A lot of logistics professionals use the terms warehouse and distribution center interchangeably. Some of them even say that “there is effectively no difference between a warehouse and a distribution center”. So, how different is a distribution center from a warehouse? Let me tell you upfront that they are as different as a modern 21st century supply chain is from a traditional supply chain.
The simple rule in traditional supply chains was to store “maximum possible quantity of every product, everywhere, every time”
This rule had to be followed because of lack of information flow and planning mechanisms in the supply chain. This gave birth to the warehouses which were used for stockpiling inventory and inventory would be shipped out months after it arrived in the warehouse.
Supply chains have evolved and are much different from what they used to be say 2-3 decades back. Modern supply chains equipped with better information & intelligence are able to predict product demand well in advance, plan accordingly and deliver the items close to when they are needed.
The new supply chain rule is to have “the required quantity of the right product in the right place at the right time”
The traditional warehouses are not completely fit to cater to this new supply chain rule and this led to the evolution of static warehouses into distribution centers. Now that you know the context, let me tell you the exact difference between a warehouse and a distribution center:
- A warehouse is used for storing products while a distribution center, apart from storing products offers value-added services like product mixing, order fulfillment, cross docking, packaging etc.
- A distribution center stores products for relatively lesser periods compared to a warehouse. So, basically the flow velocity through the distribution center is much greater than the flow velocity through a warehouse.
- A distribution center is customer-centric and is the bridge between a supplier and its customers.
- While the role of a warehouse is to store products efficiently, the role of distribution centers is to efficiently meet customer requirements.
- Typically retail and warehouse orders are shipped from a distribution center and not a warehouse. Basically a warehouse generally doesn’t serve external customers while a distribution center does.
- The operations at a distribution center is much more complex than that at a warehouse.
- As a result, the distribution centers are equipped with latest technology for order processing, warehouse management, transportation management etc.
You now know the stark difference between a warehouse and a distribution center and how the evolution happened over time.
- Does this mean that warehouses no longer exist or they don’t serve any purpose?
You will be mistaken if you believe that. Warehouses still exist and serve a purpose. A good example would be how inventory is pre-built months in advance to meet the high seasonal demand and is stored in typical warehouses before being sent to a distribution center for customer service.
However, the importance of warehouses in supply chain has gone down and the distribution centers have now emerged as the nerve centers of the modern supply chains.
- Goods in (or goods inward): Usually containing specialized container unloading equipment and workers, including pallet wrapping, conveyor belt unloaders (as used on 40 ft shipping containers), forklift drivers, and administrative staff
- Bulk: As a rule, a bulk department controls and ships larger orders or orders that contain only full cartons/boxes. A bulk department includes forklift truck drivers to load containers and wagons, and man-up or combi forklift trucks to unload full pallets from warehouse racking.
- Break-bulk: Break-bulk (also known as split case) is a lower-capacity version of the bulk department. Orders usually contain part boxes or items not requiring pallets. Due to the number of smaller customers a distribution center may serve, a break-bulk department may need more workers than a bulk department. A break-bulk department usually uses trolleys or, for palleted/heavy orders, small electric PPT or walkie low lift trucks. Items shipped by break-bulk are usually stored in pick, which are usually the bottom two pick-faces of warehouse racking. A pick-face is the space on such a racking system onto which a pallet can be loaded.
- Export: An export department controls orders which are leaving the country of the distribution center. This department is almost identical in function to a bulk or break-bulk department; however, workers in this department build pallets conforming to different standards and sizes. An export department also uses different shipping containers or haulage firms.
- Quality assurance: A quality assurance (QA) department performs periodic checks of random samples of stock to check quality, including from the warehouse racking, goods in, and returned stock. This department may also take on cycle count duties to find missing stock.
- Packing and production: In many distribution centers it is not feasible to store stock in many different packaging styles or quantities, and while it may cost a customer more to do so, many customers, such as supermarkets, prefer their own packaging on stock. Because of this, packing benches are used to take raw items, such as a box of balloons, and pack them at a specific unit quantity, which are then packed into cartons and labeled accordingly for a customer. In many circumstances this may be more inexpensively done at a distribution center than by a customer or client.
- Transportation: Arranges and coordinates shipments in and out of the distribution center.
- Dedicated product departments: Divisions may be based on handling characteristics or storage characteristics, for example, refrigerated and non-refrigerated [meat and produce, frozen, dairy/deli, dry]. Each of these three areas have both shipping and receiving departments as well.
- Unloader – unloads trucks and breaks down pallets as needed, using various pieces of power equipment
- Receiver – inventories and tags unloaded pallets using a mobile cart computer unit and printer
- Hauler – transports received pallets with equipment from the receiving dock to the storage racks
- Putaway driver – puts product into racks with forklift
- Lumper – helps unload shipments
- Replenishment driver – pulls product from the racks and places it into the “pick slot” with forklift
- Order filler – picks product from the “pick slot” by hand and moves with power equipment
- Loader – wraps the order-filled pallets and loads trucks, using equipment
- Supervision – floor (process) supervision, indirect labor supervision
- Human resources – employment office and employee benefits
- Facilities and housekeeping – maintenance of buildings
- Inventory management – tracking and placement of product
- Quality control – inspection and acceptance of incoming and outbound product
- Asset protection – building security and loss prevention
- Safety – insurance of safe operating practices
- Equipment maintenance – electrical, mechanical, and pneumatic maintenance of MHE
- Operations research – Industrial engineering, process improvement, labor standards
- Information technology – support of information systems
- Water Spider – replenishes cardboard, bubble wrap, tape, etc. for warehouse packers
Water spider is a term that refers to a specific person whose main job is to take care of intermittent tasks such as supplying material at workstations.
hi my name is simon project manager for lean manufacturing structure at flexpipe a water spider refers to specific person whose main job is to take care of recurrent tasks such as supplying materials at workstation and meeting occasional needs around the plant similar to the assistance provided to a medical surgeon the water spider enables the performance of value-added tasks with no distractions the role of a water spider in manufacturing is often confused with somebody who simply handles material however in a lean manufacturing layout a water spider must be fully knowledgeable of the process or work cells they support in other words a water spider does not just pick up and drop off materials but instead is the go to person for out of cycle task for example a water spider can supply raw materials and parts transport finished goods away from the work area remove waste move kanban cards update status board pack materials to be taken away replace tools help with changeovers and keep an eye on less experienced workers a water spider needs to make sure that the production flow is not interrupt and the workers are only devoted to value-added tasks they should visit the workstations and operators in the same order and at a similar intervals the speeds and frequency of their rounds should be based on the processing needs water spider is mizu sumashi in japanese it means make water cleaner while some floor manager might feel the urge to put a less skilled worker in this position this is not a good idea in order for water spiders to really boost productivity they need to have an in-depth understanding of the whole production process they must be able to read the whole workspace here are some important requirements for the job knowledgeable of all production processes extensive work experience good working relationship with management able to promptly raise issues some japanese sensei have said that the water spiders role is a rite of passage to becoming a supervisor this is why it makes a lot of sense to treat the position as a way to groom a future leader keys to a successful water spider clearly define the water spiders task and those outside the scope of the job although a water spider may not need to perform their role full time in smaller work areas ensure that their rounds are still made at regular intervals to plan for the workload of a water spider a clear process flow and define work sequence are required at the beginning the role should be tested out on a small scale to get a feel for how this position can be leveraged here’s some additional recommendation for every workstation on the assembly line create a spaghetti diagram of the stock replenishment pack work on small and regular runs cluck the water spider with a pedometer to lock the typical distance travel and determine how this could be improved the manufacturing supermarket should not be too far from the assembly line there may be more than one supermarket for longer lines an exhausted water spider is a sign that something is wrong try to identify and rectify the cause as you can see a well-organized water spider can help you boost your overall efficiency it could potentially help you measure an roi that can be presented to management it also isolates the auxiliary tasks which are mostly transportation and movement waste thereby helping you reduce or eliminate these stats entirely you
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