Distribution and warehouse management are the key areas of supply chain logistics management and customer service. The focus of D&WM is to track inventory in real-time; like the items that are in stock and the ones that need re-ordering. Today, we’ll discuss distribution and warehouse management; their separate definitions, goals and objectives, benefits, and key differences.
What is Distribution Management?
Distribution management comprises of various activities and processes like warehousing, inventory management, receiving, picking, material management, and transportation. It is much more than just shipping of goods from one place to another. However, DMS (distribution management system) manages, tracks, and organizes inventory and stock throughout the supply chain network and process.
Distribution management is significant for businesses and companies and it allows them to analyze their pricing strategies and increase their profitability. It allows them to gain a competitive edge in the market.
The direct delivery of products and goods would reduce the warehousing cost. If the location of the distribution center is at a distant place, then it makes you to deal with the inventory and trucking costs. In short, we can say that distribution and warehouse management go hand in hand and offer you cost-efficient methods to deliver goods.
What is Warehouse Management?
Warehouse management is the method of storing and managing stored goods in a large spacious building called a warehouse. The function of the warehouse is to store a mass volume of goods; managing manual labor, delivery, documentation, certification, and examining the goods. However, there are three types of warehouses and they’re as follows;
- Public: government institutions employ public warehouses for the storage of confiscated contraband
- 3PL: private businesses and companies employ 3rd party logistics providers to manage their storage needs; some of the clients of 3PL are manufacturers, importers, exporters, and wholesalers.
- In-house: companies store their raw supplies and finished goods in-house
Warehousing also deals with unfinished products and goods before distribution like packaging material and raw supplies. The warehouses would perform the function of packing and assembling, and the outlook of the product would be new upon delivery and the distribution centers.
Goals of Distribution and Warehouse Management
Some of the main goals and objectives of distribution and warehouse management are as follows;
Better Customer Service
Offering great customer service in the warehouse or the storage facility and transporting goods in a timely manner to develop professional relationships with businesses. You need to pay heed to customer complaints and feedback to satisfy their goals and objectives.
You need to decrease the expenses by reducing the warehousing and distribution costs, it helps your business to improve profitability and net revenue. The latest technological tools and applications and the best transportation channels would help you to achieve cost efficiency in the warehousing and distribution process by limiting damage to goods and consumption of resources.
Service quality analysis allows you to achieve continuous improvement by recognizing the key areas of improvement. It would help you to improve the customer service quality, remove inefficiencies, and decrease cost.
Optimum Usage of Equipment
You need to employ the warehousing staff and equipment at the optimum level and make sure the staff is utilizing the equipment at the optimum level. It helps you to avoid poor services and the cost of hiring.
Benefits of Distribution and WM
Some of the main benefits of distribution and warehouse management are as follows;
- Proper management of warehousing and distribution helps you achieve efficiency
- Ensure the timely delivery of products and goods at the right destinations
- Effective warehousing ensures the availability of sufficient stock to satisfy the customer’s orders
- Decrease cost and improve efficiency in the supply chain processes
Key Differences between D&WM
Some of the main differences between distribution and warehouse management are as follows;
Businesses and companies employ warehouses to store products and goods until needed. Companies store goods in distribution centers for various reasons like packaging, order fulfillment, cross-docking, and product mixing.
Companies store products and goods in the warehouse for a long time. On the other hand, businesses store goods in the distribution centers for a short time because they have a high and speedy flow rate and they ship it to the stores and customers.
Role & Focus
Distribution centers bridge the gap between consumers and suppliers, they pack goods and then ship them to the customers. The focus of warehouses is on the storage of goods, rather than focusing on the customers and consumers.
Distribution centers often process retail and warehouse orders in order to serve the needs and demands of customers. However, warehouses don’t serve customer orders like the distribution facilities.
The operations of warehousing facilities are very simple and easy. The functions and operations of distribution centers are warehousing, inventory, transportation, and order processing.
Conclusion: Distribution and Warehouse Management
After an in-depth study of distribution and warehouse management; we have realized that distribution and warehousing play a key role in supply chain management. If you are learning about warehousing and distribution, then you should keep in mind the abovementioned goals and objectives, key differences, and benefits.
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