ALKESH DINESH MODY

INSTITUTE FOR FINANCIAL &

MANAGEMNT STUDIES
TYBMS
SEM V
DIV A
SUBJECT – LOGISTICS MANAGEMENT
TOPIC – MATERIAL HANDLING AND PACKAGING
SUBMITTED BY –

ASHWATI BAHSI - 04

SONALI CHAUHAN- 10

KRITY DUBAL-

KOMAL JAIN- 32

KIMAYA KLKARNI - 50

SUBMITTED TO – PROF SANJEEV THAKUR

DATE : 29/07/2010

UNIVERSITY OF MUMBAI
DEFINITION OF MATERIALS HANDLING

“Material handling is the art and science involving the moving packaging and storing of
substance in any from” OR

“Material handling is the science of movement handling and storage of materials during
different stages of manufacturing considered as material flow into, through and away from
the plant. It is fact the techniques of getting the right goods safety to the right place at the
right time and at the right cost.”

ROLE OF MATERIAL HANDLING IN LOGISTICS

In the past several years, material handling has emerged as a new and complex science
evolving rapidly. For moving the material in and out of warehouse, various kinds of
equipment and systems are used depending up on the type of products and volumes to be
handled. These equipments are used for the movement of goods over a short distance for the
purpose of loading and unloading operations. Material handling in warehouse is restricted to
unitized form, which requires smaller sized equipment. However, for bulk handling material
at logistics nodes, such as shipyards, ports and airports, different types of equipments are
used. In warehouse, the material handling operation is performed at the following stages:

1. Unloading the incoming material from transport vehicles;

2. Moving the unloaded material to the assigned storage place in the warehouse;

3. Lifting the material from its storage place during order picking;

4. Moving the material for inspection and packing;

5. Loading the packages, boxes or cartons on the transport vehicles.

Efficiency of the material handling equipments adds to the performance level of the
warehouse. The internal movement of goods has a direct bearing on the order picking and
fulfilment cycle. The warehouse is considered more labour intensive, if the material handling
equipments are more sensitive to labour productivity than the manufacturing. There is much
scope to reduce the labour and enhance the productivity by using the emerging technologies
in material handling. A good material handling system will definitely enhance the speed and
throughput of the material movement through the supply chain.
FUNTIONS OF MATERIALS HANDLING

The most important functions of material handling are:-

1. The movement of bought-out materials, tools, spares parts, suppliers, consumables

and positioning them for the purpose of change.
2. The internal movement of materials from the stores to the production floor for
processing.
3. The movement of semi-finished goods from one machine to another for carrying
out the manufacturing operation, from the work centres to inspection areas and from
one production department to another until all operations are carried out and then
moving the finished items to the assembly lines.
4. The movement of finished goods from the productions department to finished goods
stores.
5. Unloading materials from transport carriers at the inward goods stores and moving
them to the receiving by in the stores and to the inwards goods inspection areas.
6. Moving finished goods from the finished goods stores to the packing and shipping
and then transporting the packed goods to their destination (warehouse or customer
premises).
OBJECTIVES OF MATERIALS HANDLING:

Even though the best solution to the materials handling problems is no handling, it is
hardly practicable in a manufacturing process. Hence, the main objective of material handling
equipments and reducing the distances through which the materials handling equipments and
reducing the distance through which the materials are handled.

The following may be considered as other objectives of material handled.

1. Lower unit materials handling cost.

2. Reduction in manufacturing cycle time through faster movement of materials and by
reducing the distance through which the materials are moved. Reduction in
manufacturing cycle time result in reduced work-in-progress inventory costs.
3. Contribution towards a better control of the flow of materials through the
manufacturing facility.
4. Improved working conditions and greater safety in the movement of materials.
5. Contribute to better quality by avoiding damage to products by inefficient handling.
6. Increased storage capacity through better utilization of storage areas.
7. Higher productivity at lower manufacturing costs.

PRINCIPLES OF MATERIAL HANDLING:

These are also guide lines for materials handling design and cost reduction. Materials
handling principles can be basically grouped into five categories:

• Planning principle
• Operating principles
• Equipment principles
• Costing principles
• General Principles
1. PLANNING PRINCIPLES:

Material handling should be planned and well integrated with production activity to
obtain maximum overall operating efficiency.

a) Plant layout principle: “Good plant layout and minimum materials handling
are akin to each other”. Only a good layout can ensure minimum materials
handling and as such all studies relating to problems of materials handling
should be preceded by study of the plant layout.
b) Delegation of responsibility principle: “Efficiency in material handling result
when it is recognized as an important function and given equal weight age to
that of other costs centres”. The responsibility of material handling activity
should be assigned to separate department.
c) Minimization of re-handling principle: “Re-handling ads to the cost, increases
spoilage and leas to waste movements” materials must be moved directly to
the point of use. Materials must be kept at the height at which they are to be
worked upon. Materials which required sorting later should not be mixed
initially.
d) Space saving principle: “Storing space is best measured in terms of cubic
contents.” Material should not be made to spread on the floor since it occupies
more space and increases transportation distance. Pallestisation and stocking
of materials reduces requirement of space

2. OPERATING PRINCIPLES:

a) Unit load handling principle: “Material handling cost is inversely proportional

the size of the load.” It implies packaging of several pieces on a skid, pallet or
platform for movement as a single unit.
b) Gravity Principle: “Gravity is the most economical motive force. Materials
wherever possible, should be moved using this nature’s greatest resource.”
 Materials wherever possible should be made to roll or slide down the chutes to
the net work station instead of carrying or pushing it.
c) Flow of materials principle: “Materials handling efficiency is the greatest
when it approaches a steady flow of materials, over as straight path as
possible, with minimum of interruption and minimum of back tracking.”
Materials should be made to move to move over straight path as possible as it
cuts down distance. Re-handling and criss-cross movements should be
avoided.

3. EQUPIMENT PRINCIPLE:

a) Mechanization principle:” Mechanization of materials handling generally

increases efficiency and economy in handling “. The use of mechanized
equipment instead of manpower reduces handling cost, increases speed of
handling, cuts down accident improves safety reduces fatigue of the workers
and improves productivity.
b) Terminal time principle: “Reduction in terminal time of handling equipment
increased efficiency and economy of the equipment “. Waiting time of the
equipment at the pick up and put down points should be reduced to its
minimum by cutting loading and unloading time.
c) Dead weight principle: “Economy of the equipment is directly proportional to
the ratio of the load handled to the dead weight of the equipment.” To improve
efficiency of the material handling equipment.
d) Standardization principle: “Standardization of materials handling equipment
increase efficiency and give economy in the operation of the equipment.”
permits inter changeability between departments.
e) Maintenance principle: “Systematic maintenance increases efficiency and
productivity of materials handling equipment.” Repairs and replacements must
be anticipated. Preventive maintenance programmed should be implementing
for all key materials handling.
f) Speed principle: “Economy in material handling increases with efficiency and
speed of material handling.”
 g) Versatility principle: “Economy in materials handling is obtained by use of
equipment and is capable of variety of applications.” Equipment with variety
of uses should be preferred.
4. COSTING PRINCIPLES:
a) Equipment selection principle:” selection of the most flexible equipment after
through study of the items and materials to be moved increases efficiency of
material handling”. Selection of material handling equipment is vital decision.
b) Replacement principle: “Material handling cost is the lowest if the equipment
is used only for its economic retentive period and is replaced by an alternative
based on engineering economic principles”. Retaining equipment beyond its
economic period increases repairs cost and causes production hold ups.
c) Handling cost appraisal principle: “Periodic analysis of materials handling
costs highlights the areas of improvements.”

5. GENERAL PRINCIPLES:
a) Safety principle: “Materials handling efficiency increases as working
conditions are made safer and safer.” Hot materials must be handled carefully.
Operators must be well-trained to handle equipments. Safety regulations
should be strictly adhered.
b) Training principle: “Training of workmen in good materials handling
techniques and system and educating them towards importance usually helps
right attitudes of materials handling.”
c) Identification principle: “Materials must be kept identified by labelling on
pallets and boxes.” This is important failing to which unlabelled boxes will be
opened to look for what they contain especially when certain materials
required are not traceable.
d) Location principle: “All handling equipments must be placed at the right place
and at the right time to avoid hunting and delays in material handling.” There
should be a place for everything is it a trolley, helper, truck or any other
equipment.
e) Material treatment principle: “All types of materials should be trade as
important since materials handling costs are not related to the costs of
materials.” Scraps and end materials are as important as production materials.
TYPES OF MATERIAL HANDLING EQUIPMENT AND SYSTEMS

The major criteria for selection of the right system are units moved per hour and the distance
of the movement covered. Higher volumes moved over a large distance call for more
sophisticated systems, which attract higher investment.

MANUAL SYSTEM

Manual system is the cheapest and most common method of material movement used in
warehousing. In warehouses where cartons are weighing not more than 20kg and volumes
handled are not too large, material loading, unloading and movement are done manually. In
developed countries where manual labour is scarce and cost of employment is very high, use
of manual handling is discouraged. But in developing countries because of availability of
cheap labour, the manual systems with very limited mechanisation such as use of manual
push-pull trolley with wheels are common.

MECHANISED SYSTEM

The prime consideration before going in form of mechanized material handling system is
the layout of the warehouse. The investment in the material handling system will be a total
waste if it is not compatible to the warehouse lay out plan. One of the important benefits of
mechanization is to transfer the fatigue from human to machine.

The criteria for choosing a machine for material movement in the warehouse should be:

• Improving space utilization

• Reducing the time for material movement

• Speeding up the overall material flow

• Reducing the material damages

• Should be safe for human beings to operate

The mechanized systems include a large variety of handling equipments. The equipments that
are most commonly used are:

Wheeled trolley

The simplest mechanized handling equipment is a trolley on the wheels. The hand held
trolleys are efficient for handling small volumes over a short distance. For higher volumes
and longer distances, use of powered trolley is preferred. Trolleys are available in wider
range to carry the operator while some require the operator to walk along with the trolley.

Forklift truck

Forklift trucks are the work horse of the warehouse, most commonly used for
movement of unit loads such as pallets, containers and slide plates. They are the most
versatile material handling equipments used in the warehouse; they are also reliable and
relatively easy to operate. The main advantages of forklift trucks are:

• Moving larger loads over a longer distance

• Picking and dropping of the loads as it travels

• Moving the load vertically into the vertical storage system

• Moving the load both vertically and horizontally for exactly positioning it for loading
and unloading operations.

CONVEYERS

These are gravity or powered devices. Commonly used for moving loads from point to
point over fixed paths. The various types of conveyors are:

a) Belt conveyor – Motor driven belt, usually made of rubberized fabric or metal fabric
on a rigid frame.

b) Chain conveyor – Motor driven chain that drags material along a metal slide base.

c) Roller conveyor – Boxes, large parts or unit loads roll on top of a series of rollers
mounted on a rigid frame. The rollers may be powered or unpowered.

d) Pneumatic conveyor – High volume of air flows through a tube, carrying materials
along with the air flow. The other types of conveyor are bucket conveyor, screw
 conveyor, pipe line conveyor, vibratory conveyors, tube conveyor, trolley conveyor and
chute or gravity conveyors. Advantages of conveyors are that they do not require
operators, will move a large volume of products and are inexpensive to operate.

CRANES, ELEVATORS AND HOISTS

These are over head devices used for moving varying loads intermittently between
points or within an area, fixed by supporting and binding rails:

a) Cranes are devices mounted on overhead rails or ground level wheels or rails.
They lift, swing and transport large and heavy materials. Examples are Gantry crane and
Electrically Operated Overhead Crane (E.O.T).

b) Elevators are types of cranes that lift material-usually between floors of buildings.

c) Hoists are devices which move materials vertically and horizontally in a limited
area. They are used primarily when materials must be lifted prior to being moved from one
point to another. Examples of hoists are air hoist, electric hoist and chain hoists.

Other devices under these categories are winches, monorail and the like.

MISCELLANEOUS HANDLING EOUIPMENTS-

I. Pipe lines which are closed tubes that transport liquids by means of pumps or gravity.

II. Automatic transfer devices which automatically grasp materials hold them firmly while
operations are being performed and move them to other locations.

III. Automated guided vehicle (AGV) systems- These devices do not require operators and
provide a great deal of flexibility in the paths they travel and the functions they perform. The
AGVS are controlled by signal sent through wires embedded in the floor or inductive tape on
the floor surface. A remote control computer is needed to control the movements of AGVS.

IV. Industrial robots- A robot is a mechanism which has movable arms like projection with a
gripper on the end that can perform a variety of tasks. Robots usually have a built in control
that can be reprogrammed and hence they are very versatile.

SAFETY IN MATERIAL HANDLING

a) Install adequate guards and safety devices on handling equipments.

b) Keep handling equipments in good operating condition.

c) Replace manual handling by mechanizes handling for difficult hazardous handling

activities.

d) Do not permit the handling equipments to be overloaded or operated beyond rated

capacity.

e) Keep aisles clear and uncluttered.

f) Avoid congestion of materials.

g) Maintain adequate lighting.

h) Maintain floors in good condition.

i) Provide good housekeeping.

j) Stack materials carefully.

k) Train operators in properly operating the handling equipment.

l) Highlight handling hazards or danger zones.

PACKAGING:

Packaging is the science, art and technology of enclosing or protecting products for
distribution, storage, sale, and use. Packaging also refers to the process of design, evaluation,
and production of packages. Packaging can be described as a coordinated system of preparing
goods for transport, warehousing, logistics, sale, and end use. Packaging contains, protects,
preserves, transports, informs, and sells. It is fully integrated into government, business,
institutional, industry, and personal use.

CONSUMER VERSUS LOGISTICAL PACKAGING

Packaging is a marketing tool and is related to the performance of marketing function. It is

primarily a delimitation of space and setting aside of a product from external environment.
Packaging forms the important cost element of the goods and represents 5-30% of the value
of the goods depending upon the product type. Packaging can be divided into two categories,
that is consumer and logistical packaging. The consumer or product packaging is basically
done for convenience, market appeal and protecting the product from the effects of natural
elements. However, logistical or industrial packaging is a very critical element in the physical
distribution process. Product packaging is designed to meet marketing objectives, but
logistical packing is designed while keeping in view the distribution objectives.

The primary purpose of logistical packaging is to prevent damage to the product during
storage, transportation and handling, when it is moved in bulk quantities for distribution in
the market. The packages move through varying storages, shipping and handling conditions
at different places on which shippers have no control. Hence, packaging should maximize the
protection of the product under different conditions so that it reaches the consumer in usable
from. Logistical packaging can considerably enhance the productivity of the logistical system
through ease in handling space utility, damage reduction etc. However, cost is an important
element, which gets influences by the type of packaging.
OBJECTIVES OF PACKAGING

1. The product should be protected from environmental abuses till the time it reaches to
the real customer. This involves protection from damage, pilferage, contamination,
physical effects and environmental conditions. During the logistical process, a non-
packaged product can be damaged in transportation, handling, and storage. Packaging
can provide protection against physical effects. For example eatable material is
packed in the poly-ethylene bags or foil to preserve against open air effects.

2. Ease of handling the product is provided in the packing. Odd shaped products are
difficult to handle properly. When packed it is easy to handle. Packaging helps in
improving efficiencies of material handling procedures, transportation, storage and
order picking.

3. Operating and functional instructions are displayed on the label stuck to packing.

4. Packaging enables product identification and tracking, and displays product care
information. It is facilitated by labels on the packages. Product identification
improves efficiency in receiving and order picking. Tracking of the product during the
logistical process improves logistical efficiency.

5. Making unitized packing, this involves having maximum weight, quantity in one pack
to improve the sales. For example in one pack more number of articles is packed
which the client will buy at a time.
 6. Packing also provides the attractive looks to the customer, which improves the selling
value of the product.

PACKING COST

In number of companies the packing cost is considered as indirect cost. It is apportioned

against general expenses and not attached to the product directly. However the expenses of
packing should be allocated to the product or product costing for proper recovery.

The packing cost comprise of

1. Material cost

2. Labour cost- the time spent by person involved in the working inspection.

3. Packaging equipment machine, tables, tools, and fixture.

4. Space and place for operation of packaging.

PACKAGING MATERIAL

For logistical packaging variety of materials are in use. However the most common are
follows.

Corrugated fibreboard
The master cartons are invariably made out of two to three ply corrugated sheets. However,
for logistical packaging, thicker corrugated sheets with 5-6 ply or more are preferred. This
material is most commonly used for consumer durables such as television sets, washing
machines, refrigerator, pharmaceutical products, liquor, cigarettes, matches, personal care
items, light engineering goods, paints and electronics goods.

Steel
The metal containers- boxes or drums- made out of galvanized mild steel sheets are used for
logistical packaging. This strong material can withstand abuse in handling during transit. The
usage of this material is recommended for products like chemicals or lubricants wherein
strong packaging material, which is less prone to damages during transit due to abuse in of
reduced .steel is commonly used for box containers used in multi-model transportation by
sea, rail or road.

Plastics
Plastic bags and containers are quite common in logistical packaging. Plastic drums are used
for transporting liquid chemicals, while bags are used for chemicals in solid form and food
grains packaging. The high density plastics are used for rigid lidded containers for storage
and transportation of small items.

Shrink plastic sheets are used for securing and protecting the unitized load on the pallets or
skids. Shrink packaging is very cost effective as compare to the rigid plastic containers.

Wood
Wood is the most common material used for construction of pallets or crates. The pallets are
deigned to take loads up to 2200 kg using hard wood. Soft wood may be used for weight
carrying capacity up to 2000 kg. The wooden pallets are cheaper as compare to metal or
plastic pallets.

Globally, wooden pallets are preferred and used for both in-house and shipping applications.
Investment in pallets is costly affair and hence is used on a limited scale. In the many cases
the user and the pallet supplier create pallet pool for refusing the pallets, and thus reduce the
recurring investment and resolve the problem of waste disposal.

PALLET MATERIAL COMPARISON

ADVANTAGES

Wood Plastic corrugated Metal

board
• Readily • Durable than • Easy to • Most durable
available wooden fabricate
pallets
• Easy to make • Cleaner than • Cheapest • Very strong
wooden alternative
pallets
• can be • Can be • Light weight • High
repaired in machine reparability
house moulded
• Take up loads • No • Easy to • Designed for
up to 2000kg. dimensional handle capacities up
variations to 4000kg
• Waste can be • Can be
recycled machine
fabricated

DISADVANTAGES
Wood plastic Corrugated Metal
board
• Dimensional • Not • Prone to easy costlier
variation due to disposable damage
manual
fabrication
• Prone to attack • Strength • Can’t take
by insects lower than more loads
wood
• Nailing may • Cannot be
cause wooden repaired
planking
splitting leading
to reduction of
pallet strength
• Wood fibre • Costlier than
structure can wooden
affect strength pallets