From manufacturing plants to retail stores, how important is material handling to the economy of a country?
We can look at this in 4 stages starting from manufacturing plant to mother DCs, consumption warehouses and finally to the retail stores.
Manufacturing Plant: In a manufacturing plant, raw materials need to be transported and conveyed to the packaging equipment; from here once everything is packed and palletised, it must go into the finished goods warehouse. In all these functions material handling plays a very critical role as there is a certain kind of inventory that needs to be stored, certain inventory that needs to be received at packaging and raw material warehouses, and they need to be brought to the shop floor. When it needs to be brought, it needs to be transported in a certain sequence and at a certain speed. This is what material handling does in a factory; apart from that when the goods are manufactured, they are stored for a certain period, especially in industries like Pharma it can go for a month as well, because the products need to be stored for one month and different quality parameters need to be tested before it can be released in the market. Otherwise also in India, industries such as White Goods, FMCG, Chemicals and Specialty Chemicals do store 3-30 days of inventory. This inventory needs to be mapped like where it needs to be stored, stacked and dispatched in a timely manner according to the needs of the other warehouse, which is at the consumer centre or as per the customer needs. In all these things, when one needs to store, move, and pick inventory one needs methods of material handling. For example, rack storage, pallet shuttle storage, AS/RS storage like single deep or double deep, etc., depending on the kinds of throughput, inventory, and the velocity profile of the inventory in the warehouse.
In the Indian context, the productivity of factories depend highly on how we move these raw materials, packing materials, and finished goods in the factory. Once productivity increases as a country we become more competitive and that boosts the economy as far as contribution of manufacturing to the economy.
Mother Distribution Centres: Where material comes from different manufacturing plants, and goes to the consumption stores. Here goods happen in the form of carton/pallet and goods out happens in most cases. Storage accuracy, density, throughput of both inwarding and outwarding will be managed by the kind of material handling equipment we use. Also the kind of inventory whether to cross dock, store for some time and if so, how long to store, etc., are all possible due to the kind of material handling methods and equipment we use.
Consumption Warehouses: Very near to the retail stores, sometimes a part of the retail stores, Micro Fulfilment Centres revolutionised the consumption of the retail e-grocery segment. Equipped with the modern day material handling equipment such as AMRs or AGVs, shuttle systems, mini-load AS/RS systems, picking technologies such as pick to light, pick by voice or pick by vision and warehouse software such as WMS/WCS/WES, these consumption warehouses enable delivery within 2-4 hours of ordering.
Retail Stores: For the goods to reach the retail stores, there is primary transportation where in from manufacturing plant to distribution centre in case of manufacturer, in case of organised retail, purchasing happens from mother distribution centre to either consumer warehouse and from a consumer warehouse to retail store. This plays an important role to the economy due to the sheer amount of work involved and the complexity of the material handling involved to achieve the objectives of customer satisfaction, low cost operations and overall supply chain efficiency.