Materials-Handling Considerations
  • Load Unitization
  • Palletization
  • Containerization
  • Space Layout
  • Storage
  • Order picking
  • Storage Equipment Choice
  • Racks, shelf boxes, bins, U-frames
  • Movement Equipment Choice
  • Manual equipment
  • Power-assisted equipment
  • Fully-mechanized equipment
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