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Warehouse Management A Complete Guide To Improving Efficiency and Minimizing Costs in The Modern Warehouse Gwynne Richards
Warehouse Management A Complete Guide To Improving Efficiency and Minimizing Costs in The Modern Warehouse Gwynne Richards
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PRAISE FOR WAREHOUSE MANAGEMENT THIRD
EDITION
‘There are few people in the world with Gwynne Richards’ specialist knowledge and experience. Aligned to
the rapid pace of change in today’s logistics industry, his latest edition of Warehouse Management is an
invaluable tool for understanding best practice in this vitally important business. Seasoned practitioners as well
as the young talent needed by the industry will find this a great source of reference and learning.’ Peter Ward,
Chief Executive, United Kingdom Warehousing Association
‘Warehouse Management, third edition, is an essential “one-stop shop” for both experienced practitioners and
those who want to fully understand the fundamentals of how to manage a business storage facility. This is a
technical topic, yet the book is accessible, with industry terms clearly explained and examples of best practice
provided. Warehouse Management is a must-read for everyone in the supply chain and logistics industries,
business students and those who want to understand more about how to operate a warehouse.’ Phil Wood,
Order to Cash Manager – Northern Europe, Mondelēz International
‘This third edition of Warehouse Management is very welcome and provides great insight into all aspects of the
subject. I know from my work with Gwynne Richards at The University of Warwick that his students
appreciate the book as a source of reference during their studies. It is an invaluable addition to the bookshelves
of students and experienced practitioners alike.’ David James, Director, Subsidiary Management, KNAPP
AG
‘Comprehensive! Warehouse Management is an excellent resource for anyone with warehouse and distribution
responsibilities. This book provides readers with a deep understanding of the principles of warehouse
management and opportunities to improve efficiencies.’ Michael Mikitka, Warehousing Education and
Research Council (WERC)
‘A great resource for students and practitioners. Whether at university or as part of continuing professional
development, Gwynne Richards’ third edition provides timely updates that warehousing and operations
professionals need to know to stay ahead.’ Kevin Richardson, Chief Executive, The Chartered Institute of
Logistics and Transport (CILT) UK
2
Third Edition
Warehouse Management
A complete guide to improving efficiency and
minimizing costs in the modern warehouse
Gwynne Richards
3
Publisher’s note
Every possible effort has been made to ensure that the information contained in this book is accurate
at the time of going to press, and the publisher and authors cannot accept responsibility for any errors
or omissions, however caused. No responsibility for loss or damage occasioned to any person acting, or
refraining from action, as a result of the material in this publication can be accepted by the editor, the
publisher or any of the authors.
First published in Great Britain and the United States in 2011 by Kogan Page Limited
Second edition published in 2014
Third edition published in 2018
Apart from any fair dealing for the purposes of research or private study, or criticism or review, as
permitted under the Copyright, Designs and Patents Act 1988, this publication may only be reproduced,
stored or transmitted, in any form or by any means, with the prior permission in writing of the
publishers, or in the case of reprographic reproduction in accordance with the terms and licences issued
by the CLA. Enquiries concerning reproduction outside these terms should be sent to the publishers at
the undermentioned addresses:
The right of Gwynne Richards to be identified as the author of this work and the right of each
commissioned author of this work to be identified as the author of their contribution has been asserted
by them in accordance with the Copyright, Designs and Patents Act 1988.
4
CONTENTS
Cover
Title Page
Copyright
Contents
List of Figures
List of Tables
Acknowledgements
Introduction
Introduction
Types of warehouse operation
Why do we hold stock?
Warehouse location
Number of warehouses
Supply chain trends affecting warehouses
The growth of e-fulfilment and its effect on the warehouse
Specialized warehousing
Summary and conclusion
Introduction
Warehouse trade-offs
The warehouse manager’s challenges
Lean warehousing
People management
People challenges
Attracting and retaining warehouse employees
An ageing and constantly changing workforce
Operating hours
Training
Warehouse audit
Quality systems
Summary and conclusion
Introduction
Receiving
Pre-receipt
In-handling
Preparation
Offloading
Cross docking
Recording
Quality control
5
Put-away
Summary and conclusion
Introduction
Preparation
Warehouse pick area layout
Summary and conclusion
Introduction
Picker to goods
Goods to picker
Types of automated picking
Examples of automated picking systems
Handling equipment
Storage equipment
Summary and conclusion
06 Order-picking methods
Introduction
Paper pick lists
Pick by label
Pick by voice
Barcode scanning
Radio frequency identification
Pick by light/pick to light
Put to light
Vision pick
Comparisons
Cost of errors
Deciding on type of picking system and equipment
Summary and conclusion
Introduction
Replenishment
Value-adding services
Indirect activities
Stock management
Stock or inventory counting
Cycle counting or perpetual inventory counts
The count itself
Security
Returns processing
Despatch
Documentation
Role of the driver
Summary and conclusion
6
08 Warehouse management systems
Introduction
Why does a company need a WMS?
Choosing a WMS
The process
Selecting the right WMS
What to look for in a system
Selecting a partner
Before the final decision
Implementation
Software as a service
Cloud computing
Summary and conclusion
09 Warehouse layout
Introduction
Data collection and analysis
Space calculations
Aisle width
Other space
Warehouse layout examples
Finding additional space
Summary and conclusion
Introduction
Storage equipment
Storage options
Shuttle technology with a difference
Very high bay warehouses
Other storage media
Warehouse handling equipment
Vertical and horizontal movement
Automated storage and retrieval systems (AS/RS)
Specialized equipment
Recent technical advances
Summary and conclusion
11 Resourcing a warehouse
Introduction
Processing activities
Other factors
Modelling automation
Summary and conclusion
12 Warehouse costs
Introduction
Types of costs
Return on investment (ROI)
7
Traditional versus activity-based costing systems
Charging for shared-user warehouse services
Logistics charging methods
Hybrid
Summary and conclusion
13 Performance management
Introduction
Why do we need to measure?
What should we be measuring?
How to choose the right performance measures
Traditional productivity measures
New performance metrics
Hard and soft measures
Integrated performance models
Benchmarking
Balanced scorecard
Summary and conclusion
14 Outsourcing
Introduction
The outsourcing decision
Core activity/core competence
Cost reduction, cost visibility and economies of scale
Improvement in customer service
Management skills and innovation
Capital investment reduction
Flexibility
Role of third-party contractors
Preparing to outsource
Choosing the right partner
The transition
Managing a third-party relationship
Why contracts fail
The future of outsourcing
Summary and conclusion
Introduction
Risk assessments
Layout and design
Fire safety
Slips and trips
Manual handling
Working at height
Vehicles
Forklift trucks
Warehouse equipment legislation
First aid
Insuring against liability
Summary and conclusion
8
16 The warehouse and the environment
Introduction
Legislation and other pressures
Warehouse energy usage
Energy production
The environment and waste
Packaging
Pallets
Stretchwrap
Cartons
Labelling
Product waste
Waste disposal
Hazardous waste
Forklift trucks
Equipment disposal
Summary and conclusion
Introduction
Context
Views of the future: the landscape
Views of the future: the warehouse
Other advances
Summary and conclusion
9
List of Figures
FIGURE 2.5 5S methodology in the warehouse (adapted from and courtesy of Cerasis Ltd)
FIGURE 3.10 Robotic unloading of container with boom conveyor (courtesy of Bastian Solutions)
10
FIGURE 4.3 Pareto analysis of orders and SKU
FIGURE 4.4 ABC analysis: quantity and frequency of sales (courtesy of ABC
FIGURE 4.10 Rack and shelf layout (adapted from J P van den Berg, 2011 and reproduced by kind
premission)
FIGURE 4.11 Alternative rack layout with racks at right angles to the main aisle
FIGURE 5.17 Typical shelving area for fashion items (courtesy of Joe Fogg)
FIGURE 5.18 Static shelving versus carton flow (courtesy of Cisco Eagle)
11
FIGURE 5.20 Filing drawers
FIGURE 5.25 (Part 1) Pick module selection matrix (courtesy of OPS Design)
FIGURE 5.25 (Part 2) Pick module selection matrix (courtesy of OPS Design)
FIGURE 6.9 Pick rate comparison for the various pick technologies (Wulfraat 2013)
FIGURE 8.1 Advantages of quality information (used with permission of Tompkins Associates)
FIGURE 9.2 Diagram showing the different modules – width, height and length,
FIGURES 9.3 and 9.4 Aisle widths (courtesy of Carson Racking Systems Limited)
FIGURE 10.1 Pallet storage equipment used in UK warehouses (Baker and Perotti 2008)
12
FIGURE 10.5 Drive-in racking (courtesy of Howard Tenens)
FIGURE 10.13 Warehouse capacity graph: euro pallets (courtesy of Constructor Group)
FIGURE 10.30 Articulated forklift truck with sideloading attachment (courtesy of Bendi)
13
FIGURE 11.3 Screenshot of a labour management system courtesy of WCS
FIGURE 13.2 Cost of service improvement (courtesy of Rushton, Croucher and Baker 2010)
FIGURE 14.5 Why outsourced relationships fail (courtesy of Eye for Transport)
FIGURE 15.2 The accident pyramid (adapted from Bird and Germain 1996)
FIGURE 16.1 Warehouse energy usage (courtesy of UKWA 2010 and the CTP)
14
List of Tables
TABLE 3.2 Excel spreadsheet denoting delivery truck booking times by door
TABLE 4.5 Example of product slotting tool (courtesy of John Bartholdi, www.warehouse-science.com)
TABLE 5.1 Shelf storage versus carton flow storage (courtesy of Cisco Eagle)
TABLE 6.1 Pick method comparison (adapted from CILT Warehouse Management course)
TABLE 6.3 Cost and accuracy comparison of the various pick technologies (Wulfraat (2013))
TABLE 12.3 Main warehouse activities and cost drivers (adapted from Griful-Miquela 2001)
15
TABLE 12.4 Example ABC model
TABLE 13.4 Integrated performance model (adapted from and printed with permission of Tompkins
Associates 1998)
TABLE 13.7 WERC performance metrics (2016 and 2017) (courtesy of WERC)
TABLE 14.2 Outsourcing decision matrix (adapted from and used with permission of Tompkins Associates
1998)
TABLE 15.1 Example risk assessment partly completed for the warehouse
16
concepts such as just in time (JIT), efficient consumer response (ECR) and quick response (QR), companies
are continually looking to minimize the amount of stock held and speed up throughput. The use of tools such
as postponement – where products are finalized in the warehouse, not at the manufacturing location – are
becoming commonplace.
We have gone from a ‘push’ to a ‘pull’ supply chain over recent years. In fact, the phrase ‘supply chain’ can
be a bit of a misnomer; rather, it should be called a demand chain, with consumers holding sway.
In the past, manufacturers produced goods and passed them onto the retailers, expecting them to sell as
many of their products as possible. The manufacturers operated a large number of local warehouses and
delivered product direct to store.
This situation changed in the 1980s when retailers took significant control of their supply chains and began
to build national and regional distribution centres. This changed the face of warehousing with a move towards
larger, multi-temperature sites owned by the retailers and in many situations operated by third-party logistics
companies.
These sites continue to grow, with Tesco recently building a 1.2 million square foot warehouse at Teesport
in the United Kingdom and Target in the United States operating a 3.4 million square foot import warehouse
and distribution centre in Rialto, California. The location of these warehouses is also part of a movement
towards port-centric logistics.
Budget supermarket retailer Lidl plans to operate a warehouse at London Gateway, the United Kingdom’s
newest port complex. The siting of warehouses close to ports is not confined to seaports; we are also seeing a
growth in logistics centres in and around airports.
Background
Established in 2001, Tradeport Hong Kong is the only regional distribution centre located at Hong Kong
International Airport (HKIA), which is the world’s busiest cargo airport. Serving 100+ airlines collectively
flying direct to over 190 destinations worldwide, including 40 cities in Mainland China, HKIA handled over
4.5 million tons of air freight during 2016.
The Tradeport operation is a premium-grade logistics centre comprising 300,000 sq ft of space from where
they provide customers with logistics solutions, including vendor-managed inventory, kitting, pick and pack
services.
With its unique on-airport location and highly secure TAPA (Class A)-certified facility, Tradeport
provides logistics services for products that are time-critical, fast-moving and valuable – for example
electronics, luxury items and industrial parts.
Strategically located at the heart of the Pearl River Delta region of southern China, Tradeport’s hinterland
embraces a population of 100 million people, increasingly inter-connected by high-speed rail, road and bridge
infrastructure networks.
The challenge
Tradeport’s initial discussions (back in 2004) with Eurocopter Asia (now Airbus Helicopters Asia) identified a
need to provide a storage-and-service solution for critical spare parts and emergency handling service for over
1,500 helicopters operating in the Asia Pacific region. The spare parts portfolio consists of 16,000 stock
keeping units (SKUs) with inventory replenished on a weekly basis via consolidated air freight shipments from
France and Germany. The geographic territory to be serviced from the Hong Kong hub includes 30 countries
reaching from North Asia down to Australasia and across the Pacific Ocean.
According to Even Lam, Tradeport’s Chief Operating Officer:
the demands were very challenging, including extremely high requirements for speed of response and
service levels. The emergency response element for Aircraft on Ground (AOG) scenarios requires parts
28
being picked and packed, ready for despatch on the next flight out, within a maximum of just two hours
from the phone call requesting support; with the service available around-the-clock, 24/7/365, including on
public holidays.
The solution
Tradeport worked with the customer on developing solutions for the challenging service requirements. It was
clear that taking a pro-active, collaborative approach to tackling the issues would be critical to achieving a
successful outcome.
Due to the 24/7/365 service requirements, Tradeport management engaged closely with all key members of
the front-line operations team throughout the solution development process, in order to finalize a solution
that would work for all stakeholders in the project.
Successful employee engagement resulted in a creative solution for staff involved in the call-out roster,
including targeted changes to remuneration and company provision of mobile equipment, together with
training from the customer.
The benefits
During the past decade, the scope of the programme has developed and grown in line with the customer’s
business needs. The Tradeport spare parts operation is now internationally recognized as providing some of
the best service levels across the entire network of Airbus Helicopters.
Tradeport’s Chief Executive Officer, Kenneth Bell adds:
Engaging the key stakeholders from the outset – including our staff, who ultimately have to deliver on these
high service standards, day-in and day-out – was a fundamental step in empowering the whole team with
the confidence to make it happen.
The trend towards outsourcing Western production eastwards has resulted in companies having to hold
higher levels of finished goods stock than previously. This is to cover the extended lead time between
production and final delivery.
Containers from Shanghai to the United Kingdom, for example, can take upwards of 31 days, not including
clearance at the port of entry.
Video 1.1 shows a Samsung television being moved between a UK port and a customer. Note the role of
warehouses in this operation including at the store.
The recent elections in the United States and Europe and the United Kingdom’s planned exit from the
European Union potentially point towards anti-globalization and a more protectionist approach with the
opportunity to bring production closer to the point of consumption. This could well have an impact in the
future as we see unparalleled uncertainty within today’s supply chains.
29
Another random document with
no related content on Scribd:
It is fair, however, to assume that there must be a capacity for
serious results in the vibratory jar, as the discoverable lesions in
many well-examined cases have been in themselves insufficient to
kill. The rapidity of recovery of those who get well also bears weight
on this point.
Much has been said and written about the condition of the pupils in
concussion of the brain. I have made this matter a subject of
observation, and am convinced that the state of the pupils is of no
diagnostic value whatever as to determining the existence of
concussion or compression. Their state is of great value in telling us
that the functions of certain brain-centres are partially or wholly
impaired. The progress of the case will tell us whether the
impairment is due to clot or effusion, congestion or jar.
One case I can call to mind where the opinion of the attending
physician was only changed by the ultimate favorable result, which
left no sign of permanent injury of any kind. These cases are
particularly apt to occur with children.
I remember also another source of deception. A boy was severely
injured by a blow upon the forehead. Concussion was marked. There
was a lacerated wound reaching to the edge of the orbit; fractured
bone could be felt, and at first sight what appeared to be brain-
matter was oozing from the wound. A hasty unfavorable prognosis
was given to the parents. On closer examination it was found that
the fracture was of the external wall of the frontal sinus, and the
supposed brain-matter was the delicate fat-lobules of the orbit. The
patient recovered rapidly.
The convulsions of the epileptic, the foaming mouth, and the quick
return to partial or complete consciousness will generally serve to
distinguish the case from one of concussion, but at times there are
those who require also to be kept under observation for some hours,
and even a day or more, in order to come to a correct conclusion.
The more serious cases equally require rest, but also something
more. To bring about reaction from shock, sinapisms to the
extremities, to the nape of the neck, and over the stomach should be
used. Hot-water bags should be placed along the sides of the body
and limbs. Alcoholic stimulants must be sparingly used, if at all: they
are rarely necessary. The stomach will often reject them unless in
minute doses. If too much is absorbed, unpleasant consequences to
the brain may follow. In extreme cases hypodermic injections of
brandy or ether may be administered. Ammonia, camphor, and other
diffusible stimulants may be useful, either externally or internally.
The result only in these severe cases will determine whether the
symptoms were due to great congestion or to extravasation, possibly
with brain lesion. Complete recovery takes place in the first
condition. In the latter a fatal termination is much more probable, and
if there is recovery it is apt to be only partial, and the patient may be
the victim of nervous troubles more or less pronounced throughout a
long life.
Concussion of the Spine.
Thus we see that the cord is much more securely protected from the
effects of external violence than the brain, and we can understand
that there is reason for the doubt of the sceptics as to the frequency
of the injury described as concussion of the spine.
I italicise the last sentence. In 1881 a boy came under my care who
was shot in the back three inches to the right of the third or fourth
dorsal vertebra. He at once had characteristic symptoms in the legs
of being wounded in the spine in such a way as to affect the cord
somehow. There was partial paraplegia, with pains in both limbs.
Under rest these symptoms soon disappeared. In a few days I made
a deep incision and removed some clothing and fragments of bone,
and then from the depths of the spinal gutter I took a large conical
ball which was resting against the bony bridge of a vertebra. The boy
recovered rapidly. I saw him some months afterward perfectly well.
I cannot now, after thirty years of hospital and private practice, call to
mind a single case of concussion of the spine arising from other
accidents than on railways which has had the terrible after-history
that is so often attributed to them; and I have seen in that time many
cases of spinal injuries of all kinds.
I will state in passing that this case did not confirm the views of
Johnson and others as to there not being any severe pain on
pressure in myelitis. It showed also that clinical observation is not
always in accord with plausible anatomical facts or reasoning.
Now, in this case the pain was simply atrocious and greatly
increased by pressure. To relieve both it and the disease the actual
cautery was applied on both sides of the spinous processes; and
some estimate may be made of the sufferings of the patient, who
would not take ether, when he exclaimed as the hot irons were
burning through his tissues, “Oh, that is better than the pain.”
To sum up, then, I think I have shown that concussion of the spinal
cord proper occurs. I also believe it may occur in a railway collision
just as it occurred in the man who fell twenty feet. Why should not a
traveller sitting in a peculiar position—with his feet, for example,
firmly against a partition or wall of the car—suffer it in a collision.
On the other hand, the great majority of those who after accidents
claim injury to the spinal cord as the cause of their disabilities are
wholly mistaken. The question is of great importance, for upon it
depends the testimony as to whether the patient has sustained
temporary or permanent injury.
The practitioner may very properly, and without laying himself open
to criticism of his diagnostic accuracy, return the cause of death in a
case of sudden death, or where his opportunity for observation has
been limited, or where no post-mortem examination has been held,
as being apoplexy; but in others, where the symptoms were decisive
or a post-mortem has disclosed the exact lesion, the condition of the
cranial contents should be stated. It is also a not uncommon mistake
—or rather piece of carelessness—to speak of small hemorrhages in
the brain as small apoplexies. A small extravasation may give rise to
slight symptoms or next to none, but a real apoplexy can hardly be
small, although it may be short.
The root from which the word apoplexy is derived seems to have
been used by the classic writers in something like its present clinical
signification (Απορληκτος, seized with (apoplexy or) stupor—
Aristophanes; mad—Demosthenes; Αποπλησσομαι, to be struck with
amazement—Sophocles). Morbus attonitus, another of its names,
expresses a somewhat similar idea.
Cerebral softening has been recognized since the early part of the
present century, and in some of the cases thirty years ago an
efficient cause, in the form of arterial disease, assigned to it; but the
complete theory of its causation forms a part of the general doctrine
of embolism and thrombosis which was so largely developed and
systematized by Virchow. Andral and Durand-Fardel had apparently
no idea of the exact mechanism of its origin, the latter supposing it to
depend upon inflammation, while Todd mentions a case where
softening giving rise to paralysis depended upon a dissecting
aneurism of the carotid. He seems to have generalized so far as to
say that white softening is atrophic, but the precise way in which this
localized atrophy was usually brought about evidently escaped him.
According to him, the suddenness of the attack was owing to a
gradual disorganization of the brain-substance with few or no
symptoms, and then a sudden rupture of diseased fibres by some
accidental cause or by their having reached the extreme limit of
cohesion.
Blood may be effused upon the surface of the brain in the so-called
cavity of the arachnoid—that is, outside of the pia mater—or in the
meshes of this membrane, following its course along the sulci. This
also is not infrequently the result of violence either with or without
fracture of the bone. Its source is likely to be found in the veins which
empty into the longitudinal sinus from the surface of the brain.
Rupture of a lateral sinus from a not very severe blow has been the
source of large and fatal hemorrhage.1 Blows upon the head, with or
without fracture of the cranial bones, are likely to cause rupture of
the cerebral substance with hemorrhage, and this may find its way to
the outside and cover more or less of the surface. Such injuries to
the brain, it is important to note, do not necessarily correspond
immediately to the place of the blow or to the external ecchymoses.
Meningeal hemorrhage in this region may, however, be observed
when no injury has been received, or at least when there is neither
history nor external traces of any.
1 Cincinnati Clinic, p. 135, 1874.
The conditions under which it occurs may not vary greatly from those
of the more ordinary intracerebral effusion. In two instances under
the observation of the writer the source of hemorrhage has been a
vessel of small, but not the smallest, calibre (artery), situated near
the fissure of Sylvius, in the lower parietal or temporo-occipital lobe.
In children meningeal hemorrhage is, with only a few exceptions, the
usual lesion of apoplexy. The blood is usually dark and coagulated in
recent cases. Blood found under the membranes where no fracture
has taken place is, however, more likely to have been derived from
the brain-substance and to form part of a cerebral hemorrhage.
The changes taking place in the clot itself within the first few days
are not very marked, but the walls of the cavity may become softer
and more deeply colored, at first red and afterward yellow. Blood-
crystals have been detected on the seventeenth day (Virchow). The
following descriptions have been given of clots of different ages:
Eleven days—reddish-yellow softening clot, with brain-tissue stained
for half an inch in depth, and brain rather hard in vicinity. Eighteen
days—cavity with its edges anteriorly and superiorly sharply defined,
with the edges posteriorly ragged and yellowish, filled with a