1. Warehousing Storage (Location) Balancing act

2. Warehousing An act of storing and assorting the finished goods so as to create maximum time utility at minimum cost Sub function – Storage, movement, assorting, hold, consolidation, break bulk, packing,

3. Advantage of Warehousing Serves as safeguard Make provision for unloading Serves economically at lower prices Helps in determining the channel of distribution Assist in maintaining continuous sales Balancing demand & supply Stabilizing prices Reduces need for instant transportation

4. 4 Warehouse Operations Receive and Inspect Goods Identify Goods Sort and Dispatch Goods to Storage Hold Goods Recall, Select, or Pick Goods Organize the Shipment Dispatch the Shipment Prepare Inventory Records Warehouse

5. Types of warehouses A. On the basis of place of necessity Inplant warehousing Field warehousing Bonded warehouses – located near ports A. On the basis of ownership Private Public Contract

6. Types of warehouses Special warehouses General merchandise warehouses Special commodity warehouses – require special treatment Refrigerated Yard & ground storage

7. Types of warehouses On the basis of operation Centralised Decentralised

8. Warehouse site selection factor Infrastructure Market Access Primary transportation cost Availability Product Regulation Local charges

9. Transportation The movement of products from where they are made to where they are used Involves loading & unloading of productd Confers time & place utility

10. Modes of TransportationRail Air Pipeline Water Motor

11. 11 Modes of Transportation Rail Merits  mass movement of goods  Faster than road transport  Convenient for long distance  low unit cost  Suitable in carrying heavy goods  Operation less affected by adverse condition Demerits  Lesser accessibility  Relatively expensive for short distance  Inflexibility  Not suitable for local transport  Involves heavy losses of life in case of accident

12. Roadways Merits  point-to-point service  flexible  Safety  Cheapness  Perishable goods at faster speed for short distance Demerits  Flexible  Irregularities  Limited carrying capacity  Heavy goods in bulk involves high cost  Slow speed  Affected by adverse weather condition

13. 13 Modes of Transportation (Cont’d) Water Merits  lowest costs, for bulky goods  large capabilities  mass movement of bulk commodities  International trade  Cost of maintaining & constructing routes is low, naturally made  Safe mode with respect to occurrence of accidents Demerits  Low speed  Seasonal  Not suitable for perishable goods  Affected by weather conditions

14. Airways Merits  fastest for long distances  broad service range  Useful in non accessible area  Most convenient during calamities Demerits  High cost  Limited product  Not suitable for heavy & short distance  Heavy losses in case of accidents  Affected by adverse weather condition

15. 15 Modes of Transportation (Cont’d) Pipeline Merits  mass movement of liquids and gasses  Economical  Un-interrupted service  No damage  Underground  lowest operating cost and unit costs Demerits  Initial heavy investment  Danger of enemy attacks Pipeline

16. Combination Of Modes Piggy - back Fishy - back Air - Truck Roll on – Roll off

17. Transportation modes for various products

18. Comparison of various modes

19. Importance of transportation Confers time & place utility on products Where production location & markets are distanced transp n helps Help to build clientele Widening the markets Increase in mobility of labor & capital Stabilization of prices Service to customer & rise in std. of living Facilitates production

20. Main Task In Transportation Assessment of the transportation Choosing the mix of transport modes Deciding the routing Development of operational plan Implementation Control of transportation cost

21. Managerial Aspect of Transportation Deciding mode of transportation Cost Speed Handling damages Regularity Flexibility

22. Factor Affecting Transport Choice Product Packaging Distance Monetary resource availability Urgency Lead time

23. Choice Of Transportation Modes Speed Dependability Availability Costs

24. Inventory Refers to a stock of goods or other economic resources that are held by firms at a particular time for future production requirements & meeting demands Inventory can be direct or indirect – Direct includes goods in manufacturing of product & become part of finished goods. Ex. Raw material, WIP goods, finished goods Indirect include goods that are necessary to run production process not part of end product. Ex. Lubricants, oil, grease, stationary

25. Objectives Of Inventory To improve customer service To reduce investment in inventories To increase productivity To optimize space required for inventory To rationalize material movements To reduce losses due to obsolescence, deterioration