Material Handling

• Material handling is the movement, protection,

storage, and control of materials and products
throughout the entire supply chain, from raw materials
to finished goods and disposal. It uses a system of
manual, semi-automatic, and automated equipment to
ensure the right materials reach the right place at the
right time, in the right condition, with the goals of
increasing efficiency, reducing costs, and enhancing
worker safety. Key activities include loading, unloading,
transporting, and storing items, often within
warehouses and production facilities.
 Automated Storage and Retrieval
Systems
• Automated Storage and Retrieval Systems (ASRS) are computer-controlled
robotic systems that automatically store, retrieve, and manage inventory
in high-density storage racks, using equipment like cranes, shuttles, and
conveyors. By eliminating manual labor and optimizing vertical space,
ASRS systems boost productivity, improve accuracy, enhance safety, and
provide real-time inventory control, making them crucial for modern
warehouses and distribution centers across various industries.
How an ASRS Works
1. Storage:
• When a new item arrives, a Warehouse Management System (WMS)
assigns a location, and an automated machine retrieves the item and
places it into the high-density racks.
2. Retrieval:
• When an item is needed, the computer system identifies its location and
directs the automated machinery to retrieve it.
3. Movement:
• The retrieved item is then transported by automated cranes or shuttles to
a designated output station, where it can be picked up by an operator or
integrated into a conveyor system.
 Automated Storage and Retrieval
Systems
Components of an ASRS:
• Storage Structure: High-density racks or shelving designed to
maximize vertical space.
• Storage and Retrieval (S/R) Machines: Automated equipment, such
as cranes or shuttle vehicles, that transport loads within the storage
system.
• Conveyor Systems: Automated belts and rollers that move
materials into and out of the ASRS.
• Software: A Warehouse Management System (WMS) or Warehouse
Execution System (WES) that controls the entire operation, tracks
inventory, and directs the machinery.
• Input/Output Stations: Designated areas where items enter the
system for storage and leave the system for further processing or
distribution.
 Order Processing
• Order processing is the step-by-step workflow from a customer placing an
order to it being delivered, involving receiving, verifying payment and stock,
picking, packing, and shipping items, and is a crucial aspect of order fulfillment
that drives customer satisfaction and operational efficiency. Efficient order
processing, whether manual or automated, reduces errors and delays,
maintaining customer trust and supporting business growth.
Key Steps in Order Processing:
• Order Placement & Reception: The process begins when a customer submits
an order.
• Order Verification: Confirming the order details are correct, including
payment information and the customer's address.
• Inventory Check: Verifying that the requested products are available in stock.
• Order Picking: Physically selecting the items from the inventory or
warehouse.
• Packing: Securely packaging the selected items for shipment.
• Shipping & Handling: Preparing the order for delivery to the customer.
• Tracking & Delivery: Following the order through the shipping process to
ensure it reaches the customer.
• Notification & Follow-up: Informing the customer about the order status, and
handling returns if necessary.
 Transportation
• Transportation in material handling refers to the short-distance
movement of raw materials, components, and finished products within
an industrial, warehouse, or distribution environment using a variety
of manual, semi-automated, or automated equipment. Key equipment
includes industrial
trucks like forklifts, conveyors, cranes, and Automated Guided Vehicles
(AGVs). The goal is to improve efficiency, safety, and productivity by
ensuring materials are moved, stored, and controlled properly from
point A to point B in the supply chain.
Moving materials:
• Transporting raw materials to production, components along assembly
lines, and finished products to storage or distribution points.
Within a facility:
• This movement is typically confined to the interior of a factory,
warehouse, or distribution center.
From unloading to storage:
• The process includes unloading incoming goods, moving them to
storage areas, and transporting them from storage to their next
processing or packaging stage.
 Demand Forecasting
• Demand forecasting is the process of predicting future customer demand for a
product or service by analyzing historical data, market trends, and other relevant
factors. This enables businesses to optimize inventory, plan production, and make
informed decisions about sales, pricing, staffing, and resource allocation to
increase profitability and customer satisfaction while minimizing costs.
Why Demand Forecasting Is Important
Prevents Stockouts:
• Accurate forecasts ensure sufficient inventory to meet demand, preventing lost
sales and customer frustration.
Reduces Excess Inventory:
• Overestimating demand leads to surplus inventory, which ties up capital and
increases holding costs.
Optimizes Operations:
• It helps in planning production, warehousing, staffing, and resource allocation,
improving efficiency.
Enhances Profitability:
• By balancing supply and demand, businesses can maximize sales and minimize
waste.
Improves Decision-Making:
• It provides insights for budgeting, capital expenditures, and strategic planning
across the business.
 Impact of Forecasts on Logistics and
Supplychain Management
• Forecasts provide crucial, data-driven insights that allow logistics and
supply chain management to make informed decisions, leading
to improved efficiency, lower costs, and higher customer satisfaction. By
accurately predicting demand, companies can optimize inventory levels,
streamline production and distribution, coordinate effectively with
suppliers, and manage risks, ultimately building a more agile and resilient
supply chain.
Key Impacts of Forecasting on Logistics and Supply Chain Management:
Optimized Inventory Management:
• Forecasts help maintain the right balance of inventory, preventing
expensive overstocking and costly stockouts.
Enhanced Production Planning:
• By aligning production schedules with anticipated demand, businesses can
reduce waste and ensure resources are used efficiently.
Efficient Resource Allocation:
• Accurate forecasts enable better allocation of staff, materials, and other
resources to meet demand effectively.
 Impact of Forecasts on Logistics and
Supplychain Management
Improved Logistics and Distribution:
• Forecasts inform decisions on shipping routes and delivery schedules,
ensuring timely and cost-effective fulfillment of orders.
Better Supplier Collaboration:
• Aligning supply chain operations with future demand allows for better
planning and coordination with suppliers, ensuring materials are available
when needed.
Increased Customer Satisfaction:
• Meeting customer demand promptly and consistently through accurate
forecasting leads to greater loyalty and satisfaction.
Reduced Costs:
• Optimized inventory, production, and logistics all contribute to significant
cost savings and increased profitability.
Improved Risk Management:
• By anticipating demand changes and potential disruptions, companies can
develop contingency plans, making the supply chain more resilient.
Informed Strategic Decision-Making:
• Forecasts provide essential data for making strategic decisions regarding
expansion, new technologies, and capital investments.
 Performance Measurements
• Performance measures in material handling assess efficiency through key
performance indicators (KPIs) like throughput, cycle time, cost, utilization, quality,
and safety. These metrics, such as material availability, fill rates, and equipment
utilization, help organizations identify bottlenecks, optimize resource use, and
improve overall performance in the movement and storage of materials.
• Key Performance Indicators (KPIs) & Metrics
• Time-Based Metrics:
• Cycle Time: The average time to move materials from one point to another.
• Material Availability: The percentage of time materials are ready and accessible
for production.
• Throughput: The rate at which materials are processed or moved.
• Cost & Resource Utilization:
• Material Handling Cost: The total cost of moving and storing materials per unit of
output.
• Equipment Utilization Ratio: The proportion of time that material handling
equipment is in use compared to total available hours.
• Direct Labour Handling Loss (DLHL) Ratio: The amount of direct labor time lost
due to inefficient handling processes.