Section 2： Distribution and Warehousing
There are some experts in this field that predict the demise of warehouses because inventory stocking will no longer be needed. They claim that ECR and JIT in combination with POS data will fully synchronize the company's demand chain. Most other experts disagree and believe that integrated logistics will spur DCs to modify their roles， which will be based on speeding the flow of product and providing value-added services. Examples of the changing role of warehouses can be seen in consolidations of shipments， crossdocking， and value-added processes such as packaging， sub-assembly， kitting， labeling， and final custom work such as providing color and style to products based on customer orders. Certainly， eCommerce has led to warehouse expansion in the USA and Europe and refocus by existing warehousing companies.
Basically， warehouses hold inventory and inventory itself should not be viewed as a total liability because only bad inventory is a liability （bad is defined as obsolete or excess）。 Therefore， the right inventory available in the right location at the time needed allows a company to achieve customer satisfaction. This remains the underlying role of the warehouse regardless of technology advances. As a general benchmark， warehousing averages approximately 2.5% of sales for a manufacturing company.
Bar Code： Information embedded into an identification pattern of parallel bars that can be read by an electronic scanner （hand held or stationary scanner）。
Bar Code Scanner： A device that reads bar codes with a built-in laser and transmits information to a computer for inventory management and sales purposes.
Batch picking： A process whereby the goods are selected in quantities to meet the demand for more than one order. Goods are first picked by SKU， and later sorted by order， address， and other criteria.
Batch： A group of orders in the same wave， picked in one pass through the warehouse.
Bin： A bar-coded location in the warehouse where product is stored.
Bill of Lading： A document used to record the receipt of goods.
Carrier： A trucking company usually unrelated to Shipper， that transports a shipment.
Carton： A box into which an order is packed.
Compliance Label： A type of shipping label for cartons that conforms to major retailers' standards for format， size， and bar code size （length/type）。
Consignment： Occurs in warehousing where consignor （property or merchandise owner） appoints consignee as a merchandise depository （the warehouse operator） and the consignee holds and cares for property； however， title to the merchandise remains in the name of the consignor. Property remains under and subject to the control of the consignor.
Cross-dock： A temporary storage facility， not necessarily a warehouse， which is situated close to the marketplace that acts as a transfer point. Palletized cargo is supplied [usually at night using tractor-trailers] to the cross-dock and then transferred， using forklifts， off the dock to other trucks or tractor-trailers， which make deliveries into the geographic area served. There is no storage of product. The positioning of the cross-dock enables the vehicles domiciled there to make multiple turns each day which could not be accomplished by straight through deliveries from a manufacturing plant.
Consumer direct program： Consumer home shopping for groceries bypassing the supermarket. Orders are placed via websites on the Internet （Peapod， Inc.）， fax， or telephone. Chains and superstores like Wal-Mart and Kroger offer this program in certain geographic areas.
Cycle Counts： A way of physically counting and verifying inventory levels.
Data Collection Terminal： A stationary terminal connected to a host computer as part of a data collection system.
Data Collection Terminal-Portable： A handheld or forklift mounted terminal that collects and processes data from bar code readers， key entry， and the like.
EAN： European Article Number. This is the international product marking bar code standard.
Fill Rate： Customer service ratio. A set of performance measures of the volume of orders shipped on time and complete.
Flow-Thru Warehousing： The movement of product from different methods of inbound transport to the manufacturing process using a metered JIT delivery system. Reduces the need for on-site warehousing at the manufacturing facility and frees up space for production or operations.
Kitting： The process by which individual items are grouped together to create a single item. An example would be sub-assembly of tires onto wheels in an off-site warehouse in the automotive manufacturing industry with re-shipment to the assembly line on a JIT basis.
Mixed case： A case or carton that is filled with multiple SKUs.
Pallet Jack： A device used by a dockworker or driver to lift and move pallets of freight. The operator uses it from a standing position as opposed to a sitting position on a forklift truck. A pallet jack may be manual or electrically powered.
Put-to-light： A warehousing picking system where selections are made with a hand-held transmitter which reads customer orders， assists with breaking packs （making selections from split cases）， reads labels to get SKUs and places items at assigned door locations for loading on trailers. Put-to-light，
Returnables： Re-usable containers， pallets， bins， rolls， and/or parts， or other customer goods that need to be shipped back or otherwise returned to shipper （usually at point of origin）。
SKU： Abbreviation for “stock keeping units”。 This is a method for tracking inventory and usually involves bar coding methodology for computerized automatic stock reordering or replenishment.
SLC： Shippers Load and Count. This is a notation made on bills of lading when that carrier has not been allowed to observe or cannot count the freight being loaded on its trailer， this limits the liability of the carrier from shortage claims.
Slipsheet： A flat， plastic or cardboard replacement for wooden pallets used for storage and shipment purposes.
VAP： Value-added Processing. Refers to tasks normally performed by manufacturing but now being moved into distribution as final processing decisions are postponed until order fulfillment. These tasks include packaging， labeling， and mass customization of configurations （e.g.， size， style， and colors）。
VMI： Vendor Managed Inventory. VMI is a demand inventory replenishment solution that monitors sales data and inventory levels to maintain optimum inventory levels. The data allows companies to forecast and plan better and thus react quickly to market changes and customer needs resulting in lower inventory levels. Typically， information is shared so both suppliers and distributors and/or customers can improve demand forecasting， marketing or merchandising activities， replenishment planning， and transportation load planning. Often， a manufacturer holds inventory sold or to be sold to a customer in a specific location（s） based on customer order levels and releases shipments， as customer requires the goods. Saves customers money by utilizing manufacturers warehouse space， handling labor， and often results in the customer receiving better payment terms.
Wave and Batch Picking： Time scheduling method for picking by SKUs. Wave picking is releasing a defined amount of work to pickers for a set time. Batch picking involves picking a particular item for many orders simultaneously and then sorting the items later by order.
WMS： Warehouse Management Systems. A system designed to help the user in the warehouse to fulfill the needs of various corporate systems， such as order entry， materials requirements planning， and distribution， with speed and efficiency. A WMS works in real time， eliminating batch processing and the status delays usually associated with typical inventory systems. WMS transforms information from the corporate systems into an optimized plan for the warehouse. In the paperless warehouse， WMS issues instructions to materials handlers for SKU selection through their radio frequency terminals.
SYSTEMS GLOSSARY——TRADITIONAL
Receiving Activities
ASN/EDI： Advance Shipping Notification （from or to suppliers， carriers， and consignees） sent in advance of a shipment listing contents and shipping information transmitted via Electronic Data Interchange.
Conventional： Manual or lift truck handling of receipts with key entry or bar code scanner input of relevant data.
Automatic： Receipts moved via conveyor/AGVS past automatic scanner.
Purchase order： Receipts checked against user's purchase order.
Lot/date codes： Item lot numbers recorded as part of the receiving process and normally tracked throughout processing.
Serial number： Serial numbers recorded as part of the receiving process and normally tracked throughout processing. Vendor： Files maintained by and receipts logged by vendor.
QC sampling： Samples pulled from incoming shipments for QC （Quality Control） with balance of receipt quarantined until samples released.
Receipts tagging： Receipts tagged with unique number and/or bar code to facilitate storage， picking， and tracking.
Crossdocking： Backordered or hot items spotted at receiving and moved directly to shipping. Returns： System manages returns processing and disposition.
Storage/Putaway Conventional： Material moved by manually or by lift truck， pallet truck， etc.
Mechanized： Material moved by conveyor/AGVS， or automated storage system （AS/RS， mini-load， carousel， etc.）
Operator directed： Operator selects storage location and manually enters into warehouse management system.
System directed： System selects storage location and produces putaway ticket or transmits to operator terminal. Dedicated storage： Zones and/or slots dedicated to particular SKUs or products.
Random storage： Zones ABC/or slots not assigned. Forward pick： System replenishes forward pick locations from receiving and reserve storage.
Verification： System requires operator to verify bar-coded putaway location using bar code reader and/or radio frequency data terminal.
Quarantine： System can inhibit puts to and picks from any location.
Inventory Control
Units of measure： System accommodates multiple UOMs and conversions.
Shelf life： System monitors product expiration dates.
QC Hold： System quarantines material until quality control release.
Bulk stores： System maintains bulk/non-conveyable inventories.
Lot tracking： Lot integrity maintained and managed by system. Note that date codes and serial numbers can also be tracked.
Consolidation： System utility for consolidating partial pallets of same SKU.
Relocation： Utility that permits operator to execute and record material moves from one storage location to another.
Cycle counting： System supports anomaly-driven and routine inventory checking.
Order Processing Conventional： Orders processed by host computer and downloaded to WMS for filling.
Local terminal： Order entry via warehouse terminal.
Emergency： Override utility that permits insertion of emergency order ahead of scheduled picks.
Back orders： System handles backorders.
There are some experts in this field that predict the demise of warehouses because inventory stocking will no longer be needed. They claim that ECR and JIT in combination with POS data will fully synchronize the company's demand chain. Most other experts disagree and believe that integrated logistics will spur DCs to modify their roles， which will be based on speeding the flow of product and providing value-added services. Examples of the changing role of warehouses can be seen in consolidations of shipments， crossdocking， and value-added processes such as packaging， sub-assembly， kitting， labeling， and final custom work such as providing color and style to products based on customer orders. Certainly， eCommerce has led to warehouse expansion in the USA and Europe and refocus by existing warehousing companies.
Basically， warehouses hold inventory and inventory itself should not be viewed as a total liability because only bad inventory is a liability （bad is defined as obsolete or excess）。 Therefore， the right inventory available in the right location at the time needed allows a company to achieve customer satisfaction. This remains the underlying role of the warehouse regardless of technology advances. As a general benchmark， warehousing averages approximately 2.5% of sales for a manufacturing company.
Bar Code： Information embedded into an identification pattern of parallel bars that can be read by an electronic scanner （hand held or stationary scanner）。
Bar Code Scanner： A device that reads bar codes with a built-in laser and transmits information to a computer for inventory management and sales purposes.
Batch picking： A process whereby the goods are selected in quantities to meet the demand for more than one order. Goods are first picked by SKU， and later sorted by order， address， and other criteria.
Batch： A group of orders in the same wave， picked in one pass through the warehouse.
Bin： A bar-coded location in the warehouse where product is stored.
Bill of Lading： A document used to record the receipt of goods.
Carrier： A trucking company usually unrelated to Shipper， that transports a shipment.
Carton： A box into which an order is packed.
Compliance Label： A type of shipping label for cartons that conforms to major retailers' standards for format， size， and bar code size （length/type）。
Consignment： Occurs in warehousing where consignor （property or merchandise owner） appoints consignee as a merchandise depository （the warehouse operator） and the consignee holds and cares for property； however， title to the merchandise remains in the name of the consignor. Property remains under and subject to the control of the consignor.
Cross-dock： A temporary storage facility， not necessarily a warehouse， which is situated close to the marketplace that acts as a transfer point. Palletized cargo is supplied [usually at night using tractor-trailers] to the cross-dock and then transferred， using forklifts， off the dock to other trucks or tractor-trailers， which make deliveries into the geographic area served. There is no storage of product. The positioning of the cross-dock enables the vehicles domiciled there to make multiple turns each day which could not be accomplished by straight through deliveries from a manufacturing plant.
Consumer direct program： Consumer home shopping for groceries bypassing the supermarket. Orders are placed via websites on the Internet （Peapod， Inc.）， fax， or telephone. Chains and superstores like Wal-Mart and Kroger offer this program in certain geographic areas.
Cycle Counts： A way of physically counting and verifying inventory levels.
Data Collection Terminal： A stationary terminal connected to a host computer as part of a data collection system.
Data Collection Terminal-Portable： A handheld or forklift mounted terminal that collects and processes data from bar code readers， key entry， and the like.
EAN： European Article Number. This is the international product marking bar code standard.
Fill Rate： Customer service ratio. A set of performance measures of the volume of orders shipped on time and complete.
Flow-Thru Warehousing： The movement of product from different methods of inbound transport to the manufacturing process using a metered JIT delivery system. Reduces the need for on-site warehousing at the manufacturing facility and frees up space for production or operations.
Kitting： The process by which individual items are grouped together to create a single item. An example would be sub-assembly of tires onto wheels in an off-site warehouse in the automotive manufacturing industry with re-shipment to the assembly line on a JIT basis.
Mixed case： A case or carton that is filled with multiple SKUs.
Pallet Jack： A device used by a dockworker or driver to lift and move pallets of freight. The operator uses it from a standing position as opposed to a sitting position on a forklift truck. A pallet jack may be manual or electrically powered.
Put-to-light： A warehousing picking system where selections are made with a hand-held transmitter which reads customer orders， assists with breaking packs （making selections from split cases）， reads labels to get SKUs and places items at assigned door locations for loading on trailers. Put-to-light，
Returnables： Re-usable containers， pallets， bins， rolls， and/or parts， or other customer goods that need to be shipped back or otherwise returned to shipper （usually at point of origin）。
SKU： Abbreviation for “stock keeping units”。 This is a method for tracking inventory and usually involves bar coding methodology for computerized automatic stock reordering or replenishment.
SLC： Shippers Load and Count. This is a notation made on bills of lading when that carrier has not been allowed to observe or cannot count the freight being loaded on its trailer， this limits the liability of the carrier from shortage claims.
Slipsheet： A flat， plastic or cardboard replacement for wooden pallets used for storage and shipment purposes.
VAP： Value-added Processing. Refers to tasks normally performed by manufacturing but now being moved into distribution as final processing decisions are postponed until order fulfillment. These tasks include packaging， labeling， and mass customization of configurations （e.g.， size， style， and colors）。
VMI： Vendor Managed Inventory. VMI is a demand inventory replenishment solution that monitors sales data and inventory levels to maintain optimum inventory levels. The data allows companies to forecast and plan better and thus react quickly to market changes and customer needs resulting in lower inventory levels. Typically， information is shared so both suppliers and distributors and/or customers can improve demand forecasting， marketing or merchandising activities， replenishment planning， and transportation load planning. Often， a manufacturer holds inventory sold or to be sold to a customer in a specific location（s） based on customer order levels and releases shipments， as customer requires the goods. Saves customers money by utilizing manufacturers warehouse space， handling labor， and often results in the customer receiving better payment terms.
Wave and Batch Picking： Time scheduling method for picking by SKUs. Wave picking is releasing a defined amount of work to pickers for a set time. Batch picking involves picking a particular item for many orders simultaneously and then sorting the items later by order.
WMS： Warehouse Management Systems. A system designed to help the user in the warehouse to fulfill the needs of various corporate systems， such as order entry， materials requirements planning， and distribution， with speed and efficiency. A WMS works in real time， eliminating batch processing and the status delays usually associated with typical inventory systems. WMS transforms information from the corporate systems into an optimized plan for the warehouse. In the paperless warehouse， WMS issues instructions to materials handlers for SKU selection through their radio frequency terminals.
SYSTEMS GLOSSARY——TRADITIONAL
Receiving Activities
ASN/EDI： Advance Shipping Notification （from or to suppliers， carriers， and consignees） sent in advance of a shipment listing contents and shipping information transmitted via Electronic Data Interchange.
Conventional： Manual or lift truck handling of receipts with key entry or bar code scanner input of relevant data.
Automatic： Receipts moved via conveyor/AGVS past automatic scanner.
Purchase order： Receipts checked against user's purchase order.
Lot/date codes： Item lot numbers recorded as part of the receiving process and normally tracked throughout processing.
Serial number： Serial numbers recorded as part of the receiving process and normally tracked throughout processing. Vendor： Files maintained by and receipts logged by vendor.
QC sampling： Samples pulled from incoming shipments for QC （Quality Control） with balance of receipt quarantined until samples released.
Receipts tagging： Receipts tagged with unique number and/or bar code to facilitate storage， picking， and tracking.
Crossdocking： Backordered or hot items spotted at receiving and moved directly to shipping. Returns： System manages returns processing and disposition.
Storage/Putaway Conventional： Material moved by manually or by lift truck， pallet truck， etc.
Mechanized： Material moved by conveyor/AGVS， or automated storage system （AS/RS， mini-load， carousel， etc.）
Operator directed： Operator selects storage location and manually enters into warehouse management system.
System directed： System selects storage location and produces putaway ticket or transmits to operator terminal. Dedicated storage： Zones and/or slots dedicated to particular SKUs or products.
Random storage： Zones ABC/or slots not assigned. Forward pick： System replenishes forward pick locations from receiving and reserve storage.
Verification： System requires operator to verify bar-coded putaway location using bar code reader and/or radio frequency data terminal.
Quarantine： System can inhibit puts to and picks from any location.
Inventory Control
Units of measure： System accommodates multiple UOMs and conversions.
Shelf life： System monitors product expiration dates.
QC Hold： System quarantines material until quality control release.
Bulk stores： System maintains bulk/non-conveyable inventories.
Lot tracking： Lot integrity maintained and managed by system. Note that date codes and serial numbers can also be tracked.
Consolidation： System utility for consolidating partial pallets of same SKU.
Relocation： Utility that permits operator to execute and record material moves from one storage location to another.
Cycle counting： System supports anomaly-driven and routine inventory checking.
Order Processing Conventional： Orders processed by host computer and downloaded to WMS for filling.
Local terminal： Order entry via warehouse terminal.
Emergency： Override utility that permits insertion of emergency order ahead of scheduled picks.
Back orders： System handles backorders.