Stores & Warehouse Operations and Mgmt

8/6/2019 Stores & Warehouse Operations and Mgmt

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1. Stores & Warehouse Organisation

1.1 The Purposes and Functions of the Stores/Warehouse

1.2 Stores & Warehouse Construction

1.2.1 The Building

1.2.2 Large-Scale Equipment

1.2.3 Floors and Floor Flatness

1.2.4 The Loading Bay

1.2.5 Other Important Areas

Doors

Lighting

Picking Areas

Special Storage Areas

Ancilliary Service Areas

1.2.6 Gathering Data

Pallet spacePick popularity

Volume movement

Pick density

1.2.7 Changes in Modern Stores Design

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1.3 Storage Options

1.3.1 Shelves and Bins

1.3.2 Racking (Non-Pallet)

1.3.3 Pallet Racking (Various)

1.4 Allocating Storage to StockCharacteristics and appropriateness of racking systems

1.5 Allocating Stock to Storage (Pick Density and 'The Golden Zone')

1.6 Material Flow Planning (Layout)

The Use of Simulation in Material Flow Planning

1.7 The Installation of Automation

1.8 Coding and the Stores 'Vocabulary'

1.9 Installing Technology

1.9.1 Batch v. On-Line

Batch

On-Line

1.9.2 Data Recording Equipment

1.9.3 Voice Directed Picking (but see 4.2.7 below)

1.9.4 Data Communications1.9.5 Weighing and Measuring Devices

Weigh counting

1.9.6 Bar Coding & RFID Tags

Bar Coding

RFID Tags

1.10 Special Situations

1.10.1 Stockyards

Construction

Repairs and Maintenance

Layout and Organisation

1.10.2 Cold Stores




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1.10.3 Tools Stores

2. Materials & Material Handling

2.1 Knowledge and Protection of Materials (including FIFO)

2.2 Pallets and Unit Loads

2.2.1 The Pallet2.2.2 The Unit Load

2.2.3 Pallet Loss

2.2.4 Pallet Stacking

2.3 Packaging

2.3.1 The Package

2.3.2 Packaging Waste

PRN (package recovery note)

WEEE regulations

2.4 Materials Handling

2.4.1 Introduction

2.4.2 Equipment for Seizing and Lifting

2.4.3 Hand Operated Equipment

2.4.4 Power Driven Equipment2.4.5 Cranes

2.4.6 Order Pickers

2.4.7 Powered Conveyors

(For carousels, see 4.2.6)

2.4.8 AGVs

2.4.9 Training and the 5 Rules

2.4.10 Avoidance of Double Handling

2.5 Transport and Despatch

2.5.1 Regulations and Safety

2.5.2 Road

2.5.3 Rail




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2.5.4 Ship

2.5.5 Air

2.5.6 Arranging Transport - The Freight Forwarding Agent

2.5.7 Route Planning Software

3. Stores and Warehouse Operations3.1 The Carriage of Goods (The INCOTERMS)

3.2 The Transfer of Goods and the Law

3.3 The Principal Steps and Official Notes in Ordering and Receipt

3.4 Quality and the Receipt of Goods

3.4.1 Introduction

3.4.2 The Main Decision on Incoming Quality (The Breakeven Point)

3.4.3 The Inspection of Incoming Parts by the Stores

3.4.4 The Sampling of Incoming Parts

Sampling plans explained

Single Sampling

Double Sampling

3.5 The Issue and Despatch of Material

3.5.1 Stores Issues within the FactoryProcedures for stores issues

3.5.2 Despatches outside the Factory

3.5.3 Load Assembly within the Factory

4. Special Topics

4.1 Variable (Random) v. Fixed Locations

The Magic Number Method

Requirements of a 'Putaway' Software system

4.2 Order Picking

4.2.1 Cost and Picking Performance

4.2.2 Reducing Travelling Time in Picking

4.2.3 One-Step Picking




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Picking Multi-Line Orders

Zonal (or Sectional Picking)

Dynamic Zoning

4.2.4 Two-Step Order Picking

4.2.5 Technology I - Picker to Stock4.2.6 Technology II - Stock to Picker

Horizontal and vertical carousels

4.2.7 Voice Directed Picking

4.3 The Maintenance of Stock Records

4.3.1 How the Stock Records System Works

4.3.2 What is meant by 'Records Accuracy'

4.3.3 Improving the System

Causes of Error in Stock Records Recording

4.3.4 Controlled Stores Accuracy

4.4 Cycle Counting (including off-site link to Stock Accuracy Course)

4.5 The Financial Control of Stock

4.5.1 The Custodianship of Assets

4.5.2 Financial Reporting4.5.3 Managing Stock Losses

4.6 Transaction, or 'Audit' Trails

4.6.1 Defining a Transaction Trail

4.6.2 The Reconciliation of a Stock Count

5. Human Resources

5.1 Recruitment and Selection

5.1.1 Staff Recruitment

5.1.2 Staff Selection

5.1.3 The Job Offer

5.2 Industrial Relations in the Stores/Warehouse

5.2.1 Grievances




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5.2.2 Breach of Contract

5.2.3 Discipline

5.3 Fire Precautions

5.4 Security

Internal Theft5.5 Pests in Stores and Warehouses

5.6 Health and Safety in the Stores

5.6.1 Personal Responsibility

5.6.2 Criminal Liability

5.6.3 Civil Liability

5.7 Reviewing the Stores Performance

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1. Stores and Warehouse Organisation

1.1 The Purposes of the Stores / Warehouse

The stores is self-evidently a major company service department. Service is provided on behalf of thefollowing functions:

Service to Purchasing & Quality:

The stores receives raw materials and bought-out parts on behalf of Purchasing. The receiptsmust therefore be counted accurately and the material checked or sampled as to quality.Information about receipts must be promptly notified to the central database.

Service to Production:

The stores must marshal and issue all works orders on behalf of production, and perhaps anytools and fittings needed. The stores also accepts material from production, whether completedwork or scrap. The nature of production is such that emergency issues of material are alwayslikely to be required. It would follow from this for a factory stores that the facility should providea service during all times that production takes place ... including second and third shifts.

Service to Production Planning:

The planning of production and the correct maintenance of stocks are essential services as thecompany progresses manufacture, but these tasks simply cannot sensibly proceed unless thestores/warehouse correctly maintain stock records at a very high level of accuracy.

Service to Distribution (Logistics):

The stores or warehouse must prepare goods for despatch to external customers within aturnaround time that has been agreed between its manager, the distribution manager andtransport supervision. The function of despatch includes packaging and, perhaps, making readyall documentation.




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Service to Field Service or Engineering:

There may be a requirement to hold and dispense spares for machines both within the factory orinstalled at customers' premises on a 24-hour basis. The stores' role in providing this serviceentails call-outs ... not merely leaving a key with security.

Service to Finance (and Senior Management):

Stock is regarded for financial purposes as a current asset of the company - ie an asset of the samenature as cash and debtors - so that consequently Stores' maintenance of accurate records is avital contribution to company management. The accuracy of the records is not merely an issue atyear end when the balance sheet is being struck. On going accuracy is needed continually forintegrated financial accounting purposes.

Other important functions of the stores relate simply to the internal good management of the facility. Obviousexamples are the safe and economical handling of material; and security from fire and theft. As well, there isa requirement to maintain stock in good condition. (It is rarely accepted, however, that the stores orwarehouse is responsible for the ordering, forecasting or replenishment of stock itself, except perhapsinexpensive consumable items or fuel in the course of operating a simple "2-bin replenishment" system . Wemust return to the question of purpose and function in the final Section of this on-line course, when thematter is discussed as to how well the stores has performed and the need for its continuous improvement.

Also visit the website ofThe UK Warehousing Association.Return to AgendaReturn to top of AgendaGo to Top of CourseGo to endNext Section

1.2 Stores & Warehouse Construction

1.2.1 The Building

A single storey building is almost always to be preferred - it is cheaper to constructand it is cheaper to fit out with ancillary services. Above all, a single storey is moresuitable for fork lift trucks which, in a multi-level facility, would otherwise needsometimes to go from level to level via lifts. Although single storey buildings arenowadays the norm, there are two ways in which some of the advantages of a two

storey building can be obtained. The first is by the construction within the warehouseof amezzanine floor for offices and limited specialised sub-stores. The second is tohavemulti-tiered binning. This consists of stacking one run of shelving, say 3m high,on another that is also 3m high. A floor is then provided for storesmen at the higher3m level. It should be noted, however, that a disadvantage with both mezzanines andmulti-tiering is the exclusion of natural light at the lower levels. This forces upoperating costs due to the need for artificial lighting, and may lead to accidents.(Inadequate lighting is a major cause of accidents generally.) Of course, if the newstores needs to be in the centre of a major city, land prices may force the company todevelop a multi-storey facility.

Multi-storey warehouses can be successful if care is taken to 'zone' the stored materialcarefully. Typical zoning schemes are: (i) high and low pick densities (see later); and(ii) bulk stock / back-up stock / picking stock. A financial reason for single-storey is

given in the relationship between the cost of the construction, worked out in percubic metre of space obtained, and the (single storey) height to the eaves. This can beillustrated by a graph showing how the relative cost per cubic metre of space createdfalls exponentially as the overall height of a building rises. As a rough estimate, a 12metre high building would cost only 15% more than a 6 metre building. However, a 12metre (tall) warehouse would show major cost savings over a 6 metre (more extensive)warehouse of the same racking capacity, with savings in land costs, rates, heating etc..Perhaps as important as this is the resale value of the warehouse, as more and morecompanies are looking for new premises and focus on buildings well over 6 m high.

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1.2.2 Large Scale Equipment

A two-stage approach can be used to work out the best system of materials handling.First, the best or most likely range of units loads of incoming materials is determined:size, weight, frequency etc.. This will enable the equipment to be decided that isnecessary to handle them, and the design of the receiving docks. Secondly, the unitloads required by the company's own customers are considered, so that the equipmentneeded at this end of the materials handling system can be determined. (For example,

consider the requirements to fit out a supermarket ... receiving docks and fork lifttrucks are necessary to deal with incoming cartons brought in from the retailer'sdepot, and wire trolleys and trolley parks are needed to deal with the carrying away ofcustomers' weekly groceries to their cars.)


1.2.3 Flooring and Floor Flatness

Floors are always of concrete, sometimes treated with compounds to reduce slippageand to minimise dust and grit. Specialist contractors must be employed to lay them,capable of constructing them to the required high standards of flatness and deliveringthe required degree of durability.

Flatness is especially important: if a floor is not flat, fork lift trucks will slow downand may collide with racking. But what is flat? To answer, consider an elevationdifference of 10mm across a 1500mm aisle. Put a narrow aisle truck on the floor atthis level and raise its cab 15m. Now the 10mm difference has become a 100mm staticlean. At speed, that 100mm lean becomes a lean of 300mm. Floor flatness is specifiedby BS8204 (Part 2). Floors should have an elevation difference of less than 3mm.Flatness is measured by a prophilograph machine, which traces the floor contourselectronically. An uneven floor can be flattened by a laser-guided grinding machine,or, alternatively, a new floor can be laid as an apron on the old one.


1.2.4 The Loading BayLoading bays are positioned so that vehicles can have direct, unhindered access tothem without the need for complicated manoeuvring. Among other things, easy accesswill speed the loading and unloading processes and may even reduce the need forextra bays. A key decision is whether to allow for side loading or end loading ofvehicles.End loading offers many advantages. Although it restricts access to only onepart of the load, the narrower width is such that than one can get two bays in a space,compared to one with side loading. End loading also provides better temperaturecontrol and greater safety. (Loading bays are a particularly critical area for safety ...25% of all industrial accidents occur in this area). Note incidentally, that clockwisecirculation of traffic up to the loading bays is required to provide better driver controlof the reversing turn into the bay. The construction of the loading bay must clearlyallow for modern materials handling equipment and practices. Doors should be 9 ft,

or a little more for higher trailers. The height of the loading bay platform mustaccommodate any number of vehicle types and make allowance for the fact thatvehicle heights rise and fall during the loading and unloading processes. The usual(very cost effective) solution nowadays is to buildpermanent docks levellers. As forlocation, two common practices are diametrically opposed to each other. One is tolocate both the receiving and despatch bays next to each other. The other is to putthem as far apart as possible! However, with modern communications and materialshandling, it may be more effective to place bays at several points around the buildingto allow direct pick-up and easy despatch by factory departments. If this is done, ofcourse, all such bays must be centrally controlled and berth activity supervised. Thequestion of how many loading/unloading bays should be provided in the constructionof the stores or warehouse can be decided best through the use of a simulation model




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as described below.


1.2.5 Other Important Areas

Further vital topics which must be dealt with include those in the list below. Perhaps

the most important point, however, is that the stores should be designed, at least inrough, by stores staff themselves - it will be realised that an inadequately plannedfacility can have massive, permanent on-going effects on operational costs. Forexample, failure to obtain the know-how and inside knowledge of staff may resultlater in queues; excessive waiting times for drivers or shop floor operators; doublehandling; and delays in clearing materials for use.

(a) Doors

For the sakes of security and to minimise heating costs, instal only those doors whichare essential. Aspects of doors to consider are from (1) to (5) as follows - or perhaps acombinations of them is required ... (1) their speed (speed is clearly important fordoors to cold areas); (2) whether automatic control is desirable; (3) security; (4)thermal efficiency: (5) whether specialist factors apply, such as use as fire shutters,

extra high security or heavy duty. How much traffic will use the door and what typesof traffic will it be? Alternative door types are (i) sectional insulated overhead doors('up and over' doors, or Thermadoors), which may be standard, or normal, lift, highlift or low lift, (ii) Rapid Roll doors. An essential accompaniment to internal doors iseither a traffic light or one-way system. (Warning klaxons are an additionalsafeguard.) Door control activators should also be given attention - it is grosslyinefficient if drivers of FLTs need to dismount to open/close the door. The necessityfor high speed, insulated doors is dealt with under Cold Stores.

(b) Lighting

Ensure that the fullest possible advantage is taken of natural light, especially ingangways and passages, so make sure shelves and racks when they are installed willnot obscure windows. (Windows of continuous glazing with wired glass.) Inadequate

lighting can make it difficult to read documents, labels and screens. Anto-glare filtersshould also be considered. (On the matter of clarity of documents, ensure that bold,clear fonts are used and that the pitch of letters and numbers is sufficiently large.)(c) Picking Areas

Dealt with below.

(d) Special Storage Areas.

Heavy goods, bins, safes and others may be zoned into special stores areas to be laidout in conjunction with the main pallet racking.

(e) Ancillary Services Areas.

These are: the boiler house; electricity sub-station; garage; fuel pumps; canteens;toilets; car parks; first aid stations, etc..


1.2.6 Gathering Data

(A) Calculating Pallet Space

The following simple six step procedure can be used to find the average palletised area




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that will be occupied by a case or package.

i. If the cases are to be stacked on a pallet, find the number ofcases per tier on each pallet and the number of tiers per pallet.For example, 5 cases per tier and 4 tiers per pallet = 20 casesper pallet.

ii. Decide the maximum number of pallets per stack. Forexample, with 3 pallets per stack, the number of cases is 20 3= 60.

iii. Each stack occupies the area of one pallet, plus, say, 1.5 cmsoverhang on each side. The area is thus 1030 mm 1230 mm,= 103 cm 123 cm = 12,670 sq cm, or 1.267 sq metres perstack.

iv. The gross area in iii. is reduced to 60% net after allowingfor aisles, staging areas and offices. Thus net area is 1.267 / .6= 2.11 sq metres per stack.

v. We must now allow 20% wasted space forhoneycombing, sothat the actual space per stack is 2.11 / .8 = 2.64 square metres.

vi. The area per case for planning purposes is therefore 2.64 /60 square metres per case, = 0.044 square metres per case.(For example, if stacking 2,000 cases, allow 2000 0.044square metres = 88 square metres.)

(B) Calculating Pick Popularity (P)

Analyse existing data such as the stock records transaction trail and record the totalnumber of picks plus putaways per item per month. If the file holding this data issorted into descending order of the number of picks + putaways, it will be found thatthe top 20% of the items account for 80% of the total number of picks + putaways ...the familiar ABC effect.

(C) Calculating Volume Movement (V).

From the data in (B), apply the volume of each item V. This is defined as V = T C,where T = the average total number of units of the item put away and withdrawn permonth and C = physical volume of each unit - ie the space occupied by one item,measured in cubic centimetres (or cubic feet). That is, volume movement is the volumeof each item stored and picked per month. Analysis of items in descending order ofvolume movement will show typically that 15% of items account for some 80% of thetotal volume movement. Of equal interest to the stores planner is the fact that 50% ofthe items account for less than 0.5% of the total volume movement.

(D) Calculating Pick Density (D)

If P = the average number of putaways and withdrawals per month for an item, and V

is its volume movement, then each item's pick density D = P / V. Pick density is neededin determining storage location, as explained further below. Hint: In order to find thevolume of a small item, institute a "measuring cup" of fixed volume ( say 100 cc) anddetermine how many units will fit in a cup. For large items, imagine them being in abox, and apply a tape measure to the imaginary box.


1.2.7 Changes in Modern Stores Design

The stores designer today must be very conscious of the rapidity of change taking




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place in the tempo of modern manufacturing. With Just-in-Time supplier receipts,kanban and JIT deliveries, the quantities of stock ordered from suppliers,manufacturing lot sizes and the delivery quantities demanded by customers arebecoming progressively smaller and their frequency of movement correspondinglygreater. So while in the past the emphasis in design was on economy of storagedensity, todays emphasis is on speed and flexibility. Issues today are traffic jams andthe quick attention to incoming goods and shop floor receipts.

Return to AgendaReturn to top of AgendaGo to Top of CourseGo to endNext Section1.3 Storage Options

Storage options here means the stores or warehouse 'furniture' - the physical containers, shelving and the restused to contain the items being stored. Note that the termstores furniture seems to imply that the fixtures andfittings are static and the goods within them are at rest. It is possible, however to install what is termed 'live'storage facilities. With live storage, either the goods themselves move, or the equipment moves, or both. Anexample of live storage where the goods alone move is achute.


1.3.1 Shelves and BinsOpen shelving is suitable for items within strong packages, such as small boxes ofcomponents. A working ledge at the front is typically provided for counting out itemsbeing picked. Closed shelving usually means closed at the back and is more common.It is suitable for non-packaged goods and can be fitted with shelf trays. Lockablefronts may be provided. Ashelving bay means a single multi-shelf construction ... ieone unit of shelving from the equipment supplier. By bolting several bays togetherside-by-side, we form a 'run'. A very strong, stable structure is formed when two runsare bolted together back to back, and, as indicated above, runs can also be stacked intiers. Guidelines on shelving are contained in BS826, specifying preferred dimensions.


1.3.2 Racking (Non-Pallet)The term "racking" is applied to any storage fixture that is not shelving or binning.Racking is used for the storage of an enormous variety of goods - pallets themselves,tyres, cables, bars, tubes, drums ... The layout of racking must be given the greatestattention at the design stage, since the decisions made will have a considerable effecton the utilisation of floor space (and volume) and on the speed and efficiency ofstoring and picking.

A common requirement in industrial stores is for racking for bars and tubes. Thebasic options are to hold the stock either horizontally or vertically. The preference isusually for horizontal racking. This may be eitherpigeon hole orantler ('horn').Pigeon hole racking consists of angle irons in which the bars are stored together. A

disadvantage of it is that mechanical handling is difficult. With the antler method, theracking consists of a framework of angle irons, so that each bar is stored in anindividual slot like bottles in a wine rack, making mechanical handling easy.Horizontal racking clearly demands corresponding horizontal working space, and ifthis is limited compared to height, vertical racking may be preferred. Two problemswith this are (1) that the bar or tubing may become distorted due to the pressure of itsown weight; and (2) the greater safety hazard it presents.

Note that warehouse racking is regulated under the Construction (Design andManagement) Regulations ('CDM'), part of the Health & Safety at Work Act. TheCDM regulations were amended and re-issued in April 2007. Although racking in awarehouse may seem a long way from a building site, the Health & Safety Executive




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classifies the installation of racking as a construction project. To comply with theCDM regulations, companies must ensure that a health and safety plan has beendevelopedbefore any construction work begins. A health and safety file that isavailable for inspection at any given time must also be produced. The preparation ofthe plan is the responsibility of the warehouse manager. It will usually begin with adescription of the 'project' and a general statement of health and safety principles andobjectives of the work. It will include arrangements for managing and organising theproject, and include the identity of those responsible for the actual erection.


1.3.3 Pallet Racking

There are a great many standard storage arrangements for pallet racking. The Storesplanner can decide on the configuration suitable for a specific need simply bycontemplating a standard layout, the type of material to be stored and thepicking/putting away rates to be achieved. Seven standard arrangements are givenbelow, with very brief comments on each. Their pro's and con's are summarisedbelow.

(i) Block Stacking

Unit loads are stacked on top of each other, and stored on the floor in storage lanes("blocks"), two to ten deep. Block stacking is suitable only for a very limited numberof different items, where product quantities are large and/or where productsthemselves are bulky and turnover is high. Very high storage density is achievedthough ease of access is not good. Also note that block stacking is strictly LIFO (seebelow), so that if FIFO is necessary, block stacking is not a feasible option.

(ii) Single and Double Deep Pallet Racking

Single deep racking is a simple system that is associated with pallet racking forpicking faces (see Two-Step Picking later). It allows immediate access to every loadstored. A major disadvantage, however, is the loss of some 60% of floor space to aisles.Double deep pallet racking is merely an extension of single with less loss of space to

aisles (but with more honeycombing).

(iii) Drive In and Drive Thru Racking

The racking consists of upright columns with horizontal rails to support pallets.Storage lanes of the chosen depth reduce space lost to aisles even more. High density,but suitable only for low/ medium thruput items. LIFO only. Drive thru merely meansaccess from two sides.

(iv) Pallet Flow Racking

This superior though expensive system is similar to Drive In Racking, except thatloads are moved on skate wheel conveyors. As a load is removed from the front of thestorage lane, the next lane advances to the picking face. Pallet flow racking gives high

throughput and good space utilisation, and permits FIFO. It is used for high density,high thruput storage, but costs some 200 per storage position.

(v) Push-Back Racks

As a load is placed in storage, its weight and the force of the FLT (fork lift truck)pushes back the other loads in the lane. As a load is removed, the rear loads pushforward. Expensive and LIFO.

(vi) Mobile Pallet Racks

Whole rows of rack are moved forward together, eliminating aisles.




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Safety is a most important concern with all racking. Training must be given by theequipment manufacturer and the greatest care exercised to ensure loads are evenly

distributed and that they never exceed the manufacturer's limits. Operating conditionsmust also be satisfactory, such as lighting and working space, and the rackinginstallation must be rigorously inspected on a regular basis, not simply when someone'notices something is wrong'... For Racking Safety Trainining, visit SESS.


1.4 Allocating Storage to Stock

The first task is to obtain and analyse the volume movement of all items so that the correct storage capacitycan duly be assigned to the items to be stored. The four principles which the planner will typically follow are:

1. Low volume movement; high popularity:

These items should be assigned to very productive, low volume storage media - forexample, carousels (see below).

2. Low volume movement; low popularity:

Expensive storage media cannot be justified for these items. The media selected forthem will be storage drawers and bin shelving.

3. High volume movement; high popularity:

These items must be stored in pallet racking systems that lend themselves to frequentpicking and restocking, such as flow racks and single deep racking.

4. High volume movement; low popularity:

Other, less expensive styles of racking will typically be chosen.

Consideration should be given to the relative merits of the seven types of pallet racking described in theprevious sub-session. The characteristics and appropriateness of the seven systems are summarised in the

following table.

Characteristics and Appropriateness of Racking Systems

....................................Cost .Storage Density .Load Access .Thruput Capacity .FIFO? Variabl Load Sizes?

Block Storage ........................n/a..............v.good............................poor ............................average...................y.............................good

Stacking Frames....................low..............good...............................poor.................................poor.....................n.............................poor

Sing/Dou Deep ......................low..............good..........................good/OK.........................good/OK................poor......................averageDrive In/Thru ........................ low...............good.............................good...............................average..............difficult......................poor

Flow Racks..............................high..............good............................good.................................v.good..................yes............................poorPush Bk...................................high...............good.............................v.good...........................average..............difficult...................averageMobile.......................................high..............v.good............................poor................................v.poor...................no.........................averageAs we see from the table, both relative volume movement and relative picking popularity are taken intoaccount in working out required storage volume and determining the specific storage media to be installed.Relative volume movement and relative popularity are consequently taken into account in determining where"regions" of stock and storage media are to be located. In short, where both volume movement andpopularity are high, flow racking might be best. Where volume movement is low, then we might turn to (1)storage draws (low popularity); (2) bins and shelves (medium popularity); and (3) carousels (high popularity).




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1.5 Allocating Stock to Storage (Pick Density and 'Golden Zone')

For a very small number of special items, the decision as to which locations they are to be assigned for storagewill be made on an individual basis. For example, precious metals will be located in safes and material likelyto give off fumes will be located in well ventilated areas. The decisions for the great majority of items within a

general storage region, however, will be made after first considering how easy (quick) it is to put away into, orpick from, those locations. In stores jargon, the locations where these activities may most easily beaccomplished are referred to as "the golden zone" - locations which are between waist and shoulder high, andare close to a central point in the stores. Next come locations in the "the silver zone". Finally, the slowest andmost distant locations make up "the bronze zone". Nominating locations and zones is the first task in decidingwhat to put where.

At first thought, it seems intuitive that the criterion for deciding which items are to be assigned to the goldenzone should be on the basis of their popularity. However, popularity alone ignores the fact that the storesplanner is trying to optimise the use of the golden zone, and that consequently he should also take intoaccount how much space is taken up by items. What he wishes to do is to maximise the degree of picking thattakes place there. Consequently, the notion ofpick density, previously defined, must be examined further.

As previously stated, if P = the average number of putaways and withdrawals per month for an item (ie

popularity) , and V is its volume movement, then each item's pick density D = P / V.

The planner must calculate the pick density of each item within a stores region and allocate the group of itemswith the highest pick densities to the golden zone, the group with next highest pick densities to the silver zoneand those with the lowest densities to the bronze zone.

To illustrate the optimisation of golden zone space, consider a simple example of a golden zone of just 10cubic meters of space. Now consider three items A, B and C, with the attributes shown in the table below................................Item ....................Popularity P ................Volume-Movement V (T C) ..........Pick Density D (P / V)

................................A .....................200 per month ......................10 m3 per month .................................20 requests/m3

................................B .....................150 per month .......................6 m3 per month ..................................25 request/m3

................................C ......................120 per month .......................4 m3 per month .................................30 requests/m3

Suppose now that we decide to store one months supply of material in the golden zone. If we were to allocateItem A to the zone on the basis of highest popularity, this will exhaust the capacity of the zone and thenumber of visits we will get to it will be 200. If , however, we use the basis of pick density, the items assignedto the golden zone will be C and then B. Together, these will exhaust the zone's capacity of 10 m3 (ie 6 + 4 =10) and the number of visits we will get will be 270 (150 + 120). The use of pick density instead of popularityin allocating items will make a significant difference to the stores' utilisation of prime space.


1.6 Material Flow Planning (Layout)

The dominant scheme for the layout of the facility is as a U-shaped flow. The advantages of a U-flow are asfollows:

* There is very good utilisation of dock resources (doors, dock levellers, space, goodsin/out staff), since receiving and despatch operations can share docks;

* U-flow makes cross docking easier, and also facilitates the immediate onwardmovement of incoming Just-in-Time supplies to the factory floor;

* U-flow gives excellent FLT utilisation, since putaway and picking trips can becombined;




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* There is good security;

* U-flow design is inherently more flexible - it is easier to expand the various facilityareas as operations change.

Other layout schemes are "Straight Through" (for distribution depots) and "Modular Spine".

Return to Agenda

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Go to Top of CourseGo to endNext Section

THE USE OF SIMULATION IN MATERIALS FLOW PLANNING

Simulation is an immensely powerful tool in warehouse design and warehouse development for providinganswers to such questions as "how many FLTs should be deployed?", "How many cranes?", "What would bethe effect of a conveyor system covering these locations?" Simulation is particularly useful in warehousingsince it incorporates the mathematics of queuing theory in order to test the effect of likely activity. Forexample, "How long will vehicles wait to unload by mid-morning, and how many extra docks should beprovided to reduce these queuing times by 75% ?" Virtually every company planning and building a newwarehouse will have used simulation in order to do so. Recent past users of simulation have included Boots, inbuilding a complete distribution/logistics system, and Littlewoods Home Shopping, for a 40m distributioncentre eventually incorporating 18 cranes and 350, 000 locations. The main benefits reported were:

The ability to test and compare the performance of alternative scenarios put forwardat the 'ideas stage' of the projects;

An ability to monitor/assess the effects of changing requirements by What-If?;

Accurate comparison of alternatives, with all supporting data ;

Problem solving through the ability to test alternative solutions.

The use of simulation requires the building of a computer model of the proposed facility or proposed change -vehicles, traffic, routes, times, loads etc.. Nowadays, easy-to-use systems which incorporate interactiveanimation can easily to built by anyone. The completed models incorporate animation and realism, with theadvantages that people at all levels are quickly able to grasp what is being proposed, and (throughinteraction) are able to input their own ideas or get detailed information about what is being shown on the

VDU. For example, by clicking on a fork lift truck in the picture, statistics can be obtained about itspercentage use, distance travelled etc, in operating the warehouse over, say, a specified hour. The trainingneeded to use an animated simulation package sufficiently well to obtain good results is just a few days. Inreality, users must spend most of the time fact finding, discussing alternatives with colleagues and decidingobjectives. (As a hint, if the student of this course engages the service of a simulation consultancy, perhapspaying fees in accordance with the time spent, it is essential to find out beforehand precisely what data needsto be provided, and to have such data readily to hand.) The foremost interactive animated simulation packagein the UK principally aimed at warehousing is Automod, and its sister module Autostat, from BrooksSoftware, Reading. Visit http://www.automod.com or phone 0118-921-5600.


1.7 The Installation of Automation

Automation is costly and the more flexible and extensive in design it needs to be, the more costly it gets.Consequently, there are four important requirements to consider before embarking on it, as follows. Theremust be .....

1. sustained, high levels of steady production throughput;

2. a low, stable product range;

3. a high labour content;

4. large individual customer offtake quantities.




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Automated equipment consists of electromechanical devices, communication systems and computers.Electromechanical devices and communications systems include powered rollers, vehicles guided by wirecontacts along floor mounted tracks, automated stacker cranes and other apparatus with feedback andsensing devices. For example, a common scheme is to install vertical pallet racks of conventional design, butwith a power / computer operated fork lift truck on a track in the gangways, the truck capable of reaching allpallet heights. The automation then consists of the truck moving along the tracks and moving the forks upand down, in and out, under the control of a computer program. Many early attempts to automate, however,were failures. There were three reasons:

A. Technical Overambition.

It was not unknown for the design of early systems to take two or three years tocomplete. The designers of the automated system moreover then required that everymovement should be as perfectly meshed in the real world as on paper. Mechanicaldevices, however, break down. The scale of early warehouse projects was greater thanexperience showed to be practical.

B. Logical Overambition.

In order to automate the warehouse fully, it is necessary for software designers andprogrammers to understand and describe its operations fully. Computer programsmust be written and database data properly set up. But many of the activities in themanual warehouse are simply too involved to describe, and must of necessity rely onhuman knowhow and intuition, which cannot be programmed.

C. Commitment and Discipline.

Early automation attempts were looked on as technical and engineering projects.Success however requires full, multi disciplined team commitment and massiveadvance training and publicity. These requirements were not recognised.

To achieve success and avoid the mistakes of the past, five guidelines are put forward.

1. Islands of Automation.

The monolithic automated warehouse is a myth. Instead, automation must be seen as a

set of projects physically isolated from each other. Each project can be put in aloneand should generally be capable of justification in its own right. Examples of islands ofautomation are the automatic storage and retrieval of full pallets; and the installationof automated guided vehicles using wire-to-the-floor, as described above.

2. Flexible Operational Interfaces.

It must be possible for the storeman or warehouseman to take control of operations atsuitable interfaces. For example, if there is a breakdown or incident in the marshallingof (automated) retrieved pallets, it must either be possible to divert the retievals to atemporary, manually controlled area or to take over the system.

3. Supplier / Customer Liaison.

The obligations of the automated equipment supplier are not confined merely to the

customer'sexperience with the technology. He must liaise closely with the customeras part of a team in setting up training schemes and seeing to other matters (eg indeveloping manuals). By the same token, the customer must realise that he also has anobligation to cooperate fully with the supplier.

4. Dedication and Organisation.

The heart of success in automation is not technology. It is the dedication of thecompany and its managers to achieving success, including taking into account thefears and aspirations of all personnel. Success comes from organisation, competence




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and hard work. (These lessons have long been known in the field of big projectdevelopment).

5. Partial Automation.

The stores or warehouse supervisor should contemplate partial automation only ... theinstallation, say, of AGVs, carousels, automatic weighing machines, labelling etc, eachinstalled only as and when its use seems to be individually justified on a strictly localbasis.


1.8 Coding and the Stores' 'Vocabulary'

For identification, classification and computer purposes, each unique item in the stores must be assigned aunique code. Together, the codes and each code's associated information, such as the item's name and othermajor features, are known as the stores' vocabulary. One obvious property of a coding system is that the codesgenerated through it should be consistent. In fact, codes are often made up using a "hierarchical approach",based on the particular types of goods in store. An example is the assignment of a 6 figure numeric code (ieNNNNNN), where the 1st digit is the type of material (ie raw material, component, piece part ...), the 2nd is'metal' or 'non-metal', the 3rd is type of metal, the 4th the form ('rod', 'tube', 'ingot' ...), the 5th the shape and

the 6th the size. (A well-established methodology is theBrisch system, which is a means by which a companycan put together a coding set itself, geared to its own use.)

For the stores, there are two vital coding issues:memorability andmeaning.

Memorability means that the code can be copied down or transcribed onto transactions easily and withconsistent correctness. (Incorrect recording is a major cause of error in stock records.) It has been shown thatto achieve memorability the maximum length of a code should be 7 digits (and 6 would be better - but verydefinitely not 8 or longer, unless a barcode or RFID reading system is in place).

The question of incorporatingmeaning into the code is more difficult. First, it should be said that there is veryobvious merit in keeping to the same coding as used by production and purchasing. However, the generalcompany scheme may not be best for the stores since it is desirable in this environment for the storeman to beable to tell from the code that the material he is about to pick or place has certain properties. For example,

suppose that a material which was subject to special quality procedures (QP) had to be handled within thestores in a certain way. The fact that the material is a "QP" can be stored on the database so that specialinstructions are displayed as necessary by the computer system. But to be safe, it may be desirable to includethis on the code itself, so that storemen can recognise it on occasions not involving the computer. A secondexample relates to packaging. It may be logically correct to designate the 50kg Box Packet as 01, the 50kg SoftPacket as 02, the 100kg Box Packet as 03 and 100kg Soft as 04. But it may be safer to code them B50, S50,B100 and S100 to prevent errors during the physical act of picking. All the attributes of a material qualifiedby its package can be maintained on the database internally, available to the storesmen through computerprograms. But it may be necessary to incorporate a number of these classifications in the visible code itself tohelp staff in the operational side of their jobs. If so, the risk then arises, of course, of making the code moreunwieldy from the viewpoint of memorability!


1.9 Installing Technology1.9.1 Batch v. On-Line

Batch.

'Batch' processing means that data events are progressively recorded through somemedium (whether paper forms or an electronic recording collector) and the recordsthen input to the computer all together. That is, the original data are deliberately heldback from being input to the computer until a reasonable quantity of information hasbeen collected, so that input, although efficient, is made usually several hours after the




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events being recorded. If a transaction is found to be in error when finally submittedto the computer, there can be a delay of many days before its investigation and finalcorrection.

On-line.

In on-line processing, data relating to an event is notified to the computer on anindividual basis as soon after the event as possible. (There is usually nevertheless abrief time delay between the event and the transmission of the record. The delay maybe minutes or, in a slacker environment, one or two hours.) There are two advantagesto on-line processing. First, the central computer database is brought up to date farsooner, and usually accurately reflects the current situation. Secondly, there isimmediate feedback after submitting the transaction and, if it is in error, theopportunity exists for immediate error correction by the person responsible forcompleting it in the first place.


1.9.2 Data Recording Equipment

Data recorders:

These are hand-held machines similar to electronic personal organisers.When its capacity has been reached, or after an appropriate period oftime, the device is taken to a terminal and the data that has been capturedis transmitted, or 'down loaded', to the computer.

Radio data terminals (RDTs):

These are hand-held devices which incorporate a small VDU screen, plus atiny keyboard (say, 3"). More importantly, they are able to communicatedirectly, on-line, with the computer via a radio signal - ie a cable is notrequired. Data recorders and RDTs can optionally have bar code scannersattached and some models are suitable for rugged or hostile environments.

Return to AgendaReturn to top of AgendaGo to Top of CourseGo to endNext Section1.9.3 Voice Directed Picking

Voice directed picking is a highly effective and increasingly popular technology thathas many advantages in both stores and warehouse operations. With 'voice', workerswear a headset, earphones and a belt-attached portable computer which enable themto hear instructions from the computer and to speak words of confirmation as toaction taken - below under Order Picking.


1.9.4 CommunicationsElectronic Data Interchange (EDI): This medium is perhaps being eclipsed by theInternet. The term EDI refers simply to the creation of data by one computer, incomputer readable form, and its acceptance directly by a second computer. Usually,the transfer of data is through a data network known as a Value Added Network(VAN). The sending company transmits the data with the code of the intendedrecipient company. The data is stored on the VAN operator's computer at the nearestposition to the receiver. The receiving company scans the VAN computer at timesconvenient to itself for any messages addressed to it. Local networks mean in-housenetworks communicating via coaxial cable laid in the premises. Wideband networksare inter-site, and are capable of carrying vastly greater volumes of data traffic. They




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are typically provided by BT between specified major towns and cities. The Internet isa communication medium based simply on ordinary, existing telephone cabling, andhas the consequent virtue of being cheap. Direct access between a distribution depotand a central warehouse is via a local telephone call using simple software. Both textand graphics can transmitted and received.


1.9.5 Weighing and Measuring DevicesComputerised weighing machines. Asample scale can be used to find the 'mean', oraverage, unit weight of a product, and the average then stored on a computer. Largeelectronic scales are subsequently employed to weigh the main stock entering thestores or warehouse, with direct links to the computer database holding the unitweight. Care must be taken to account correctly for the container weight, referred toas the "tare", and to ensure the items' weight is not distorted by oil, wetness etc. Otherdevices of value are simple weighbridges, non-computer weighing scales, calipers andmicrometers. In the process industries, bulk liquids are measured by flowmeters oreven simple dip tapes and dip sticks. Many methods used for measuring liquids areacknowledged as being problematical, with comparatively wide tolerances arisinginherent in the techniques themselves. Problems may be compounded by the need totake the temperature of the liquid, and the further need to assume the temperature isuniform throughout the material's bulk.

Weigh Counting. This method of counting items which aredispensed from a stores or warehouse is used when items aresmall or light. It is normally done on purpose-made weigh

counting scales. (The first thing to note is that a scale should beselected that has a sensitivity appropriate to the weight of theitems being counted - ie if the items are light, the scale shouldbe more sensitive). The procedure follows three steps: (1) First,the "tare", or base weight, of the container in which the partsare held should be determined most carefully by separateweighing - say, weight T, which is entered into the memory ofthe weighing scale; (2) Next, a sample of the items to becounted should be taken and counted out most carefully, andthe total weight, including the container, determined. Saythere were 12 items in the sample, and the total weight waswas W. This data is again entered into the memory of thescale, which is then able to calculate the unit weight of oneitem. In our example, this is (W - T)/12, or X. Finally, (3) weweigh all the items which are to be counted. Say, the weight isB, including the container. The number counted is givendirectly by the counting scale, and here is (B - T)/X. Note thatideally in order to be sure of the accuracy of the unit weight, 4or 5 weighings should be taken and averaged. This is becausethe differences in weight between the units being weighed israndom and the statistical distribution of these differences isNormal. The most important factor is to obtain an accuratereading of the tare weight of the container. Substantial errors

can arise if the same unit weight X is applied in weighingsinvolvingapparently identical, but different, containers, eachcontainer therefore having a different tare weight. Note that avariation of this method of weigh counting is reverse sampling.


1.9.6 Bar Coding and RFID Tags

Bar Codes




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The familiar bar code is the representation of a numeric, alphabetic or alphanumericcode by a pattern of dark and light stripes, with 'start' and 'stop' characters at eitherend, and which can be interpreted, or read, by a light scanning device called abar

code reader. Bar code readers are eithercontact ornon-contact. Contact readers suchas those used in retail shops are also called fixed beam readers, since the device needsto be very close to the bar code. They are comparatively inexpensive (100 +). Non-contact scanners, or line scan readers, work by repeatedly reading the code with alaser beam fired by a gun, perhaps mounted on a truck, until the reading is error free.They cost about 1000. There are a dozen or so different bar coding systems forassigning a code to a material. One used extensively in the warehousing of consumergoods, including the outside carton packaging of groceries, is termed Interleaved 2 of5. It is numeric only, and requires the code to comprise an even number of digits.With Interleaved 2 of 5, even numbers are represented by the white stripes and oddnumbers by the dark bars. Its advantage is its physical density. In industry generally,however, there is a preference for the Code 39 system. This is capable of encodingnumbers and letters. Each character is represented by a group of 5 bars and 4 spaces,and has an in-built check to eliminate mistakes in the physical reading andinterpretation of the code by the bar code reader. Other bar code systems are EAN(European Numbering System) and UPC (Universal Product System). UPC wasdevised by IBM in 1973 and is the one used in groceries in supermarkets. Itsadvantage is that the code does not need to be on a flat surface to be read by thereader.

Bar coding in the stores or warehouse is not always successful even when thoseattempting its implementation have carefully assessed that it will be. There are threeissues.

First, there is the matter ofergonomics. Ergonomics is thescience of man-machine interaction, and here means howcodes are to be assigned, how (literally) they are to be attachedto the objects and locations in question, how the codes are tobe read, and what equipment is to be used. It also encompassesthe nature of the computer system that will read the codes andhow associated data, such as quantities, are to be recorded.

The second issue relates to the physical nature of the itemsactually to be bar coded and seems to be the most critical of

the three. If there is a wide variety of shapes and sizes, andmany items are irregular or have a unsuitable surfaces, it willbe difficult to devise satisfactory, consistent ergonomicallysound procedures.

Thirdly, if it is intended that incoming raw materials are to bebar coded by suppliers, their competence and willingness to doso must be considered (or, at least, their willingness to applybar code labels and documents supplied by the company).

If bar coding works well and easily, without a continual struggle to keep it going, thereare two advantages to its use. First, self-evidently, material and location codes areread correctly and more easily. Secondly, the reading process ensures that eachtransaction relating to an activity is indeed raised, and is not forgotten, and that it is

then input to the computer system in a timely manner. (Missing transactions are amajor source of error in attempting to achieve high stock records accuracy.)


RFID Tags (Radio Frequency Identification Tags)

By 'identification' is meant the attachment of a small "tag" bearing the code andmuch other data of what is to be identified, and the subsequent reading of the tag codeand data at some later stage by atag reader. The physical tag attached to the object




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may commonly be a label, in a flat, thin, flexible ticket or may take other formsdepending on the application to hand. Important attributes of tags are that they arerobust and capable of functioning in extremely harsh environments and that they arereusable and can last for many years. The code and other data associated with the tagis read by a special tag interrogator, a primary function of the interrogator, or reader,being to excite a component within the tag termed itsantenna. Although thetechnology associated with RFID tags and interrogators is changing rapidly, as at thedate of this on-line course (2006), the microchip incorporated in the tag 'structure' islikely to be a silicon microprocessor and the antenna formed from conductive carbonink. The silicon chip will be attached to carbon - ink electrodes at the back of thepaper label. (Labels are referred to assmart labels.) Note particularly in RFID tagsthat a battery may be incorporated into the tag - that is, a tag may have a smalllithium battery to boost power. Tags with batteries are referred to asactive tags andwithout aspassive tags.Power is transmitted to the tag in the first place from an electric

field created by the tag interrogator. Data is transferred from the tag to theinterrogator through the modulation by the tag of the interrogator signal. With theirextra power, active tags are able to communicate with an interrogator overconsiderably greater distances than passive tags (many thousands of feet rather thanonly tens of feet). Active tags are also capable of carrying and conveying greateramounts of data (thousands of bits rather than tens). Not surprisingly, however, activetags are more expensive. Cost is currently a major issue in RFID technology,especially as it concerns its widespread adoption in retail.

A critical milestone in the practicality and acceptability of RFID technology has beenthe adoption in late 2005 of the GEN2 data technology standardand theALE standard.GEN2 governs the basic tag reading technology essential to the production of tagsthemselves and tag readers. ALE deals with the collection, management and routingof data; it addresses the problem of huge amounts of raw data generated by RFIDreaders - readers can make multiple readings of the same tag in a fraction of second,so that this "dirty data" must be filtered. In summary the key benefits of GEN2 andALE are the ability to read RFID tags quickly and simultaneously.

Finally, and most importantly, we see from the technical nature of the interactionbetween the RFID interrogator and the RFID tag, that two major advantages lie with thetechnology and distinguish it from bar coding.

First, that in order to read a tag, it is unnecessary to have a

direct view of it. Communication is by electrical waves andantennas, and line of sight is no more required than it isrequired of a radio in order to broadcast to it a programmefrom a transmitter.

Secondly, it is possible easily to read tags which have beenattached to a succession of irregularly shaped items whichwould be unsuitable to bar code reading. Examples ineveryday life typical of the application of RFID tags are: cartagging for toll booths; hospital patients; criminals on licence;airline luggage; library books; the tagging of wild anddomestic animals; and marathon runners.

For the stores or warehouse, however, one critical application of

tags is in making use of the ability to read simultaneously theidentities of all the tagged components of an incoming* oroutgoing load merely by scanning it from a distance with the taginterrogator . * Provided the supplier has tagged all materials, ofcourse.

A second is the ability quickly and easily to verify and countstored stock, as in cycle counting or in the conduct of an annualstock take.

Yet a third example, recently announced by Intermec and




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Cascade Products, is to mount RFID readers in the tines of fork

lift trucks and verify the correctness of warehouse floor picks viaa computer display in the truck cab.

As well, RFID tags have been attached to stillages to help trackand control the (remarkable!) losses of these devices. A finalexample of use relates to a national company distributing winesand spirits, which wished to double check assembled loads for

correctness on its vehicles before despatching them tocustomers, and to a major retailer receiving loads of garments

hanging on rails at its major stores from its distributionwarehouse. Besides these, there are an ever increasing number

of other applications involving the simultaneous, mass reading ofpalletised loads at the point of despatch and the verification of

loads at their destinations.

In order to commence a move to RFID, the stores supervisor might first attend a one-day course on the subject held at the DTI's RFID Research Centre in Bracknell,Berks.. Further details are obtainable at the Research Centre's website athttp://www.rfidc.com. In addition, it is possible to see RFID in action at an RFIDdemonstration site run by Unipart Logistics and others at Oxford. Two consultancies

expert in RFID are Manhattan Associates and Davies & Robson.Return to AgendaReturn to top of AgendaGo to Top of CourseGo to endNext Section

1.10 Special Situations

1.10.1 Stockyards

Construction

The stockyard must be sited with immediate access to adequate roads capable oftaking heavy lorries. If it is to be accessed by rail, railway lines should be sunk toground level. And if so, if possible, a single line to a deadend in the yard should be

avoided because of subsequent queuing problems. Beyond this, stockyards are cheapto construct, amounting merely to expenditure on barbed wire or other fencing, plusthe required surfacing. Surfacing will depend on the loads to be stored. In order ofrising cost, they are: Gravel or Ashes - this will not support heavy loads and heavytraffic in bad weather; Tarmac - popular, though liable to damage and 3 times moreexpensive than gravel; and Concrete - 5 times more expensive than gravel, but suitablefor all loads in all weathers. The most important additional feature is adequatedrainage to disperse rain water - even long life building materials are damaged byconstant contact with standing water.

Repairs and Maintenance

The need for a proper programme of repair and maintenance of a stockyard is amatter of greater concern than points about the original construction. Stockyard

maintenance, especially in Winter, is a constant activity. Areas to watch out forinclude: fencing (to ensure that it is fully maintained); waterlogging (drains must becleared so that standing water is dispersed ... and Autumn leaves cleared up!); surfaceholes (holes must be repaired); and lighting (ensuring floodlighting is periodicallychecked).

Layout and Organisation

The gatehouse is the nerve centre for all documentation including the overall companystock records system. A very minimum requirement is connection to the central officeby phone and fax. Better, even for small stockyards, is a proper telecommunicationlink, perhaps involving RDTs. Points to watch in respect of organisation are:




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(a) the establishment of a proper location system, with ground areas coded by alleyways and local areas, perhaps being marked out by posts;

(b) If dangerous or flammable material is stored, the provision of emergencyequipment and the establishment of full procedures;

(c) measures to prevent trespassers, especially children, from entering the area - thecompany is liable if children manage to gain access and subsequently come to harm;

(d) stockyards are very frequently seen as a nuisance to residential neighbours -traffic, noise, lighting etc, so that if possible they should be sited well away fromhouses or land where house planning permission may be granted;

(e) setting up an efficient one-way system for traffic, with good signposting;

(f) ensuring that there is supervision during all opening hours, including meal breaks;

(g) neatness and tidyness must prevail to minimise the risk of accidents;

(h) the stock must be cycle counted on a regular basis. Note that it is not unknown inpoorly managed stockyards for corners of stock to become isolated and forgotten.

(i) Remember the effect of weather on signs and, especially, labels. Even plastic labelscan become unreadable after a time, and routine label replacement may be necessary.


1.10.2 Cold Stores

The cost of building a cold stores is about 3 times that of an ambient store. A secondconsiderable cost is the cost of running the store (and the colder, the more costly): thismust be balanced by the cost that would otherwise be suffered from the deteriorationof the product. As well, temperature controlled vehicles are expensive. Thetemperatures needed for the degree of cold clearly depends on what is to be stored.Thus:

......Frozen Stores ................-30C to - 10C .............................meat, fish

......Chilled Stores ................- 5 C to 0C ..................................fresh meat, fish, poultry

......Cool Stores ................... -1C to + 5C ..................................dairy produce

......Cold Stores ................... +5 C to +15C below ambient .... citrus produceThe critical factor in the operation of a cold store is the activity taking place at thedoor. If warm air is allowed to enter the building, ice will form and will be costly toremove. Solutions to the problem are the installation of a conveyor tunnels; air locks;and fast acting insulated doors. (A well-known vendor of high speed, insulated doorsis Hormann, in Leicester; Hormann have developed theDOBO docking system,whereby docking takes place before opening.) A related problem in cold stores iscondensation. Excessive condensation can form on the product and damage it. Toavoid this, loads are best removed in small quantities, with immediate protection usingmoisture-proof covers. Note that it is common practice that storemen in cold storestake a 15 minute break per hour. The most careful watch must be kept on racking,fixtures and fork lift trucks continually exposed to the cold. Steel can become brittleand dangerous. (FLTs bought new and destined to work in cold stores are in factmodified by manufacturers). Repairs to racking are also a problem - oxyacetylenewelding is not undertaken, since welds become eutectic and break. Instead, boltedracking is used. Repairs to a floor also present difficulties, since there is usually a needto raise its temperature to effect them. Care must also be taken in product stacking - itis essential that air should be allowed to circulate the product stored.




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1.10.3 Tools Stores

In general, tool control is best accomplished in conjunction with the planning ofmaterials and jobs, in the normal management of the shop floor. The ability toassociate particular tools with particular jobs by augmenting the database with the

relevant data is not especially difficult. What makes tools different, however, is (1)that tools are reusable, and (2) that tools have a limited working life, after which theymust be replaced or repaired.

Storage and Retrieval

Although many factories maintain separate tool stores, thereare considerable advantages in incorporating actual physicaltool storage within the standard materials store. The chief ofthese is that the strict procedures which govern the stores itselfare then applied also to the management of tools. That is, (a)access is restricted to storemen only; (b) there is meticulousbooking in & out of material; (c) there is, or should be,availability of service at all times that production takes place.

The Issue of Tools

The requirement for tools to be issued to the shop floor can becoordinated from the job release planning data. From this, toolpicking data is prepared each evening and the tools distributedto the work centres each morning. There will also be directrequests of more or less urgency from shopfloor personneleach day. And finally, there may also be 'reverse issues' -system-generated tool recalls based on tool life calculations onthe database.

Planning Requirements for Tools

(a). Consumable Tools: These tools are generally worn awayover a matter of a few hours in operation, and are thendiscarded and replaced by new ones. They include (say) smallgrinding wheels, drills etc.. Assuming the annual usage of themis sufficiently high, a satisfactory method of planning theirstock and replenishment is to employ the conventional 2-binsystem; (b). Medium Life Tools: Many tools such as millingcutters can be used a number of times - say, for so-many dozenhours - after which time and after due inspection they must bediscarded or repaired. A consequence of this in planningfuture replenishment schedules is the difficulty of accountingfor the stock of tools on hand; (c) Long Life Tools: Tools witha comparatively long life such as milling fixtures and drillingor assembly jigs are often associated with a specific

component. If so, the requirement for the tool can bemonitored by associating it with that component's bill ofmaterials. Three well-spoken of software packages in this areaare Tyco, Autotask (from Sandvik) and Super Capes.

Tool History Database

Where tools are individually specified, with a tool-type id andan individual serial number, a tool history should bemaintained by recording from other shop floor supportsystems the actual hours each tool is in use, along with basicbackup data such as expected life, acquisition leadtime,




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operations / components used with etc... Software packages inthis area include the three packages above (ie Tyco, Autotaskand Super Capes).


2. Materials & Materials Handling

2.1 Knowledge and Protection of Materials (including FIFO)

Having a knowledge of the materials that are handled and stored are core requirements of the storeman orwarehouseman. "Knowledge" means knowledge of the materials' sources and suppliers; any specialcircumstances in their manufacture; their technical characteristics; methods of measurement; how theirquality is assessed; and the uses to which the materials are put.

The simplest and most reliable scheme that the stores supervisor can adopt for protecting the material in thestore's care is surely adoption of a policy ofFIFO (First in - First out). FIFO ensures that the oldest stock isused first so that it has less chance of deterioration due to the passage of time. Identification of the oldestmaterial, however, may not always be easy when the storeman comes to make a withdrawal, especially in afixed location store. Three methods for doing so are:

(a) Since the stock recording system tracks the dates stock was put away, pickinginstructions might be issued taking account of the age of stock to be removed;

(b) When stock is originally stored, its putaway date or batch sequence number shouldbe clearly marked;

(c) If material is particularly sensitive to deterioration due to time, the medium chosenfor its storage should be geared to enable FIFO to be accomplished readily. Forexample, stored objects may be placed at one end of a long bin, and removed by accessto the far end of the bin, the material in the bin being pulled along on rollers (ie livestorage). For any storage medium, staff must be trained to put material awaysupermarket style - ie the newest to the back.

For legal, traceability and safety reasons, some types of material must be separated by technical/production

batch. Familiar examples are foodstuffs, pharmaceuticals and parts used in aircraft manufacture. (There mayalso be a requirement for traceability under ISO 9000.) Since the batch identification data includes thestorage date, FIFO picking instructions are generally straightforward in such instances.

The stores supervisor is not the only manager who can contribute to reducing the threat of time's passage tothe condition of stock. In todays manufacturing environment, "lean production" techniques which greatlyreduce stock holding can make an even greater contribution than FIFO. For example, purchasing departmentmust recognise that excessive purchasing lot sizes are expensive and that the cost of stock holding is over 25%per annum of the value of material held. And the production manager can get smarter in the scheduling ofwork, and can vastly reduce production lot sizes by the adoption of fast machine changeover techniques(which make it more economic to manufacture small lots).

Time is not the only enemy of stock. Others are damp, dust, physical damage and sunlight, usually in thatorder, and action to avoid these perils must be taken accordingly. For example, protective coatings of grease

or oil might be applied, or the items might be stored in damp-proof and rigid containers, perhaps in smallquantities for easier, damage-free issue. Potatoes and other items may be stored in humidified warehouses*.Other examples of protection are the storing of electronic components to ensure that they are not harmed bymagnetic fields or X-rays, the protection of certain agricultural goods by dusting them with insecticide andanti-fungus powder, and the stacking of timber in an interleaved fashion to permit the circulation of air.Finally, the safe storage of some goods predominates the whole stores operation. Two examples are thestorage of explosives, requiring a police certificate, and the storage of petroleum, requiring a local authoritycertificate. (* One result of storing potatoes in humidified warehouses is to increase their weight, and alsoincrease their value if eventual payment is calculated by weight.)





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2.2 Pallets and Unit Loads

2.2.1 The Pallet

There are some 50m pallets in use in the UK, the majority made of wood from thePortugese Maritime Pine, a wood harvested nowadays literally as a crop. The pallet isdesigned for use with the fork lift truck. The load carrying capacity of the pallet isdetermined by its design, construction and weight. The more wood, the stronger the

pallet. When pallets are first bought, a maximum load bearing capacity and theoperating environment in which it is to be used are specified; it is dangerous andillegal to exceed the specifications.

Plastic pallets are also used, as well as wooden pallets. An advantage of plastic palletsis that they are capable of easy, thorough cleaning and disinfection. (For that reason,their use may be insisted on by food manufacturers). Before choosing plastic pallets,an assessment should be made of the damage likely to be incurred to them due tostress in loading and unloading operations. For example, pallets made of hollowplastic may rupture, leading to the ingress of water and dirt. Consideration shouldalso be given the effect on plastic of conditions of storage: temperatures below -20Cmay lead to cracking and fractures, with the implications this has for safety.

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2.2.2 The Unit Load

The most critical and distinctive feature of a pallet is its "footprint" - ie its width xbreadth. In UK industry, the standard pallet load platform is 1000mm 1200mm. Asa consequence, what is createdde facto is the standardisation of the loads carried.Such standard loads are referred to as unit loads - ie individual loaded pallets, builtup, perhaps, from separate packages in the form of a rectangular block, handled as asingle lot and capable of being stacked onto other similarly palletised unit loads. Amajor consequence is that the provision for their handling from one company to thenext by standard equipment is easily accommodated. Complete standardisation of unitloads in terms of their dimensions and maximum weights is referred to as unitisation.(Unitisation exists in the grocery supply chain all the way from grocery

manufacturers' factories to the retailers' local depots.) A further form of unit load andunitisation is one based on a standard ISO container, this being 8' wide and 8' high,and one of four standard lengths (10', 20', 30' and 40'). Container handling alsoentails standard equipment - end loaders, side loaders, straddle carriers, gantrycranes etc..


2.2.3 Pallet Loss

By far the biggest issue relating to wooden pallets is that of their loss. Because they areso widely used, many staff see them as common property. Indeed, certainorganisations operatepallet "pools" through which they are interchangeably swapped.

But common property has a knack of sticking to some firms and disappearing fromothers. It is not uncommon for a very large company to appoint a full time "palletofficer" - usually a young manager of the investigative type. Hints and tips to reducepallet loss are:

(1) to take the problem seriously - measure and report pallet expenditureand loss, and keep up the pressure;

(2) to mark all palletsProperty of the ABC Company if they are not to beswapped via a pallet pool. This is the only sound identification legally;

(3) to make staff responsible for pallets that they remove from the




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premises - drivers carrying palletised loads, for example, must know theyare expected to account for their returns.


2.2.4 Pallet Stacking

While much attention in the past has been paid to individual package design, oftenlittle has been spared for the way those packages are stacked on pallets or how theycan be packed better in standard outer cases. One software package that addresses theproblem is CAPE PACK. This consists of a number of modules for showing howpallets are to be stacked (the 'Palletise' module), how boxes and containers are to befilled (theBoxfillmodule), how boxes might be redefined for better stacking andfilling (thePackfillmodule) and how new packaging requirements should be designed(the Cellsize module). There are other features as well, including 'Display Pallet',giving a 3D inside' view of the proposed stacking of boxes etc.. CAPE PACK is soldby Cape Systems Ltd. (phone 020-8752-8610).


2.3 Packaging2.3.1 The Package

The development of a company's packaging is a well- established, dedicated functionin larger warehouses, often entailing the appointment of a packaging manager. Hisrole is to ensure that the company's packages meet the standards specified, and todevelop new packages in order to increase the competitive edge and reduce costs.Complaints about split packages or damaged goods must be evaluated carefully toestablish the precise reason. The job clearly involves liaison with packagemanufacturers to identify possible applications of new package types. Proposedchanges to packages must be evaluated carefully by the entire material handing chainas discussed below - by manufacturing (to test handling and filling), by distribution(for transport and handling) and by the customer (for handling and being of pleasing

appearance). Note that all wood used in packaging which is then exported must,according to theISPM15 regulations, be fumigated, heat treated and marked to avoidthe spread of woodland pests.

The principal functions of packaging are given below. In considering them, it shouldbe noted very obviously that storage facilities and methods of transport also helpdetermine packaging specifications, as well as the protection itself of the goods to becarried. In considering the functions, the packaging technologist must assess thetrade-off between factors - for example, the best protection against damage mayinvolve too great a bulk and too high an increase in haulage weight. Thus: (1).Protection of the Goods (Environment): this may be especially exacting when materialis being sent to "deep sea" markets - into cold Canadian winters or to Thailand in themonsoon season. (2). Protection of the Goods (Transport): Fragile goods may requirespecific purpose packages with internal package clamps, protective frames, cross

pieces and polyester foam cut-outs in the shape of the product. (3) Handling: thisincludes palletisation so that packages can be stacked in a single (ie unit) load. (4).Recognition: it should be possible for customers to recognise goods quickly andwithout error, especially as companies move to more frequent deliveries of smallerquantities. (So-called "shop ready" packaging is also becoming increasinglydemanded by retail customers.) Counting multiple items within a package is alsoimportant from the viewpoint of stock records accuracy. Finally, there is the questionof advertising and appearance. Students of this on-line course with a special interest inpackaging may care to join The Institute of Packaging, phone 01476-514590. The IOPhave a diploma in packaging technology, and corresponding training schemes.




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2.3.2 Packaging Waste

The packaging waste regulations became law in 1997 and were forced on the UK bythe hated European Union. They were intended to reduce the effect of packagingwaste on the environment. The targets set are as follows:recovery (including energy

recovery and compost), 50% - 65%; andrecycling: 25% - 45% (at least 15% byweight of each individual package material to be recycled. Five terms should first bedefined, as follows.

Primary packaging - the package that constitutes the sales unitsold to the ultimate customer.

Secondary, or grouped, packaging - the package used tocontain the primary packages

Tertiary packaging - the package containing the secondarypackages.

Recovery or reprocessing - (including recycling and

incineration with energy recovery

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