Transcript Document
Order Processing
Packaging & Shipment
Chapter 3
Chapter 4
Traffic Through Warehouse
Step 1 - Product enters a warehouse
(Receiving)
Step 2 – Product is placed in appropriate
warehouse location (Stocking)
Step 3 – Product is prepared to leave
warehouse (Order Processing)
Step 4 – Product is placed in a vehicle for
transport to next destination (Shipping)
Definitions
Order: Requirements & instructions for
picking and shipping a set of inventory items
Stock Keeping Unit (SKU): unique alphanumeric characters identifying an item
Line: Multiple requirements for an SKU
Pick List: Items in an order
Picking: Selecting, counting and dispensing
items in an order
Order Pickers: People selecting, counting and
dispensing items in an order
Value Added: Service that adds value
Order Processing
Customer receives order
Customer screens order
Customer inputs order into WMS
Order Picker retrieves pick list from WMS
Order Picker locates & picks items
Order Picker follows instructions for Added
Value (packaging, labeling, assembly…)
Order Picker delivers prepared items on
Pick List to staging area for shipping
Customer Receives Order
Order Processing begins when Customer
(not warehouse) receives an order
Internal: Warehouse & Customer are same company
External: Warehouse & Customer are different
companies
Customer: Internal or external owner of product in
inventory
Customer/Order Examples
Amazon – Online purchase of product
Internal Customer – Operates own DC’s
Walmart – Automatic electronic store update
of stock
Internal Customer – Operates own DC’s
SPECS – Allocation of inventories
External Customer – Uses 3PL Warehouse
Exxon – Manufacturing material request
Internal – Owns tanker terminal that feeds into refinery
Tanker Terminal serves
Same purpose as warehouse
Amazon Client’s Order
Screening an Order
Customer needs to assess if an order can be
fulfilled
Quantity – Enough in inventory?
Quality – Order requirements met?
Time – Time parameters?
Value-Added – Other services
Since warehouse holds inventory, access to
some of this information can be obtained
through WMS
WMS Inventory List
Order in WMS
Customer inputs order into WMS
Order should/could include
Quantity – Number & types of items
Quality – Customer’s Vendor Compliance
Time – Scheduled delivery/pick up
Other – Assembly, packaging, labeling, testing and other
services…
Amazon uses internet to receive client orders
then software processes order into WMS
Pick List
The WMS transforms customer order into a
Pick List customized for individual
warehouse operations or systems
Picking
There are 3 basic Picking systems
Area System/Single Order Pick
Zone Pick
Multi-order/Batch Pick
Area System/Single Order Pick
Order Picker moves throughout warehouse
picking items for order (like grocery
shopping)
Order Picker takes items in order and takes
them to shipping area
The Gulf Winds warehouse system
Zone Pick
Warehouse items are added to single orders as
they pass through different zones
Items related to each other (SKU, parts to assemble)
Warehouse equipment used (forklift, by hand, robotics)
Specialty storage (reefer)
Value-added services (assembly, packaging labeling)
Order Pickers only work in their own zone
Ford, Chevy, Chrysler assembly plant system
Parts of an automobile are stored in zones and added to
the vehicle as it passes through assembly line
Multi-Order/Batch Pick
Warehouse is divided into zones
Items related to each other (SKU, parts to assemble)
Warehouse equipment used (forklift, by hand, robotics)
Specialty storage (reefer)
Value Added services (assembly, packaging labeling)
Order Pickers only work in their own zone
Definitions
Within each of these systems, picking can
be carried out as:
Pick-To-Order: An Order Picker picks items for one order
(each order handled separately)
Batch Picking: An Order Picker picks all items for a group
of orders (reduce trips to warehouse by picking same
items for group of orders)
Pick-By-Line/Pick-To-Zero: Exact number of items in one
product line are available for picking (same type &
number of items are delivered until line is exhausted)
Processes to Improve Accuracy
Processes with limited technology:
Pick By Label: WMS prints a label for item to be picked
and attached to picked item
Issue Pack Optimization: Items in measured lots (pallets,
cases, batches)
Pick Task Simplification: Eliminating & combining
picking tasks
Order Batching: Grouping orders in a batch to reduce
travel time by Order Picker
Move to Forward Pick Location: Large warehouses batch
orders for a day and moved to staging area
Processes to Improve Accuracy
Processes with technology:
Bar Codes: Item identification in WMS linked to
scannable barcodes (SKU, Model/Serial number)
Batch Picking: Radio data terminals in workstations
communicate with WMS
Pick-To-Light/Put-To-Light: System scans barcodes to
confirm accurate pick or , in a return, put back accurately
Voice Technology: Order Picker receives pick list and
confirms pick via headphones
Staging of Picked Items
After picking, items are brought together,
consolidated and prepared for delivery to
customers
Kitting: Individually separate but related items are
grouped, packaged and supplied together as one unit