Introduction : Material Handling

Materials handling is loading, moving and unloading of materials. Some of the other definitions are:
1) Materials handling is the movement and storage of materials at the lowest possible cost through the use of proper
methods and equipment. 2) Materials handling is the moving of materials or product by any means, including storage,
and all movements except processing operations and inspection. 3) Materials handling is the art and science of
conveying, elevating, positioning, transporting, packaging and storing of materials.

OBJECTIVES OF MATERIAL HANDLING

Following are the objectives of material handling: A) Minimise cost of material handling. B) Minimise delays and
interruptions by making available the materials at the point of use at right quantity and at right time. C) Increase the
productive capacity of the production facilities by effective utilisation of capacity and enhancing productivity. D) Safety
in material handling through improvement in working condition. E) Maximum utilisation of material handling
equipment. F) Prevention of damages to materials. G) Lower investment in process inventory

PRINCIPLES OF MATERIAL HANDLING Following are the principles of material handling:

1. Planning principle: All handling activities should be planned. 2. Systems principle: Plan a system integrating as
many handling activities as possible and coordinating the full scope of operations (receiving, storage, production,
inspection, packing, warehousing, supply and transportation). 3. Space utilisation principle: Make optimum use of
cubic space. 4. Unit load principle: Increase quantity, size, weight of load handled. 5. Gravity principle: Utilise gravity
to move a material wherever practicable. 6. Material flow principle: Plan an operation sequence and equipment
arrangement to optimise material flow. 7. Simplification principle: Reduce combine or eliminate unnecessary
movement and/or equipment. 8. Safety principle: Provide for safe handling methods and equipment. 9. Mechanization
principle: Use mechanical or automated material handling equipment Standardization principle: Standardize method,
types, size of material handling equipment. 11. Flexibility principle: Use methods and equipment that can perform a
variety of task and applications 12. Equipment selection principle: Consider all aspect of material, move and method
to be utilised. 13. Dead weight principle: Reduce the ratio of dead weight to pay load in mobile equipment. 14. Motion
principle: Equipment designed to transport material should be kept in motion. 15. Idle time principle: Reduce idle
time/unproductive time of both MH equipment and manpower.

Concept of Material Handling

Material Handling involves the movement of material, manually or mechanically in batches or one item at a time
within the plant. The movement may be horizontal, vertical or combination of horizontal or vertical. Material Handling
is the movement, storage, control and protection of materials, goods and products throughout the process of
manufacturing, distribution, consumption and disposal. The focus is on the methods, mechanical equipment, systems
and related controls used to achieve these functions. Briefly, Material Handling is the moving of materials from the
raw stage through production to ultimate Customer with the least expenditure of time and effort so as to produce
maximum Productive Efficiency at the lowest Material Handling cost.

MATERIAL HANDING EQUIPMENTS

Types of Material Handling Equipment
Material handling equipment is grouped into four main categories: storage and handling, bulk material, industrial
trucks and engineered systems. Let’s take a look at each one.
1. Storage and Handling Equipment
Storage and handling equipment secures your goods while they aren’t being used or waiting for the next stage in the
supply chain process.
Storage and handling equipment can keep materials for short or long periods of time, depending on your warehouse’s
needs. Storage and handling equipment includes:
 Pallet racks: Vertical structures made of steel framing with connectors and beams to store products
 Shelves, bins and drawers: Shelves, drawers and bins within shelving units store smaller materials.
 Mezzanines: Wooden, steel or fiberglass raised platforms that create additional storage
 Stacking frames: Equipment that stores and stacks numerous pallets and racks
2. Bulk Handling Material Equipment
Bulk handling material equipment stores, controls and transports loose form materials in large quantities.
Loose form materials can include liquid, food and minerals, such as stones and rocks, and metal items, such as bolts
and nails. Bulk handling equipment includes:
Conveyor belts: Two or more belts and pulleys to transport products from one location to another
Stackers: Equipment that loads and unloads heavy materials and places them onto stockpiles or storage for bulk
materials
Reclaimers: Reclaimers are used to pick out materials from stockpiles
Bucket elevators: Designed for handling and lifting large amounts of bulk materials through the system
Hoppers: Funnel-shaped equipment used to dump or pour loose form materials into containers
3. Industrial Trucks
Industrial trucks are vehicles that transport goods and materials within your warehouse and are also utilized to load or
unload heavy objects.
There are several different types of industrial trucks. Some have forks or a flat surface to lift products, while others
need additional equipment for lifting. Industrial trucks can range from small, hand-operated machines to large,
drivable equipment. Industrial trucks include:
Forklifts: Industrial trucks that raise and lower goods in short distances
Hand trucks: Also called dollies, industrial trucks are manually pushed by hand and consist of two wheels and a
small ledge to carry goods
Pallet Trucks: Also known as pallet jacks, pallet trucks are designed to lift and move pallets
Sideloaders: Industrial trucks that go through narrow aisles, and load and unload goods from the machine’s sides
Order pickers: These machines safely lift operators, allowing them to access hard-to-reach materials on high
shelves
4. Engineered Systems
Engineered or automated systems are solutions that incorporate technology supported by computers and robots to
store and transport goods
An automated system is generally made out of several units, controlled by a management software application.
Engineered systems include:
Autonomous mobile robots (AMRs): Sophisticated robots that navigate their environment independently, without
the need for human intervention
Automated storage and retrieval systems (AS/RS): Computer-controlled solutions that keep and retrieve goods in
the warehouse
Automated guided vehicles (AGVs): Guided robots that require a human operator to navigate their environment

Classification of material handling equipment into two categories, namely:

(a) Fixed path equipments, and (b) Variable path equipments.
(a) Fixed path equipments which move in a fixed path. Conveyors, monorail devices, chutes and pulley drive
equipments belong to this category. A slight variation in this category is provided by the overhead crane, which
though restricted, can move materials in any manner within a restricted area by virtue of its design. Overhead cranes
have a very good range in terms of hauling tonnage and are used for handling bulky raw materials, stacking and at
times palletizing.
(b)Variable path equipments have no restrictions in the direction of movement although their size is a factor to be
given due consideration trucks, forklifts mobile cranes and industrial tractors belong to this category. Forklifts are
available in many ranges, they are manoeuvrable and various attachments are provided to increase their versatility.

Material Handing Equipment’s may be classified in five major categories .

1. CONVEYORS: Conveyors are useful for moving material between two fixed workstations, either continuously or
intermittently. They are mainly used for continuous or mass production operations—indeed, they are suitable for most
operations where the flow is more or less steady. Conveyors may be of various types, with rollers, wheels or belts to
help move the material along: these may be power-driven or may roll freely : -
A. Belt Conveyor: Flat, Trough, Closed rail, Metallic , Portable, Telescopic
B. Chain Conveyor: Apron/Pan, Slat, Crossbar or arm, Car type/Pallet,En-Mass, Trolly, Suspended tray or swing tray,
C. Haulage Conveyor: (A special class of chain conveyor in which load is pushed or pulled and the weight is carried
by stationary troughs, surfaces or rail.) 1. drag chain 2. flight 3 tow :(a) over-head (b) flush-floor (c) under-floor
D. Cable Conveyor
E. Bucket Conveyor 1. gravity discharge 2. pivoted bucket 3. bucket elevator (also included under III) 8.
F. Roller Conveyor 1. gravity
G. Screw Conveyor I. Hydraulic Conveyor H. Pneumatic Conveyor 1. pipe line 2. air-activated gravity 3. tube
2. INDUSTRIAL TRUCKS: Industrial trucks are more flexible in use than conveyors since they can move between
various points and are not permanently fixed in one place. They are, therefore, most suitable for intermittent
production and for handling various sizes and shapes of material. There are many types of truck petrol-driven,
electric, handpowered, and so on. Their greatest advantage lies in the wide range of attachments available; these
increase the trucks ability to handle various types and shapes of material.
Industrial vehicles/trucks are generally sub-classified into two groups :
A) Hand trucks /Non-powered truck :- Two wheel, Multiple wheel, Hand lift truck (Hydraulic Hand Pallet truck,
Platform lift truck)
B) The powered trucks: (a) Power Truck: Fixed platform truck, Platform lift truck Pallet lift truck, Walkie truck,
Straddle carrier, (b) Forklift Truck. (c) Tractor.
3. CRANES AND HOISTS: The major advantage of cranes and hoists is that they can move heavy materials through
overhead space. However, they can usually serve only a limited area. Here again, there are several types of crane
and hoist, and within each type there are various loading capacities. Cranes and hoists may be used both for
intermittent and for continuous production.
Types of cranes:-
A) Stationary Cranes : Jib crane, Overhead Travelling crane (also called Bridge crane), Gantry crane
Stationary Revolving Cranes : Wharf crane, Pillar crane, Tower crane
B) Mobile Cranes : Truck/wagon mounted crane, Crawler crane, Railway/Locomotive crane, Floating crane
4. CONTAINERS: These are either ‘dead’ containers (e.g. Cartons, barrels, skids, pallets) which hold the material to
be transported but do not move themselves, or ‘live’ containers (e.g. wagons, wheelbarrows or computer self-driven
containers). Handling equipments of this kind can both contain and move the material, and is usually operated
manually.
5. ROBOTS: Many types of robot exist. They vary in size, and in function and maneuverability. While many robots
are used for handling and transporting material, others are used to perform operations such as welding or spray
painting. An advantage of robots is that they can perform in a hostile environment such as unhealthy conditions or
carry on arduous tasks such as the repetitive movement of heavy materials.

Points to be considered while Material Handling/ Material Handling Tips for a

Safer Workplace.
1. Minimize Ergonomic Risk Factors :Ergonomic risk factors are those problems that cause unnecessary physical
fatigue in employees. These risk factors are commonly found in the manual material handling environment. Three
primary factors include stressful postures while handling materials like bending or twisting, highly repetitive motions
such as frequent reaching and lifting, and forceful exertions like carrying or lifting heavy loads. Identify all such
ergonomic risk factors and minimize them by putting control measures in place to limit the exposure of employees to
all possible risks.
2. Provide Personal Protective Equipment : Offering protective equipment to workers will greatly minimize injuries
when moving materials manually. Basic protective equipment includes eye protection, helmets, gloves, steel-toed
safety boots and metal fiber or plastic metatarsal guards to protect the in-step area from impact or compression.
3. Upgrade Your Equipment : You can minimize manual material handling by upgrading your equipment. Use
conveyor belts as well as forklift and conveyor belt scales to move materials rather than carrying them manually. This
not only will help to reduce the material handling risks but also increase productivity and profitability.
4. Reduce Noise and Vibration : Noise and vibration are widespread in many plants, making it imperative to protect
your employees’ hearing. Vibration causes noise, but it can also lead to work-related musculoskeletal disorders and
general employee fatigue. By introducing the right equipment, such as wheel materials, you can greatly decrease
noise and vibration. Matching the wheel materials to the floor surface will minimize vibration and noise as well. You
can also use shock-dampening casters and softer wheels to reduce noise and g-forces on a wheeled cart.
5. Respond to Reports of Employee Fatigue : Physical weariness and fatigue are common occurrences in manual
material handling tasks. Regardless of whether you have an excellent ergonomic process that caters to the workers’
capabilities, daily manual work can take a toll on your employees’ health. Cumulative fatigue eventually will give way
to a musculoskeletal disorder. Therefore, you must encourage employees to report any signs of discomfort and
fatigue so you can respond quickly and put control measures in place to prevent fatigue from developing into serious
injuries.
6. Use the Right Equipment : Manual material handling is risky, time-consuming and laborious. By choosing the right
equipment, you can make the process safer, faster and efficient. Conveyor belt systems offer numerous benefits for
handling weight loads of various sizes and styles. Material handling equipment is also available in the form of storage
equipment (shelves, racks and pallets) and bulk material equipment (trucks, silos, drums and grain elevators).
Designate and train the appropriate individuals on the correct procedures and verify that they always follow the rules.
Regardless of the size of the equipment and the simplicity of using it, ensure that only authorized and trained
individuals operate it.

Here are five safety tips you may find extremely useful when it comes to material
handling.
1) Ensure Proper Employee Training : Training plays a vital role in preventing material handling equipment -
related accidents. In fact, most modern material handling equipment requires trained operators. You can either
hire certified employees or provide the necessary training to your existing ones.
The training should include but not be limited to the following:
 Understanding the basics of pneumatic pressure based bulk material handling equipment.
 Knowing how different types of conveyor systems function.
 Finding out about the installation and commissioning of the required material handling equipment.
 Understanding manual material handling hazards and how to avoid them.
 Learning operations and maintenance of material handling systems, including automation and control skills.
 Developing warehouse and storage skills such as sorting, packing, order picking, storing, unloading, and loading.
2) Provide Workers with the Latest Safety Gear : Personal Protective Equipment (PPE) can reduce the risk of
workplace injury significantly. These specialized clothing and accessories protect workers from physical, chemical,
and biological harms in some cases.
A). Head – Head protection equipment includes helmets, hard hats, and other gears. Make sure there are no dents
in the shell, and all the straps are devoid of any deformities.
B). Face – Face protection gear includes gas masks, respirators, full-face respirators, face shields, safety glasses,
and goggles depending on the work conditions.
C). Hearing – You will need to provide workers with earmuffs and plugs if they are going to work in a noisy
environment. The equipment must fit the ear canal perfectly.
D) . Body – You can use safety vests and full body suits to protect workers from hazardous spills, skin burns,
radiation, and high or low temperatures.
E). Hands and Legs – Safety gloves, knee and knuckle pads, and safety boots will protect your hands and legs from
3) Conduct Pre-Shift Inspections
Pre-shift inspections can help you identify potential safety issues in time. Before each shift begins and after it
ends, ask your experienced and trained safety managers to perform a visual inspection of the equipment as well
as safety gear.
You will most probably find cracked hoses, rusty metal components, and faulty or worn-out wiring and electronics
during routine inspections. Ignoring these small issues can lead to a fatal accident resulting in considerable
downtime. So, make sure to check the following:
 Readability of manuals or instructions on the equipment.
 Hydraulic and electrolyte fluid and oil levels.
 Leaks, cracks, punctures, cuts, and other visible deformities.
 Dust, moisture, and dirt build-up.
 Straps, seats, railings, and other safety devices.
 Frayed wires, cables, and connectors.
 Loose hoses, straps, valves, restrain brackets, and coils.
 Safety alarms, smoke and fire detectors, and lighting.
4) Take Extra Care for Manual Handling: In construction and heavy lifting industry, you often need to move
oversized loads. Although you can use cranes, forklifts, and trucks, you will rely on manual help to a great extent.
As a result, you will need to take extra care when handling heavy loads.
Keep the following in mind:
 Allow only workers with required rigging safety training to handle such loads.
 Know the accurate weight of the cargo before proceeding.
 Use the right wire rope cables, rigging hooks, and overhead crane to move the load. It should be capable of
carrying the cargo safely.
 Make sure the load is secure and stable, and the operator has clear visibility.
 You should raise or lower the load only when it is not in motion.
 Move the load at a safe speed to avoid swaying. Keep the pathway clear.
 Use blocking materials that are strong enough to support the cargo safely.
 While handling smaller loads, use proper lifting techniques. Always encourage leg lifting, and ask workers to use
lumber support belt whenever necessary.
 You should also attach handles or holders to the cargo if required.
5) Check on Employee Fatigue: Despite an ergonomically-designed material handling process, your employees
are likely to feel fatigued or tired. Even the simplest manual material handling tasks can take a toll on a worker’s
health. You should have a standardized reporting system to identify and inform the floor manager of employee
fatigue during every shift.

Role of material handling in logistics

Material handling is one of the key aspects of supply chain management. It has control over the protection,
management, and storage of the product and material process throughout manufacturing, warehouse, and
distribution. Material handling is not only related to goods but also to logistics too.
Logistics includes safe transport, warehousing, structural engineering and installation, storage, infrastructure, and
conveyance solutions.
Materials handling insists on a few elements that are movement, time, quantity, and space. How efficiently it receives
and delivers the product? For how long the product is going to stay in storage? Is the space available and
environment suitable for the product? All these elements help in improving the efficiency of supply.
∙ Movement – Receiving the product loading it in the truck moving from inventory to warehouse or using
a conveyor system to move around the distribution center and putting it safely for shipping

∙ Time – To figure out how much time frame is required for the product from inventory till the shipment. How long a
product is going to stay within the storage.
∙ Quantity – total quantity of the product and how much space will it require within the storage from the time it
comes in and when the time it goes out.
∙ Space – space only includes the amount of space given or being kept available to the product and also includes
the way it is stored which tells about the safety of the product and its condition too.

Role of materials handling

The main role of material handling is to improve efficiency by making the logistic system respond effectively and
quickly as per the customer’s demand. It basically means that it helps improve customer service by making products
to be found, moved, and delivered easily. Material handling is not only for the company but also for the customer’s
needs. It cuts costs by reducing the time and money and effort and also reduces the product damage while doing
product transport. It’s very important in outbound logistics.

Disposal of Surplus, Scrap and Obsolete Materials | Materials Management

# 1. Feedback: Circulation within the company to its various units at various locations and to different departments to
get necessary feedback of the requirement of surplus or obsolete stock of one unit to another unit.
# 2. Return to the Supplier: If there is no requirement from within the company units/departments, then materials
should be returned to its original supplier at original cost after deducting a small amount as a restocking charge.
Good suppliers do take back such unused materials in order to develop better business relationship. Nowadays, the
industrial buyers insist on incorporating buy-back clause during finalisation of purchase contract.
# 3. Direct Sale to Another Company: Surplus and obsolete materials of one company may serve-a useful purpose
in another company having the same product line and an identical production system. In such cases, attempts should
be made to sell surplus and obsolete materials to those firms. Sometimes scrap of some company becomes the raw
materials of another.
# 4. Sale to Dealer or Broker: Sale to a dealer or broker may be done by auction, with notification on ‘as is where is’
basis. It may be open auction or tender. Yearly rate contract system can also be followed where the dealers are to
collect the scrap from the particular area of production shop. The contract procedure and legal formalities adopted in
buying are applicable in sales of surplus, obsolete materials, scrap and waste.
# 5. Sale to Employees: Some organisations follow the practice of selling the surplus, obsolete and non-moving
items to their employees at a very low price. This sometimes satisfies the employees who make some gain by re-
selling the materials or by using the same in their houses.
# 6. Donation to Educational/Research Institutions: Various schools, colleges, polytechnics, engineering and
technology institutes, universities, research centers, medical colleges and scientific laboratories require various tools
and equipment for research. This is why many organisations follow the practice of disposing off unwanted materials
to the academic institutions as a good gesture and also to enjoy some tax benefit.

Waste Management – Surplus and Obsolete

Industrial wastes and scraps include spoiled raw materials, defective parts, rejected components, production wastes,
etc. that holds a commercial value, and therefore, they should be discarded at periodic intervals and the amount
should be accurately recorded into the books of accounts. Therefore, waste management plays a key role in
proper management of operations. Waste materials can be classified into three categories:
Obsolete – These materials / equipment hold an economic value and are not damaged, but are not useful to the
company for a longer duration for its operations on account of reasons, such as changes in process, product line,
materials, etc.
Surplus – These materials / equipment do not have immediate use, but have been amassed due to faulty planning
and purchasing. But they do have a usage value in the future.
Scrap – This refers to the process wastage, such as borings, turnings, flashes and borings, which have an end use
and hold commercial values. So, they need to be discarded periodically.

Material storage system: Introduction & Concept.

Materials storage is a fundamental process that enables companies to stock the goods they need to supply their
production lines. The function of material storage system is to store materials for a period of time and to permit
access to those materials when required.
Why is materials storage important?
The supply chain of any product manufacturer encompasses a multitude of processes: from raw material storage to
production line supply. Like a domino effect, maximising efficiency in each operation will positively impact the other
activities performed in the logistics facility.
Warehousing is a core process for any manufacturer. Streamlined materials storage is essential for production
planning and, in turn, meeting planned deadlines. These are some of its advantages:
 Availability of resources required for manufacturing.
  Storage space optimisation.
 Reduction in logistics costs.
 Rapid, effective responsiveness to demand.

Materials storage systems can be classified into 2 main categories:

 Manual systems. Operators handle goods manually with the help of forklifts.
 Automated systems. Handling equipment physically manages unit loads and places them in the ideal
locations.

Unit load:-
The term unit load refers to the size of an assemblage into which a number of individual items are combined for ease
of storage and handling,[1] for example a pallet load represents a unit load which can be moved easily with a pallet
jack or forklift truck, or a container load represents a unit for shipping purposes. A unit load can be packed tightly into
a warehouse rack, intermodal container, truck or boxcars, yet can be easily broken apart at a distribution point,
usually a distribution center, wholesaler, or retail store for sale to consumers or for use.
A unit load is the basic storage and transport unit arranged on a modular support or in packaging (box, pallet,
container, etc.) to ensure efficient handling. Unit loads are handled at working locations such as a general
warehouse, reserve warehouse, picking warehouse with live storage racks, in-house transport equipment, etc. As a
result, in a single installation it is possible to handle one type of unit load or various types.
The unit load can be divided into smaller elements that can also be handled.
Unit Load: Function
Most consumer and industrial products move through the supply chain in unitized or unit load form for at least part of
their distribution cycle. Unit loads make handling, storage, and distribution more efficient. They help reduce handling
costs and damage by reducing individual handling.
A typical unit load might consist of corrugated fiberboard boxes stacked on a pallet or slip sheet and stabilized
with stretch wrap, pressure-sensitive tape, strapping or shrink wrap. About 2 billion unit loads are in daily use in the
United States.
Unit load storage and distribution systems consist of several interacting parts:
A)Packaging and labeling (with product) B) Pallet C) Handling/storage equipment D) The distribution environment

Principles of Storage
The principles of product storage include:
1. Proper organization and labeling to ensure easy identification and inventory management.
2. Proper temperature and humidity control to preserve the quality and safety of the products.
3. Protection from physical damage and contamination.
4. Use of appropriate packaging to maintain product freshness and integrity.
5. Use of first in first out (FIFO) or first expired first out (FEFO) rotation system to ensure product is used
before it expires.
6. Regular monitoring and inspections of storage area for any potential problems.
7. Compliance with industry and government regulations related to product storage.

Storage Design – Benefits

Proper planning of the storage system helps in improving the efficiency of the entire logistics system. This helps in
speedy movement of goods across the supply chain, which results in improving system productivity.
1. Space Economics : Proper design of storage scheme can result in a substantial saving on the available space,
which helps in planning for additional storage load without any investment in space.
2. Enhance Throughput : A well-designed storage scheme will reduce the movement of material handling
equipment and the idle time, resulting in significant improvement in system productivity.
3. Ease in Material Location and Tracking : Proper storage scheme helps in quick location and tracking of the
inventory item during material pickup operation, resulting in compressed order cycle time.
4. Security, Safety and Housekeeping : A well-designed system will bar unauthorized access to the inventory
ensuring security against theft and pilferage. The system will also reduce the accidents due to fatigue, strain and
collapse of the equipment. As the number of product handlings is reduced, the risk of damage to the products is
greatly minimized.

Storage Design :Storage systems need to be properly designed, operated, and

maintained to reliably perform intended function.
Bulk solids are commonly stored in tanks or silos that can be configured in multiple shapes and sizes for the
particular storage needs. The storage system that is installed needs to be properly designed, operated, and
maintained to reliably perform its intended function.
The material to be stored is the most important consideration for designing the storage system.
Every material has inherent characteristics that impact proper design. Some of these characteristics are:
1) Bulk density to use for volume and structural loading 2) Angle of repose 3) Moisture content and hygroscopic
properties 4) Abrasiveness 5) Corrosiveness 6) Cohesiveness 7) Friability 8) Particle size 9) Explosibility
An understanding of the operating requirements is also needed for proper design. Considerations include:
1)Storage capacity 2) Long-term storage or frequent cycling 3) Concern with material degradation or segregation 4)
Fill and discharge flow rates required 5) Is aeration required?

Types of Storage Methods

1. Pallet Racking : Pallet racks are the most fundamental component at warehouses used for high stacking of
palletized goods.
The structure of a pallet rack comprises vertical columns and horizontal beams. The upright column of a pallet rack
serves the purpose of exploiting the vertical space at a warehouse and varies in height, depth, and design based on
storage needs and infrastructure.
Various benefits of pallet racking at your warehouse are: Pallet racking optimizes inventory storage at your
warehouse by allowing you to exploit the vertical space hence increasing storage efficiency and storage density.
New generation pallet racking systems are equipped with slant-back support frames, especially in driving-in storage
systems. This very trait ensures the safety of goods from damage and loss. Racking systems are generally
expandable and as a business, when your inventory grows — you can accordingly adjust the pallet racking system.
2. Single Stacking Single stacking is most commonly practised method at a warehouse for the storage mechanism
due to its meager setup costs and flexibility. In this method, pallets are stored and handled directly on the floor space
instead of dedicated storage equipment.
Single stacking typically serves the purpose of storing goods that are high in value and require special attention
throughout the storage period, to prevent any damage or contingency, resulting in significant losses.
Single stacking is one of the oldest forms of storing high-value goods and only involves a ‘single’ row of
pallets or cartons covering a flat surface.
3. Double Stacking or Block Stacking : Double stacking or block stacking ventures the utilization of the vertical
space available after the first layer of stacking. Double stacking or block stacking is an effective method if it goes in
sync with the goods that need to be stacked. Block stacking doesn’t require dedicated storage equipment but is
instead a system of multi-layered stacking of one block over another. Although, block-stacking cannot be applied
everywhere and at every condition,
4. Pallet-less Stacking : Pallet-less stacking is a process that aims at the complete removal of pallets for the storage
of goods. The method involves utilizing the floor space and stacking cartons or crates one over the other. Stacking
one box over the other enables the usage of vertical space.
Pallet-less stacking also allows one to store goods based on the order.
A) FIFO: the method of pallet-less stacking allows the first-in-first-out form of inventory management, which implies
that the goods that enter your warehouse in the first place are goods that also exit the warehouse primarily as per
requirement. Appropriate execution of FIFO ensures proper rotation of your stock. For example, FMCG products.
B) LIFO: The last-in-first-out technique to stock management is contrary to the previous method. LIFO refers to the
process where the products that have recently entered the warehouse are the ones that are cleared first. This
method is suitable for products that are homogenous or imperishable. This method serves considerably well for
goods that are seasonal or perishable. For example, commodities.

Store Location And Layout

Store Location : The location of stores is a strategic decision which if once taken cannot be easily undone. It
would be extremely costly to change the storage location at a later stage. It should be carefully decided and planned
so as to ensure maximum efficiency. The optimal location of stores minimizes the total transportation, handling and
other costs related to stores operation and at the same time provide the needed protection for stores items. The
models of facilities planning can be applied to determine the optimal storage location in large size organizations.
Store location depends upon the nature and value of the items to be stored and the frequency with which the items
are received and issued to the different departments. Other important factors governing the location are the number
and location of end users, variety and volume of goods to be handled, location of the central receiving station and
accessibility to rail or road links.
In general, stores are located close to the point of use. Raw materials stores are usually located near the first
operation (in case of line layout), in process stores near to subsequent operation, and finished goods stores near the
shipping area. The tools and supplies stores are located centrally to the personnel and equipment served.
In big plants it may not be possible to locate the stores which are convenient to all the departments and at the same
time near to the receiving section. Usually a central store is located near the receiving section and the issues are
decentralized by setting-up sub stores conveniently located to serve user departments.
The location and building up of stores should be done with a futuristic outlook. The provision for the new departments
and the increase in the volume to be stored should be kept.

Layout and Design of Stores:

The efficient layout and design of stores is very important from the point of view of its functioning which is linked to
the overall functioning of the plant. A good layout must bring the point of origin, store room and point of use in
adjacent and proper reference of best material flow. The planning and design of stores should be carried out
with the following objectives in mind:
 To achieve maximum ease of operation with ready accessibility of major materials
 To achieve minimum waste of space and flexibility of arrangement
 Minimization of material handling requirements
 Minimization of material deterioration and pilferage
 To assist the planning to meet the objectives, following information should be generated from the records:
 Classification of store items by size, number, weight, frequency of handling (FSN-Fast moving, Slow moving,
Non-moving), handling arrangements, perish ability
 Space requirement to store the item
 Units withdrawn at a time
 Maximum number of units to be stored at one time
 Storage facility best suiting the item
 List of available storage space for different kinds of storage facilities
 Size and shape of the space available for laying out the stores
 Prepare a flow diagram of the flow of materials through the stores.
 REL Chart for the storage of different classes of materials can be prepared.
 While planning the layout and design of the stores, following factors should be considered:
 The space for receipt and inspection should be provided adjacent to the main stores.
 Use of third dimension must be made effectively.
 Different storage facilities should be situated in clearly defined lanes, so that items are quickly stored and
located.
 Main lanes or aisles should usually be 1.5 to 3 meters wide, depending upon the type of material and the amount
of traffic involved.
 Clear markings should be made at storage space to facilitate location and identification.
 The fast moving items should be stored near the dispensing window; the slow moving should be away from the
window.
 The layout should permit the use of modern material handling equipment.
 Stores layout should encourage the FIFO, i.e. the old stock should be used earlier and the storekeeper should
not be compelled to keep the new stock above the old one.
 Due space should be left for expansion purposes in each portion.
 A pleasing and hygienic environment must be provided within the store room. This may be done by proper
selection of the colour of walls, provisions of exhaust removal, provision of cleaning etc.
 Adequate and clear lighting arrangements should be provided.
 Adequate safety provisions including firefighting equipment, alarms, accident control and prevention methods
should be inbuilt in the store room design.
 Special facilities, such as cold room, heating equipment, air-conditioning etc., if required, should be carefully
planned in advance.
Choosing a storage system: The best storage system for your warehouse is the one that meets your
criteria. When deciding on a system you need to take a number of factors into account, including:
 Capacity – how much do you need your warehouse to be able to hold?
 Types of products stored – are they heavy, light, boxed or palletised?
 Access – do you need speedy, frequent access to the goods, or is storage for the longer term, with slower
turnaround?
 Variety – will you have a high number of SKUs? How many units of each will you need to store? How many
pallets or boxes per SKU?

Choosing the Right Warehouse Storage System, There are several important
factors to consider:
1). Warehouse Layout and Space Constraints: Evaluate the dimensions of your warehouse, including the available
warehouse storage facilities, floor space, and ceiling height, to select a racking system that optimizes vertical space
and efficiently utilizes the available storage area. 2). Storage Requirements and Inventory
Characteristics: Assess the nature of your inventory, including its size, weight, and storage requirements, to
determine the most suitable system that can accommodate your specific storage needs. 3). Pallet Type and
Size: Analyze the types and sizes of pallets used for storing your inventory to choose a storage system that can
effectively accommodate and secure the specific pallet types utilized in your operations. 4).Number of SKUs Stored
in Each Rack: Consider the diversity and quantity of stock-keeping units (SKUs) to be stored within each rack to
determine the most efficient and organized arrangement for easy accessibility and inventory management.
5). Product Shelf Life: Factor in the shelf life and perishability of your products to choose a system that supports
proper storage conditions and facilitates efficient stock rotation based on the first-in, first-out (FIFO) or last-in, first-out
(LIFO) principles as needed. 6). Fork Truck Type and Lift Height: Take into account the type and capabilities of the
fork trucks utilized in your warehouse, along with their lifting height capacities, to ensure compatibility with the chosen
storage system and to facilitate seamless material handling operations within the warehouse. 7). Accessibility and
Retrieval Frequency: Analyze the frequency of inventory retrieval and consider the ease of accessibility required for
different products to ensure a smooth and efficient workflow within the warehouse. 8). Scalability and
Flexibility: Anticipate future growth and changes in inventory volume, and opt for warehouse storage solutions that
offer scalability and adaptability to accommodate potential expansions or modifications in your storage requirements.
9). Cost-Effectiveness and Return on Investment (ROI): Factor in the initial investment cost, maintenance
expenses, and the long-term benefits of each storage system to determine the most cost-effective option that
provides a favorable return on investment over its lifespan.

Store Housekeeping:
Housekeeping is not just cleanliness. It includes keeping work areas neat and orderly, maintaining halls and floors
free of slip and trip hazards, and removing of waste materials (e.g., paper, cardboard) and other fire hazards from
work areas. It also requires paying attention to important details such as the layout of the whole workplace, aisle
marking, the adequacy of storage facilities, and maintenance. Good housekeeping is also a basic part of incident and
fire prevention.
Effective housekeeping is an ongoing operation: it is not a one-time or hit-and-miss cleanup done occasionally.
Periodic "panic" cleanups are costly and ineffective in reducing incidents.
Housekeeping order is "maintained" not "achieved." Cleaning and organizing must be done regularly, not just at the
end of the shift. Integrating housekeeping into jobs can help ensure this task is done. A good housekeeping program
identifies and assigns responsibilities for the following:
 clean up during the shift
 day-to-day cleanup
 waste disposal
 removal of unused materials
 inspection to ensure cleanup is complete

What is the purpose of workplace housekeeping?

Poor housekeeping can be a cause of incidents, such as:
 tripping over loose objects on floors, stairs and platforms
 being hit by falling objects
 slipping on greasy, wet or dirty surfaces
 striking against projecting, poorly stacked items or misplaced material
 cutting, puncturing, or tearing the skin of hands or other parts of the body on projecting nails, wire or steel
strapping

What are some benefits of good housekeeping practices?

Effective housekeeping results in:
1). reduced handling to ease the flow of materials 2). fewer tripping and slipping incidents in clutter-free and spill-free
work areas 3). decreased fire hazards 4) lower worker exposures to hazardous products (e.g. dusts, vapours)
5). better control of tools and materials, including inventory and supplies 6). more efficient equipment cleanup and
maintenance 7). better hygienic conditions leading to improved health 8). more effective use of space 9). reduced
property damage by improving preventive maintenance 10) less janitorial work 11) improved morale 12). improved
productivity (tools and materials will be easy to find)

Stores Accounting
Stores accounting is the process of recording details of stock movements and balance in value. It is sometimes
undertaken by the finance department, but there is much to be said for it being handled by the store functionaries. For
smooth execution of works or manufacturing of products 'receiving, storing and issue of material' are important as the
quality of finished product depends on the materials used. Also smooth and efficient work or production depends on
timely supply of materials. A properly stocked containing store materials including tools and plants is absolutely
necessary for successful operation of a manufacturing organisation. For effective maintenance of stores proper
accounts are to be maintained. The stores account should give sufficient information regarding the different types of
materials stocked, quantity and value of each material, their receiving time and quantity as well as cost of
maintenance of stores. Store account thus indicates the value of stock held, providing a basis for issue rates and
convenient means of stock control by value. By analysing the inventory record and stock items, where the usage
during a number of past recorder period has been noted, one can decide the safety stock limits. Poor management of
stores may create serious problems even leading to business failures. A stock out creates a serious problem for the
organisation. Efficient stores management is thus essential for efficient functioning of any organisation.
Objectives : The objectives of maintaining stores account is
(a) to keep record of different materials received in store. (b) to keep record of all issues of materids. (c) to indicate
the values of stocks held. (d) to provide a basis for determining Issue Rates. (e) to debit the cost of acquisition of all
materials to the final head of accounts concerned or the particular work for which they are required. (f) to help provide
adequate storage of materials to meet the demands of the consuming departments. (g) to help minimize
obsolescence, spplus and scrap through proper codification, preservation and handling. (h) to highlight stock
accumulation, discrepancies and abnormal consumption and effect control measures.(i) to help good housekeeping
so that material handling, preservation, stocking, receipt and issue can be done efficiently. (j) I to assist in verification
and provide supporting information for effective
purchase action.
Account Records:
The main account records of stores are :
(1) Bin Cards /Register of Bin Cards. (2)Goods received sheets I Register of GRS. (3) Indent / Summary of Indent.
(4) Summary of Stock Receipts / Issues. (5) Priced Stores Ledger. (6) Transfer Entries. (7) Suspense Account.

STOCK TAKING
Stock-taking represents complete process of verifying the quantity balances of the entire
range of items held in stock. Measures to periodically count the stock is essential to check
against discrepancies, deficiencies, shortages, surpluses, manipulations, mal-practice, etc.
Normal periodical stock-taking is a basic requirement of stores accounting. In addition
stock-taking by independent offices at irregular intervals and the counting of stores is
items carried out so as to provide a built in safeguard against any tendency to pilfer, steal
and take the advantage of fictitious issue, overloading, obsolescence etc. of stores.
Objectives of stock-taking are :
I ji) Verification of accuracy of stock records. I
(ii) K-conciliation of value accounts with the actuals (ground realities)
(iii) Unearthing the possibility of fraud, loss, theft, pilferage or fictitious issues.
There are two methods of stock-taking - periodic and continuous.

Warehousing:
Warehousing is the process of storing goods until they're ready for transport to retailers, distributors or customers.
Businesses can benefit from warehousing in several ways, including more efficiently managing inventory and
optimizing the shipment process.
Warehousing is the process of buying goods from a manufacturer and then storing them in a warehouse before
fulfilling the orders. The process of warehousing involves the organization and management of any products before
distribution. Businesses may store goods in a warehouse, storage facility or, in the case of small businesses, in a
home garage or basement.
Concept:-

Functions of warehousing
Here are a few of the primary functions of warehousing:
1. Streamlining the shipping process : Larger companies often place warehouses in strategic locations to help with
shipments. They may choose to build warehouses in close proximity to a large percentage of their customers or along
a direct shipping route. This helps them pick and ship goods faster and more efficiently.
Related: What Is Consolidated Shipping in Freight Activities?
2. Supporting the supply chain : Manufacturers use warehouses to store raw materials and finished goods. This
allows them to keep the production facility clear of excess amounts of material and product that may use valuable
space in the factory. Keeping the warehousing and production functions separate optimizes the warehouse for the
receipt and distribution of goods and materials, creating a more efficient process than an operation focusing on both.
Using warehousing for finished goods can also give manufacturers the ability to run larger production batches since it
provides a location to store the product.
3. Managing inventory : Warehousing includes inventory management, which is the tracking and organization of
products and goods shipments. Having a good logistics plan in place is critical for shipping goods in a timely manner
and at a cost-effective price. Another function of warehousing is also capacity planning. In addition to storing existing
goods, it's also necessary to know that you have the space available for new products.
Related: 19 Inventory Management Techniques for Better Outcomes
4. Enabling climate control : Warehouses not only provide businesses with secure storage, but they can also
provide storage with climate control. This may be essential to some businesses that have products in which
preservation depends on the climate. It can also help businesses extend the life of perishable products, giving them a
larger window in which to sell them.
5. Maintaining quality control : Quality control related to receiving raw materials and shipping finished goods is a
function of warehousing. Inspecting raw materials at an inbound warehouse can prevent nonconforming materials
from entering the production process at a manufacturer. Inspecting outbound finished goods at a warehouse provides
a final check for quality defects before products ship to distributors, retailers or customers.

Types of warehousing
There are a few different types of warehouses, including:
A). Private warehouses: A private warehouse is when a business exclusively owns or rents a warehouse space.
Some businesses may choose to rent out any additional space they have to others.: a)Increased control over building
facilities b)Great for companies that need a significant long-term presence in a specific region c)Provide a more
exclusive location for business operations
B). Public warehouses: A public warehouse is a place that businesses rent to store goods. State or government
departments or large corporations may own the warehouse and rent out the space to other entities:
1)Accessible to the public 2). An affordable option for new businesses 3)Great for seasonal businesses 4)Ideal for
short-term storage
C). Co-op warehouses: A co-op warehouse is a space that a cooperative owns and rents. They may rent out
different warehouse facilities to businesses that share the space:
 Great for groups of businesses with similar inventory types.
 Fairly accessible due to combined investments
 Can save businesses money on reduced rates for multiple tenancies
D). Distribution centers: A distribution center is a place that receives shipments and then moves them to a new
location. Larger companies often have numerous distribution centers in different locations.
 Generally affordable to utilize for companies selling to wholesalers
 Designed to increase overall efficiency for inventory management
 Less money is wasted on long-term storage of product
E). Cold Storage Warehouse :A cold storage warehouse is a warehouse used for the storage of temperature-
sensitive products. Cold storage warehousing might include an entire building or even a specific portion of a
warehouse that can accommodate these goods. Cold storage warehouses have regulated environmental conditions
to ensure inventory is safe and no losses are suffered before goods are delivered. While cold storage warehouses
seem like any other warehouse from the outside, they have vastly different inner workings to provide a safe space for
these goods.
  Ideal for companies or businesses that sell perishable inventory
 Attractive for businesses that require certain conditions for rare products, such as artwork or plants
 Commonly used by pharmaceutical companies
F). Smart Warehouse
An increasingly popular warehouse option is a smart warehouse, which is a warehouse where the storage and
fulfillment processes are automated with AI, such as robots and drones. The AI is responsible for packing, weighing,
transporting, and storing raw materials, with many incoming orders being automated to be fulfilled immediately. Smart
warehouses have been a go-to option for large e-commerce companies such as Amazon that seek to make their
order fulfillment and inventory management a more accurate and expedited process.
 Inventory management is more accurate
 Automated functions decrease human error and save on labor
 Increase safety and security within the facility
 Provide insight into overall business efficiency
G). Bonded Warehouse
A bonded warehouse is a type of warehouse that stores imported goods before customs duties are completed and
paid for the products. Customs clearance can be an extensive process, and bonded warehouses provide a safe
space for these goods in the meantime. Government bodies provide businesses a bond to rent the space to ensure
the business doesn’t suffer from any loss of profits once products are ordered. These features of bonded warehouses
can be attractive for importers that might need short-term or long-term storage for items that would usually be
restricted.
 Companies do not need to pay duties until items are released from storage for delivery
 Facilities tend to be versatile to accommodate a large variety of products
 Ideal for companies or businesses that deal with cross-border training

Why is warehousing important/ NEED

Warehousing is an essential part of the supply chain for most types of businesses that deal in physical goods. This
could be consumer businesses holding a product that eventually makes its way to an end retail customer, or it could
be business to business (B2B) companies storing products that eventually make it to business customers.
For retail and ecommerce businesses, warehousing allows:
 The purchase of wholesale goods in bulk that may not fit in a physical retail store or yet be purchased by an
end consumer online.
 Large bulk orders - which allow these businesses to negotiate lower prices with their suppliers, thus
improving their margins when selling to customers.
 Keeping inventory available as demand fluctuates to ensure products stay in stock.

Evolution of Warehousing:-
Digitization of Warehousing Systems
In the mid-1900s, the Second Industrial Revolution (also known as the Technological Revolution) drove rapid growth in
scientific discoveries, mass production, and industrialization. This growth resulted in the initial digitization of the warehousing
system, and the first WMS, called the AS/RS or Automated Storage and Retrieval System, was born. In the 1960s, Demag
(now known as Dematic) developed the first Automated Storage and Retrieval System that laid the foundation for the
Warehouse Management System that we know today. This Automated Storage and Retrieval System was first used in a
book-club warehouse in Germany, which helped streamline the warehousing process.
Implementation of the Automated Storage and Retrieval System brought many advantages. It reduced labor costs and
helped achieve seamless processing and logistics. But that’s not all. One of the main advantages was the tall vertical storage
aisles that enabled faster access to inventory and maximized storage space. This innovation made us rethink traditional
warehousing.
Introducing Warehouse Management System
In the 1970s, with the development of computers and mainframes, came the first generation of Warehouse Management
Systems, or WMS as it is commonly known. In 1971, Walmart opened its first Distribution Center, which made experts in the
industry rethink what was possible for Supply Chain. By 1974, most conglomerates had begun the implementation of UPC
Barcodes for their products, making important inventory-related information so much easier to store. In 1975, J.C. Penney
developed the first real-time Warehouse Management System, which in simple words, changed the world of the Supply
Chain.
The idea behind the first generation Warehouse Management Systems was simple - identifying what your inventory is, where
it is stored, and how much can be sold. The adoption of barcodes gained prominence, making inventory easier to identify and
track. The data regarding inventory and other warehouse parameters were stored much more effectively as everything was
digitized.
By the early 1990s, many vendors such as JDA, Manugistics, and Red Prairie, among others, had developed their
proprietary Warehouse Management Systems. Commerce at this time was picking up pace and growing rapidly. With the
increase in Global Trade, the Supply Chain industry now demanded more. Many conglomerates and organizations had set
up warehouses and distribution centers that required different tools for efficient functioning. This led to many innovations and
development in the Warehouse Management space.
How the Warehouse Management System Evolved
By the mid-1990s, warehouses got more and more intricate. Visibility and control posed a challenge, which paved the way for
the development of Warehouse Control Systems, which mainly focused on optimizing and controlling the warehouse's
functioning. From automating pieces of equipment, conveyors, and carousels, the Warehouse Control System effectively
managed many moving parts of the Warehouse.
At this point, many companies had realized the potential of Warehouse Management Systems (WMS), and they
understood to move forward, the Warehouse Management System had to be more robust and powerful. Just providing base
functionalities was not enough, which led to the development of the second generation of Warehouse Management
Systems.
The second-generation platform came with many features. One of them was the Cross-Docking feature. This was the ability
to seamlessly move the inventory from the point of reception to shipping, which expedited the shipping process. The
integration of RFID and RF guns was a notable feature as this changed the way warehouse associates handled and
processed inventory.

Warehousing cost
The warehousing costs affect the product cost. When a warehouse is not utilized fully, product cost will be increased
rapidly. The fixed costs of the products are always influenced by the rate of utilization of the warehouse. The
warehousing costs include rent, utilities, salaries, financial costs such as opportunity cost, and inventory costs related
to perish ability, pilferage, shrinkage and insurance. Warehousing costs vary from warehouse to warehouse
TYPES OF WAREHOUSING COSTS It is clearly known that the economic efficiency of any company is determined
by the ability of the company to minimize its costs and maximize its profits.
 Direct Cost This cost directly relates with a unit of operations like organizing process or an activity, manufacturing
a product etc. Direct cost is defined as the financial costs that are incurred as the result of purchasing factor services
from the market. It is also called as “Traceable Costs”. The nature of the direct costs is related with a particular
product/process, they vary with variations in them. Examples of direct costs are direct labor, direct materials,
commissions, piece rate wages, and manufacturing supplies.
 Indirect Costs Indirect costs are those which cannot be easily and definitely identifiable in relation to a plant, a
product, a process or a department. The indirect costs may or may not be variable in nature. Examples of indirect
costs are production supervision salaries, quality control costs, insurance, and depreciation. Indirect costs are also
called as Non-traceable costs.
 Fixed Cost Fixed Cost is the cost which does not change based on the company either is operating or not. For
example, rent or mortgage payments, insurance premiums, car payments, other loan payments, property taxes.
Variable Cost As its name suggests, the variable cost varies with the business operations. When the company is
not operating, the variable cost of the company will become Zero. Variable Cost is directly proportional to the
production operations. As the size of production rate increases, the variable cost increases. For example, raw
materials, inputs to production, packaging, wages, and commissions, electricity or gas that increases with production
capacity, Commission on sales, credit card fees, wages of part-time staff, etc.
 Average Cost It refers to the per-unit cost of production, which is calculated by dividing the total cost of production
by the total number of units produced. Total Cost = Fixed Cost + Variable Cost Average Cost = Total Cost / Total No.
of units produced
Marginal Cost The marginal cost of production is the change in total production cost when an additional unit of good
is produced or made. Marginal cost is calculated by dividing the change in production costs by the change in quantity.
Opportunity cost Opportunity cost is an economics term which refers to the value of what is given up in order to
choose something else. It is a value of the road not taken.
 Money Cost Money Cost is the cost of production, actual monetary expenditure made by a company in the
production process. Money cost includes all the business expenses such as purchase of raw material, payment of
wages and salaries, payment of rent and other charges of business etc.
 Real Cost Real Cost of production or business operation includes all such expenses/costs of production which may
or may not involve actual monetary expenditure.
 Accounting Cost Accounting Cost includes all such business expenses/production cost that is recorded in the
account book as acceptable expenses of a company. Examples of accounting cost are Cost of Raw Material, Wages
and Salaries, Various Direct and Indirect business Overheads, Depreciation, Taxes etc.
Private Cost Private Cost is the spent for an individual for his or her private expenses such as expense on food
items, rent of house, expenses on clothing, expenses on travel, expenses on entertainment and etc. For a
business/company, this may include expenses like Cost of Raw Material, Salaries and Wages, Rent, Various
Overhead Expenses etc.
 Social Cost This is the cost of natural resources for which the companies are not required to pay anything. For
example, river, lake, atmosphere, and some public utility services such as roadways, drainage systems, street lights
etc.
 Actual Cost Actual cost refers to the cost or expenditure which a company incurs for producing or acquiring a good
or service. The actual costs or expenditures are recorded in the account books of a company. Actual costs are also
called as “Outlay Costs” or “Absolute Costs” or “Acquisition Costs”. For example, Cost of raw materials, Wage Bill
and etc.
 Sunk Cost A cost that has already been incurred and that cannot be recovered in any case and future business
decisions should not be affected by past spent. For example, spending on researching, equipment or machinery
buying, rent, payroll, marketing, or advertising expenses. Sunk costs are also called as “Non-Avoidable costs” or
“Inescapable costs”.
Incremental Cost Incremental cost refers to the extra cost that a company incurs if it manufactures an additional
quantity of products. They are also called as “Avoidable Costs” or “Escapable Costs”

Warehousing strategies:-
1. Use Sales Forecasts : One of the most impactful warehousing strategies to include in your planning is to use
sales data to coordinate your team. Look at both past and future projections to get a sense of how many orders will
come in at any given time. This allows you to schedule your employees more efficiently throughout the week.
Doing this in advance of each quarter gives you time to see potential setbacks before they happen and formulate a
plan. If you have a warehouse with heavy volume, this strategy is a must to keep your team on track and ready to
respond to potential problems.
2. Estimate Your Expenses : It’s possible to increase your bottom line by simply reducing expenses. But without
taking a long, hard look at what you need month-to-month, you won’t be able to be proactive about your warehousing
strategies. For example, if past sales activity shows there’s a lull in dock activity the last week of every month, this is
an opportunity to reduce costs in labor and equipment.
3. Automate : Automation is one of the best warehousing strategies you can use to make your team more efficient.
The type of automation you use is based on where you need operations or analytics support to make sure the
information you’re acting from is accurate. Bad data entry and reporting waste companies time and money each year.
Make sure the technology you choose includes the features that make sense for the needs of your day-to-day
operations.
4. Choose the Right Location : Labor is the driving force of many warehouses. Make sure you choose a location
that gives you access to the best available talent for your warehousing needs.
5. Evict Old Inventory : Unless you’re selling long term storage space, inventory that doesn’t sell is costing you
money. Space is a premium in any warehouse and should be treated like gold.
6. Centralizing Warehouses : A popular warehousing strategy, this is a change from the smaller, regional approach
to warehousing. it is often less expensive to maintain a single large facility than many smaller ones.
The result of this warehousing strategy is more affordable warehousing. In turn, this means more cost-efficient
logistics for customers. We operate one warehouse, centrally located for your convenience.
7. Outsourcing To Third Parties : We’re a third-party logistics provider, so we understand this warehousing strategy
particularly well! Companies who had previously warehoused their own inventory are outsourcing to reputable
companies like our own, as a lower-cost alternative that doesn’t sacrifice on quality.
Ours is a public warehouse, attractive to companies wanting to outsource by renting space for their needs, like
emergency storage or temporary storage. It’s also great for smaller businesses with less inventory, or companies that
need seasonal warehousing.
8. Electronic Monitoring Systems : This type of system deters theft, internal and external. It reduces the number of
people who need to have access to assets, while also protecting them from damage. An electronic monitoring system
is ideal for theft prevention, but it also works well to monitor for fire, flooding, and other natural disasters.
9. Lean Warehouse Operations : Overall, all of these warehousing strategies point to one main practice, which is
lean operations. By optimizing the resources at our fingertips, we reduce the time it takes to:
 handle inventory
 coordinate for effective supply chain management
 look for stock,
 load and unload onto transport

Importance of warehousing services in the logistics system:

Inventory Control : A warehouse helps in seamless and efficient management of large-sized inventories. It assists in
synchronizing the supply with demand in the dynamic market set-up. With a warehouse management system in
place, firms can manage their inventory in real time, with data regarding latest order, shipment, or receipt and any
movement in between. In the long run, this can play a key role in leveraging available resources and expanding the
business.
Centralization of Goods : Warehousing makes it easier to receive, store and distribute the goods as all the goods
are stored in a central location. This helps in reducing transportation costs and increasing the value of goods as
products are available at the right place, at the right time. Various other operations such as order consolidation,
assembling, mixing and cross-docking of products etc. can take place under one roof, thereby adding value to the
overall logistics system.
Economic Benefit : Through efficient operations, warehousing can cut down various expenditures including
outbound delivery costs, shipping costs, transportation costs etc. Through warehouse management, a business can
boost its competitive advantage by improving inventory accuracy, curtailing labor expenses, increasing flexibility and
enhancing customer service plus responsiveness.
Effective utilization of warehouse space : An effective warehouse management also improves the available
warehouse space on a continuous basis by locating the products in relation to receiving, packaging, and shipping
areas systematically and effectively. This improved efficiency can greatly enhance productivity and cut inventory
holding expenses, all of which can pay rich long-term dividends to the firm.
Cost effectiveness : The cost to have your very own dedicated warehouse space to store all of your stock can be
high, especially if you need to employ staff to organise the logistics system and warehouse management.
Outsourcing to a dedicated warehousing company with their own facility will reduce your costs and free up your time.
Warehouse management and fulfilment companies are able to provide dedicated technology and secure facilities
and, some, even services such as temperature control for specific goods.

Warehouse management system overview

A WMS, or warehouse management system, is software that helps companies manage and control daily warehouse
operations, from the moment goods and materials enter a distribution or fulfilment centre until the moment they
leave. WMS software systems are a key component of supply chain management and offer real-time visibility into a
company’s entire inventory, in warehouses and in transit. In addition to inventory management, a WMS offers tools
for picking and packing processes, resource utilisation, analytics, and more.
WMS meaning: a warehouse management system is software that helps companies manage and control daily
warehouse operations, from the moment goods and materials enter a distribution or fulfilment centre until the
moment they leave.

Five benefits of a warehouse management system:

1. Improved operational efficiency: WMS systems automate and streamline warehouse processes from inbound
receipts to outbound deliveries – for improved efficiency, smoother operations, and the ability to handle higher
volumes. They reduce errors in picking and shipping goods and eliminate duplicate and unnecessary work. A
WMS also shares data with ERP and transportation management systems, giving you a holistic outlook that
extends beyond your warehouse and helps expedite the movement of goods.
2. Reduced waste and costs: If you have date-restricted or perishable stock, WMS software can identify which
items need to be picked first, or which might need a sales push, to minimise waste. It can also help you
determine the most effective use of warehouse space, from inventory placement to optimal travel paths. Some
systems offer advanced simulations to create floor plans and place pallets, shelves, and equipment in the best
locations to run at peak efficiency and save time and money.
3. Real-time inventory visibility: Using barcoding, RFID tagging, sensors, or other location tracking methods, a
WMS system gives you real-time insight into your inventory as it moves into your warehouse, around it, and on to
the next location. With this visibility, you can create more accurate demand forecasts, run a just-in-time inventory
strategy, and improve traceability – which is especially important in the event of a recall.
4. Improved labour management: A WMS can help you forecast labour needs, create schedules, optimise travel
time within a warehouse, and assign the right task to the right employee based on skill level, proximity, and other
factors. A good WMS system can also assist in boosting employee morale by creating a more relaxed,
organised, and safe environment where workers feel their time is valued and being used wisely.
5. Better customer and supplier relationships: With a WMS, customers enjoy improved order fulfilment, faster
deliveries, and fewer inaccuracies – which increases their satisfaction and loyalty and improves your brand
reputation. Suppliers can also experience reduced wait times at loading bays and docks, for improved relations

Types of warehouse management systems

There are three main types of WMS software: standalone (on-premise and often a homegrown legacy system), cloud-
based, and applications built into ERP or supply chain management platforms (either on-premise or hosted in the
cloud). Each type of WMS has advantages and drawbacks, and the best type will differ from business to business:
 Standalone WMS: These systems are usually deployed on the company’s own premises using their own
hardware. They can generally support greater customisation (though these can be costly) and the organisation
can maintain tighter control over their data and software. Although the initial cost of the system is substantially
higher than other options, once a company owns it, they own it. At the same time, updates, maintenance, and
the costs associated with them are the responsibility of the organisation. As the WMS ages, it becomes
increasingly difficult to integrate with other platforms and to implement new technologies.
 Cloud WMS: Cloud-based WMS systems can be rapidly deployed with lower up-front costs. Delivered as
software-as-a-service (SaaS), they provide more flexibility to support seasonal and other changing market
conditions – and they are easier to scale as companies grow. Through regular updates, warehouse management
in the cloud offers a quicker path to innovation. And someone else takes on the burden of maintaining and
updating the system. SaaS vendors also invest a lot of money and expertise into security measures and provide
disaster recovery capabilities. Cloud warehouse management systems can also be more easily integrated with
other solutions.
 Integrated ERP and SCM-based WMS: Some warehouse management systems are built as modules or
applications that integrate with ERP and supply chain platforms. The advantage of these is that they are able to
play better with other solutions in overlapping areas, such as accounting and business intelligence. They provide
a holistic view across the business and logistics chain to allow for end-to-end transparency and for warehousing
and logistics processes to be orchestrated and executed together. Ultimately these capabilities can be used to
optimise operations and provide fast, agile fulfilment experiences.

What does a WMS system do/ Features of WMS

Any activities flowing into and out of the warehouse, and those that ripple out to the extended supply chain, can be
improved with a good WMS – from receiving and storage to picking, packing, and shipping. The core features of a
warehouse management system support these activities in the following ways.

Receiving and put-away process : A WMS can help companies receive, process, and put away items in the most
efficient way based on business rules and warehouse flow. Before warehouse management systems, a pen and
paper were used to receive items and reconcile them against purchase orders and physical receipts – and some
smaller warehouses still use that approach today. In fact, in a 2018 Peerless Research survey, 87% of respondents
said they were handling materials manually during the receiving process.
A WMS system supports using RFID technology and integration with billing and other software so that items can be
automatically received, validated, and reconciled against digital purchase orders with the scan of a barcode, and with
labels printed for easier storage and retrieval.
Inventory management : Warehouse management software provides real-time visibility into an organisation’s
inventory across any location, including items in transit and in stores. It provides tracking information using automatic
identification and data capture (AIDC) technology such as barcodes or RFID. And many systems support cycle
counting and demand forecasting using advanced analytics and insights into product and vendor performance. With
these insights, companies can adjust inventory levels on the fly to ensure there’s just enough stock to satisfy
customer demand, whether in-store or online.
Accurate inventory tracking and other practices are key to improving order rates – meaning orders that arrive
complete, on time, undamaged, and with an accurate invoice. They can also help allocate inventory according to
custom workflows and picking logic so that inventory can be moved faster, both into and out of the warehouse.
Order picking, packing, and fulfilment : The most commonly cited place for packing and fulfilment activities is in
the warehouse, according to a Logistics Magazine survey. And ResearchGate estimates that the costs related to
order picking make up 55% of the total cost of warehousing.
WMS systems can help lower these costs by guiding the most efficient way to store, retrieve, and pack products.
They also support picking technologies that streamline the process, such as radio frequency (RF) with and without
scanning verification, pick-to-light and pick-to-voice technology, robotics, and algorithms that can help optimise
picking paths.
Some warehouse management solutions make it easier to fulfil orders using techniques such as single order picking,
batch picking, zone picking, cross-docking, wave picking, “put” to order, put-wall systems, and more – all helping to
streamline order fulfilment.
Shipping : Many warehouse systems integrate with transportation management and logistics software that allows for
myriad ways to expedite the fulfilment process – generating bills of lading, packing lists, and invoices for shipments
automatically, for example, as well as sending out automatic shipment notifications.
With real-time tracking features, companies can keep tabs on whether packages arrive on time and to the correct
destination.
It pays to get this right. Best-in-class warehouse operations get the vast majority of shipments off the dock and in
transit to the destination on time.
labour management : Getting insights into labour-related costs and productivity can help warehouses run leaner,
more efficient operations. A WMS can provide real-time visibility into warehouse workers, labour costs, response
times, productivity gaps, trends to plan, and more – so companies can react accordingly.
Besides providing key insights, many systems also support task interleaving based on factors such as priority or
proximity to help minimise workers’ overall travel time as well as “deadheading” or wasted time. They can also help
with planning and scheduling, either directly or through integration with other systems.
Yard and dock management : Features for yard and dock management can help truck drivers find the right loading
docks quickly. Support for cross-docking, where goods arriving into the warehouse are immediately placed into
outgoing shipments without interim storage, is ideal for fresh grocery products. The software helps with this by
checking receiving scans against current sales orders, then notifying the receiver if the goods should be placed in a
cross-docking location.
Warehouse metrics and analytics : Real-time data can be automatically collected through a WMS instead of relying
on manual data collection methods, eliminating keying errors and drastically speeding up the process. This data can
also be integrated with analytics to track important metrics, such as on-time shipping, inventory accuracy, distribution
costs, order or line fill rate, order cycle time, and more. The system can then create visual reports that can be easily
shared to stakeholders and be used to make adjustments.