Week 8 - Warehousing & Distribution Flashcards
1
Q
What is transportation?
A
Is the planning and the undertaking of the movement of goods by a carrier to points in a cost-effective manner that achieves the times and conditions specified by the shipper
2
Q
Transportation management system
A
Inbound —> Internal processing —> Outbound
3
Q
Key drivers of loading/unloading (4)
A
- Number of items
- Time
- Packaging
- Not always symmetric
4
Q
Key drivers of line haul (4)
A
- Distance
- Impacted by network
- Congestion
- Connectivity
5
Q
Features of transportation (8)
A
- Transportation entities
- Types and models
- Tracking and vehicle maintenance
- Fuel costing and impact
- Routing and mapping
- Communications
- Carrier selection and management
- Cost drivers
6
Q
What are the different transportation entities? (5)
A
- Freight carriers - e.g hauliers, trucking companies, train companies, airlines, shipping companies
- Freight forwarders - company that leases bulk space from other carriers to be resold to firms making smaller shipments
- Carriers - immediate delivery of products
- Integrators - offer a seamless (I.e integrated) end-to-end service from consign or to consignee
- Agencies - companies combine buying power to gain reduced freight transportation rates
7
Q
Features of third-party logistics (3)
A
- Holistic service provision - I.e loading, collection, unloading & delivery etc
- Improved delivery speed & reduced risk of unreliable transportation of goods
- Usage of latest freight tracking technology such as EDI, RFID satellite to keep customers informed about driver & deliveries
8
Q
Features of fourth party logistics (2)
A
- Lead logistics providers which facilitates freight sharing
- Are asset light players who take on the responsibility for logistics whilst not actually carrying out any of the physical logistics duties themselves
9
Q
Models of transportation (6)
A
- Airfreight - air transportation
- Road transformation (motor carrier, trucks)
- rail transportation
- Water transportation
- Pipeline
- Intermodal
10
Q
What are the three types of transportation?
A
- Land - I.e road, rail, pipelines
- Water - I.e cargo ships
- Air - airfreight
11
Q
Advantages of airfreight (3)
A
- Makes up lost time
- Perishable products
- Urgent deliveries
12
Q
Disadvantages of airfreight (6)
A
- Expensive
- Line-haul cost of airfreight service
- Transportation cost
- Transit time
- Increase handling costs
- Increasing loss and damage
13
Q
Advantages of motor carrier (2)
A
- Flexibility
* Ability to deliver the product
14
Q
Disadvantages of motor carrier (3)
A
- Limitations by highway weight and size
- Speed limitations and hours of service (HOS) rules
- Highway congestion
15
Q
Types of cargo ships (2)
A
- Bulk carriers - are designed to transport unpackaged bulk cargo such as cement, ore and coal
- Container ships - carry intermodal containers that can be carried by land
16
Q
Features of rail transport (4)
A
- Move commodities over large distances
- High fixed costs in equipment and facilities
- Scheduled to maximise utilisation
- Transportation time can be long
17
Q
Rail types of freight (3)
A
- Bulk unit train
- Mixed carload
- Intermodal (container, trailer and automobile)
18
Q
Features of bulk unit trains (3)
A
- Moves very high volumes of a single commodity
- Coal, grain, minerals and waste
- One way (shipper to receiver)
19
Q
Features of mixed carload (2)
A
- Moves a diverse range of commodities
* Chemicals, food products, forest products, metal auto parts, waste and scrap
20
Q
Features of intermodal (3)
A
- Moves truck trainers
- Almost anything that can be pack in a truck or container like: finished consumer goods, refrigerated foods, tools and parts for manufacturing and raw materials
- Two way
21
Q
Advantages of railroad (5)
A
- Adds transportation system capacity and reduces highway costs
- Promotes economic development, productivity and supports international trade
- More fuel efficient and generates less air pollution per ton mile than trucks
- Rail road improves safety and security by offering a naturally selected right-of-way for freight
- Reduces truck travel, congestion’s and highway costs
22
Q
Disadvantages of railroad (2)
A
- Unless a manufacturing facility has a direct connection to the railroad rest of the trip must be handles by truck
- Rail shipment sometimes cannot meet the rapid and flexible demand of an industry
23
Q
Features of pipeline transport (4)
A
- High fixed cost
- Primarily for crude petroleum, redefined petroleum products, natural gas
- Best for large and stable flows
- Pricing structure encourages use for predictable component of demand
24
Q
Reasons for warehousing (6)
A
- Achieve transportation and production economies of scale
- Take advantage of quality purchase discounts and forward buys
- Maintain source of supply
- Support the firm’s customer service policies
- Meet changing market conditions: seasonality, demand fluctuations and competition
- Provide temporary storage of materials to be disposed of or recycled
25
Roles of warehousing (4)
* Buffer
* Consolidation center
* Cross-docking
* Value-added-processing
26
Buffer - roles of warehousing:
• Typical sources/examples of system variation (2)
• Typical sources of random variation (2)
• Typical economies of scale
• Typical sources/examples of system variation:
- Product seasonalities
- Cyclical/batched production due to large setup costs
• Typical sources of random variation:
- Variation in transportation times due to weather, traffic congestion
- Variation in production times due to unreliable operations and unreliable suppliers
• Typical economies of scale involved:
- Price breaks in bulk purchasing
27
Consolidation Center - role of warehousing
• Consolidation allows to control the overheads of transportation operations by:
- Allowing the operation of the carriers to their capacity and therefore, the more effective amortising of the fixed transportation costs
- Reducing the number of shipping and receiving operations
28
Cross-docking - roles of warehousing (2)
* Consolidation without staging
| * Warehousing can be manufacturer to retailer or manufacturers to consolidator to retailers
29
Feature of Value-added-processing (VAP) - role of warehousing (4)
* Pricing and labelling
* Kitting (I.e repackaging items to form a new item)
* Light final assembly (e.g. assembly of a computer unit from its constituent components, delivered by different suppliers
* Invoicing
30
What are the two Inbound processes in major warehousing operations
• Receiving: Makes up 10% of warehouse operating costs
- Receipt of all materials coming into the warehouse
- Providing the assurance that the quality and quantity of such materials are as ordered
- Disturbing materials to storage or to other organisational functions requiring them
• Put-away (15% of warehouse operating costs):
- Determine and registering actual storage locations
- Transportation
- Placement
31
What are the outbound processes in major warehouse operations? (6)
* Processing customer order
* Order-picking (55% of warehouse operating costs)
* Checking
* Packing
* Shipping
* Others
32
Processing customer order - outbound processes in major warehousing operations
Typically done by the computerised warehouse management system of facility
33
Order-picking (55% of warehouse operating costs) - outbound processes in major warehousing operations
The set of physical activities involved in collecting from the storage area the materials necessary for the fulfilment of the various customer orders
34
Checking - outbound processes in major warehousing operations
Checking orders for completeness (and quality of product)
35
Packaging - outbound processes in major warehousing operations
Packaging the merchandise in appropriate shipping containers, and attacking the necessary documentation/labels
36
Shipping - outbound processes in major warehousing operations (3)
* Preparing the shipping documents (packaging list, address label, bill of lading
* Accumulating orders to outbound carrier
* Loading trucks (although may be the carriers responsibility )
37
Others - outbound processes in major warehousing operations (2)
* Handling returns
| * Performing the additional value added processing supported by contemporary warehouses
38
3 types of warehouses
* Public
* Private
* Other (bonded, cooperative)
39
Features of public warehouses (5)
* Serve all legitimate users
* Bonded storage warehouses (special commodities)
* A bonded warehouse (sometimes referred to as a customs warehouse) - is a warehouse tightly regulated by customs, where imported goods that are intended for export can be stored in the uk without actually entering the uk market
* Refrigerated warehouses
* Bulk storage warehouses
40
Features of Private warehouses (4)
* Owner or occupied on a long-term lease
* Offers control to owner
* Assumes both sufficient demand volume and stability so that warehouse remains full
* High fixed costs
41
Types of cargo unification (7)
* Boxes
* Pallets
* Euro pallets
* Pallet boxes
* Roll pallets
* Bags
* Injuries
42
3 types of storage policies
* Dedicated storage - every SKU gets a number of storage locations, exclusively allocated to it
* Randomised storage - each unit from any SKU can be stored in any available location
* Class-based storage - SKU’s are grouped into classes with each class being assigned a dedicated storage area, but SKUs within a class and stored according to randomised storage logic
43
What is used to determine storage equipment? (4)
* Space utilisation
* Access
* Speed of operation
* Costs
44
3 warehouse systems
* Storage racks
* Cantilever racks
* Pallet racks
45
Ways or reducing warehouse running costs (6)
* Training
* Process improvement
* Utilities management
* Use of technology
* Damage reduction
* Use of tools such as six sigma, kaizen, ABC classification
46
3 Trends in distribution centres
* Local distribution structure
* Centralised distribution structure
* Growing importance of regional distribution
47
What is the difference between warehouse and distribution centre?
- Storage
- Flow/movement of goods
- value adding activities
- data
- emphasis
* Warehouse store all products where as distribution centres hold minimal inventory and high demand items
* Warehouse: receive > store > pick > ship distribution centres: receive > pick > ship
* Warehouse have minimal value adding activities but distribution centres use many value adding activities
* Warehouses have their data in batches and have real time data
* Warehousing emphasis storage of products and distribution centres emphasis sets rapid mov,emf of products throughout the facility
48
What is cross docking?
Is the activity whereby goods are received out a warehouse or DC and dispatched without putting them away in storage
49
When is cross docking appropriate? (8)
* With perishable products requiring immediate shipment
* With high quality items that do not require extensive quality checks during receipt
* Pre-tagged, pre ticketed and ready for sale products
* Items for promotional events and initial products launches
* Products with continuous, consistent demand, such as “staple” items like milk, toilet paper etc
* Product moving from one retail store to another
* Pre-picked, pre-packaged orders from another facility
* Back-ordered items
