Reduced inventory holding at the warehouse has many benefits.
- Reduced financial investment in stock
- Reduced storage requirements
- Reduced labour to manage the stock
- Reduced chance of stock expiring
- Reduced obsolete stock at the end of a season
- Improved time to market
- Improved customer satisfaction
Reducing inventory levels are achieved by streamlining the supply chain.
Streamlining by Triggering Events
Every event in the supply chain between supplier or manufacturer and customer can be automatically or manually triggered for action in SEQOS.
When an order is raised which is to be delivered to the customer on a particular day or between two dates, the ‘Delivery Lead Time’ for that customer determines when the order should be despatched from the warehouse. The delivery lead time calculation automatically adjusts for public holidays and other non working days.
Prior to picking a day’s orders, which have been selected by the system through the ‘Delivery Lead Time’ module, the SEQOS Labour Planning module calculates the required number of staff for that day using historical data for similar orders and products.
The SEQOS Automated Task Queue automatically assigns putaway, replenishment and picking tasks to the next available operator for that task, with a priority calculated using configurable rules. Orders automatically or manually released for picking are added to the Task Queue. When the stock level at a pickface or any other location configured for automatic replenishment is reduced to the minimum holding quantity, a replenishment task for that location is automatically added to the SEQOS Task Queue.
When warehouse stock levels are below the minimum holding stock for a product, or when future picks will reduce the stock level below the allowable minimum within a specified time span, taking into account supplier delivery lead times, then an order to the supplier for more stock is automatically triggered.
As stock is received into the warehouse, putaway tasks for that stock are automatically added to the Automated Task Queue. SEQOS calculates (1) whether the received stock should be moved directly to a pickface if stock already in the warehouse is insufficient to replenish that pickface, or (2) whether the received stock should be putaway into a bulk storage location. If an outstanding picking order is waiting for the stock due to there being no other suitable stock in the warehouse, then (3) the received stock may be directly picked from its current bulk location without moving it to a picking location.
KANBAN style kitting or assembly may also use SEQOS-triggered events. Multiple levels of kitting are supported. Building a finished product triggers events to build component products down each level in the assembly line. As the component products are consumed at a lower level in the assembly line to make a product at a higher level, stock replenishment is automatically generated to move more component products into the assembly area. Using this method, made-to-order products may be quickly assembled.
Reducing inventory in the warehouse can be achieved by pushing back the pick-pack process to the supplier or to another warehouse where storage costs are lower. For example, (1) a warehouse in China packs orders and labels the cartons with the delivery addresses for Australian customers. When (2) the cartons arrive at a depot in Australia, the (3) cartons are scanned, (4) validated against a file of carton data received from China, then (5) despatched. If the cartons are not yet due for despatch, they are put into temporary storage. On the due date, picking is triggered to move the cartons to the despatch area.
The SEQOS GS1-compliant SSCC label can be used by transport companies at their depots to automatically divert cartons to the appropriate truck routes.
Good Warehouse Layout Minimises Stock Movements
Picking is often the warehouse activity with the highest cost. Slotting the warehouse stock of the fastest-moving products near the despatch area reduces the total time for the day’s picking. SEQOS analyses product throughput to classify the products, typically ABC Inventory Classification, but can extend to any number of classifications.
The fastest-moving products are automatically assigned pickfaces or locations near the despatch area, with the slowest-moving products are located furthest from the despatch area. (This assignment may be overridden due to specific storage requirements). When a pallet of bulk product is received, SEQOS attempts to store that pallet at a bulk location near the pickface for that product, so that there is minimal movement for a subsequent replenishment action.
Pending putaway, replenishment and picking transactions are automatically added to the SEQOS Automated Task Queue and assigned a priority depending on configurable rules.
When SEQOS searches for the next stock movement task to assign to an RF-terminal operator, stock movements with similar priority from locations near to the current position of the operator are considered, and the most appropriate task is assigned to the operator. The objective is to maximise employee productivity by SEQOS-directed task allocation to staff.
Dissimilar tasks can be automatically interleaved by the system. For example, (1) a putaway from the receiving area to a bulk location, followed (2) by a replenishment from a nearby bulk location to a picking location, followed (3) by a pick from a nearby picking location to the despatch area, before the next putaway (4) from the receiving dock.