Completion
Distribution
Finally those items in the upper left hand quadrant
of the distribution generate the fewest picks per unit space they occupy and
they should be assigned positions in the bronze zone. This example is not meant
to make an end all recommendation for slotting broken case picking systems.
That depends on many other factors including the wage rate the cost of space
the cost of capital the planning horizon and so on. Instead this example is
presented to illustrate how the popularity- cube- movement distribution is used
in the slotting process. Once in place the distribution provides most of the
insights required for slotting the entire warehouse.
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Item
– Order Completion Distribution
The item- order completion distribution identifies
small groups of items that can fill large groups of orders. Those small groups
of items can often be assigned to small order completion zones in which the
productivity processing rate and processing quality are two to five times
better than that found in the general warehouse.
The item order completion distribution is
constructed by ranking the items from most to least popular. Beginning with the
most popular item then the two most popular items, then the three most popular
items and so on the items are put against the order set to determine what
portion of the orders a given subset of the items can complete.
Warehouse
operations – Centralized and De- Centralized
In a multiple warehouse the warehousing operations
can either be centralized or decentralized. In decentralized warehousing
operations each warehouse is considered as a separate entity. Thus each
warehouse will have a separate safety stock there will be orders from lower
warehouse to the upper warehouse and there will be in – transit stocks. Each
warehouse will optimize inventory individually. This type of decentralizing
will be advantageous for the following situations.
Consumption centers are located at different places
and at distant places. The transaction of goods is very high. The advantages of
such system are
·
This prevents obsolescence and also
prevents accumulation of surplus materials and
·
This offers services where it is needed.
But the system has the disadvantages of having high
running cost due to increased stock and personnel in each warehouse and due to
handling of more information. As against this in a centralized system of
warehousing operations order processing storing of safety stocks and control
stock movements will be done centrally by a central warehouse. The important
requirement for this centralized system is a well established information
system. But this system has the following advantages:
1 Orders for multiple items on a single source can
be bunched together.
2 there will be reduction in safety stock by a
factor equal to a where in is the number of warehouses.
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