Chapter 5 - Warehouse Activities Flashcards
What is a warehouse?
A building for storing goods used by manufacturers, importers, exporters, wholesalers, transport business, customers, etc. They are usually large plain buildings, industrial parks on the outskirts of cities, town, or villages.
What is the difference between a Warehouse & Store?
Warehouse:
Stores products between the points of origin to the point of destination, while providing information on the cargo’s status
Store:
A place where cargo is placed for a longer time, no handling activities are performed
5 factors of warehouse site location
- Layout & Flow of Building
- Availability of Skilled Workforce
- Zoning & Intensity of Use
- Proximity to Major Linkages
- Material Handling Capabilities
How many types of warehouse are there?
7
Types of Warehouses
- Private Warehouse
- Public Warehouse
- Distribution Centre
- Government Warehouse
- Bonded Warehouse
- Licensed Manufacturing Warehouse (LMW)
- Co-Operative Warehouse
What is a Private Warehouse?
- Owned and operated by a single company
- Greater control over conditions & processes to store goods
- Great security and confidentiality
- Building & maintaining is expensive
What is a Public Warehouse?
- A storage facility offering temporary storage space to the public
- Operated by third-party logistics (3PL) providers
- Warehousing service for business that need extra space but no resource to maintain a warehouse
- Provide flexibility and value added services (Inventory management, order processing)
- Can rent as much or as little storage space
- Limited control since the space is shared
Distribution Centre
- Designed to receive, store & ship products to multiple destinations
- Act as a hub of movement of goods between suppliers, manufacturer, & retailers
- Located near major transportation hubs
- Act as consolidation point for goods from multiple suppliers
- Use advanced inventory management systems
- Provide value added services such as labeling, packaging & assembling
Government Warehouse
- Owned & operated by federal, state, or local government agencies
- Stores goods owned by the government
- Secure & controlled storage for assets such as military equipment. vehicles & supplies
- Store confiscated goods (Drugs, weapons, counterfeit merchandise)
- Store disaster relief materials (Food, water, medical supplies)
Bonded Warehouse
- Store imported goods yet to cleared through customs or goods intended for export
- Operated by customs or tax authorities
- Business doesn’t pay duties until goods are released for sale
- Allow for sale form the warehouse, generating revenue from sale and paying for delayed payment of customs duties
- Secure storage for valuable / time-sensitive goods, streamlining the customs clearance process
Licensed Manufacturing Warehouse (LMW)
- Authorized facility that conducts warehousing & manufacturing of goods, with at least 80% exports
- Import duty & sales tax exemption for raw materials, components, machinery & equipment that are new, unused, & directly used in manufacturing process
- Can import materials at a reduced cost, avoiding tax & duty
- Manufacturer with over 20% local sales must obtain approval from MIDA
- Exemption doesn’t apply to: Cranes, forklifts, staff uniforms
Co-Operative Warehouse
- Owned by multiple organizations
- Work closely together & access to coop warehouse can save money
- Common among farmers
- Reduce inventory storage cost, increase profits in the long run
- Great for business with similar inventory type
- Fairly accessible
Three basic warehouse functions
- Movement
- Storage
- Information transfer
Movement, 5 Activities
- Receiving
- Put-Away or Transfer
2.1. Direct put-away
2.2. Directed put-away
2.3 Batched or sequenced put-away - Order Picking or Cargo Selections
- Cross Docking
- Shipping or Out-Going
Storage, 3 Methods
- Fixed locations
- Random locations
- Zoning
