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Operations Management: An Integrated Approach, 5th Edition by Nada R. Sanders, R. Dan Reid

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SUPPLY CHAIN DISTRIBUTION

The Role of Warehouses

Warehouses include plant, regional, and local warehouses. They can be owned or operated by the supplier or wholesaler, or they can be public warehouses. A further classification is general warehouse or distribution warehouse.

A general warehouse is used for storing goods for long periods with minimal handling. A distribution warehouse is used for moving and mixing goods. Within the supply chain, warehouses have three roles: transportation consolidation, product mixing or blending, and service. The business of a general warehouse is storage. The business of a distribution warehouse is movement and handling; therefore, the size of the facility is less important than its throughput. At a distribution warehouse, goods are received in large-volume lots and broken down into small individual orders.

images General warehouse

Used for long-term storage.

images Distribution warehouse

Used for short-term storage, consolidation, and product mixing.

LINKS TO PRACTICE Fingerhut Direct Marketing, Inc.

www.fingerhut.com

images

A good example of the importance of distribution warehousing in support of e-commerce is Fingerhut's warehouse in St. Cloud, Minnesota. Employees ...

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