Impact Of Effective Warehouse Management On Physical Distribution In A Manufacturing Organization

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Impact Of Effective Warehouse Management On Physical Distribution In A Manufacturing Organization


This research work on the impact of effective warehouse organization, with a case study of Unilever Nigeria Plc Aba is geared towards ensuring adequate warehouse management system in order to increase customer satisfaction, warehouse management as part of the activities of physical distribution focused more on the storage maintenance and distribution of finished goods to the appropriate areas they are needed.

In a manufacturing company where raw materials, stock of finished goods and accessories are handled the introduction of warehouse management is necessary for the profitability and accountability to both business whose interest and objectives must be protected. This project work is divided into five chapters, chapter one deals with the introduction, chapter two is a view of related literature on both the general economy and how it has affected the operations of Unilever Nigeria Plc Lagos.

The chapter three outline the methodology and procedure used in gathering the data. Chapter the last chapter five is recommendation summary and conclusion.

Chapter One

1.0 Introduction

1.1 Background of the Study

The functions of warehouse management is to provide cost effective storage, in a suitable condition for the organization’s products and materials to enhance effective rendering of customer services. The existence of a warehouse is justified by the extend to which it contributes to the efficiency and effectiveness of physical distribution functions.

The geographical location of a warehousing operation should be determined by production sites and the physical position of target markets. However, in some developing countries as Nigeria, political conditions have some times over ride economic arguments and facilities such as warehouse, go downs, assembly areas and buying points for the government organization have been sub-optimally sited. Warehouse managers have a number of important challenges which include, determination of most appropriate unit loads optimizing space utilization, reducing the movement of labour, equipment and product/materials to minimum, establishing a safe, secure warehousing environment and keeping cost to minimum.

General Overview

An earlier resource pack described the decisions that must be taken when a company organizes a channel or network of intermediaries who take responsibility for the management of goods as they move from the producer to the consumer. According to Piasacki (1978), initially a system to control movement and storage of warehouse management system (WMS) is expanding to including light manufacturing, transportation management, order management and complete accounting system.

To use the grand father of operation, material requirement planning, (MRP) as a comparison, material requirement. Planning started as a manufacturing environment. What is clear is that the expansion of the over lap in functionality between warehouse management system and other functional area in physical distribution of goods from the producer to the consumer. Even through warehouse management contributes to gain added functionality, the initial core functionality of a ware house management system has not changed.

The primary purpose of a warehouse management system is to control the movement and storage of material within an operation and process the associated transactions. The detailed set up and processing within a warehouse management system in my area of case study Unilever Nigeria Plc Aba, varies significantly from one material render to another, however the basic logic will use a combination of item, location quantity, unit of measure and order information to determine where to stock, where to pick and in what sequence to perform these operations.

1.2 Statement of Problem

Manufactures of consumer products different types face the problem of getting their products to various market locations all over the country. The use of warehouses and intermediaries only distribute the products to the near by market place or states. Some rural areas where distributing warehouse could be located have no access roads. Other problems associated with this study are those of ineffective handling and storage of materials (goods) in the various warehouses, poor control of the movement of materials exist both from the manufacturing warehouse and their deport warehouses located at different strategic areas.

Another problem is their ability of managing the material goods in the warehouse in order to identity the expired goods and avoid mixing them up with the normal ones. Supply of goods to the various warehouse to meet customer demand are sometimes delay, as a result of poor scheduling of vehicles. The concept of warehouse management system in some organization to day has not being properly implemented to gain the adequate measure of increasing customer service.

1.3 Objectives of the Study

The objective of the study is now apparent having clearly started the problems. Therefore the prime objectives are:

  1. To ascertain the reason goods are not available in some warehouse located outside.
  2. To determine the degree of effectiveness and efficiency to which warehouse management approach has been adopted in this industry.
  3. To examine the type of staff involved in the various warehouse management activities in the industry.
  4. To identify the contribution of warehouse management to profit ability of this organization as a whole.

1.4 Significance of the Study

It is imperative that the importance and validity of this research project be sufficiently stated. The importance of this research study is to provide a comprehensive and in depth study of warehouse management, exploring vast possibility through cost reduction and an avenue to identify various movement and storage at goods that have been practiced in a wrong perspective which have lead to inefficient management of storage and distribution of finished products in Unilever Plc.

Furthermore, the study will prove and suggest different methods of developing reliable suppliers of the industry in order to cut short delivery delay as a result of production stoppage. More over, it is the mind of the researcher to highlight the implication of neglecting other functional unit that are related to warehouse such as stock control, purchasing and packaging which contributes adequately towards the achievement of physical distribution objectives.

1.5 Research Questions

The research question is formulated in order to give precise direction to readers and other researchers and planners who may wish to research more on this topic and provide a base for the conclusion of this research work.

  1. What are the reasons for non-availability of goods in the outreach warehouse?
  2. What training scheme are available for warehouse management personnel?
  3. How does each warehouse function contribute to cost reduction and crease customer service in the organization?
  4. What are the possible methods to apply in developing reliable storage and distribution of goods to customers?
  5. How does transportation affects the functions of ware management.

1.6 Research Hypothesis

There are two forms of hypothesis, the null hypothesis (Ho) and the alternative hypothesis (Hi) assumption of the result of research project while the alternative denotes the positive assumption of the result.

  1. Ho: Effective warehouse management does not contribute to the profitability of the organization.
    Ho: Effective warehouse management does contribute to the profitability of the organization.
  2. Ho: warehouse management department does not ensure maintenance of goods in the warehouses.
    Ho: warehouse management department does ensure maintenance of goods in the warehouses.

1.7 Scope of the Study

This study is intended to cover Unilever Plc, Aba, particularly the warehouse department and its relationship with other functional department of physical distribution. The study embraces all the activities that are involved in the warehouse management such as, storage of goods, inventory control, distribution of finished goods, receipt and issuing, transportation of finished goods and other related activities.

The areas of emphasis includes the importance of warehouse management and it contribution to the organization. The research is supposed to cover a wide range of Nigerian organization but due to financial problem, poor response and time constraint the researcher intends to use the notable organization in Nigeria like Unilever Nigeria Plc Aba.

1.8 Limitation of the Study

While carrying out this research, the researcher was confronted with a number of limitations which includes.

1. Financial Constraint:

This played yet a great part in limiting the researchers strength. With the present state of the economy militated to a large extend to the limitation of this project work, because a lot of money is required for project exercise.

2. Dearth of Materials:

This project was also affected by in adequate material for research in libraries. This researcher could not go beyond this scope because of lack of adequate secondary data relevant to the area of study.

3. Time Constraint:

This also created much limitations to the progress of this work. The time allocated for the work was not enough, and the researcher combined course work was not enough and the researcher combined course work with this research. Time sharing therefore become difficult.

4. Inadequate Information:

As a result of the situation in the country now, some of the workers do not wish to give the necessary information needed by the researcher for fear of competitors.

1.9 Operation Definition of Terms

Individuals, association, communities, professional group attach meaning to their works according to their culture professional background. It is for this reason that the researcher make an attempt to clearly define the meaning of some terms use in the study.

1. Warehouse:

This is a large building strongly built and designed with proper security, maintenance and material handling facilities whose primary function is to store, distribute, display and handling of good in a safe condition.

2. Inventory Control:

This is the process of controlling and maintaining the level of stock, parts, work in progress and finish goods at a safe level.

3. Vehicle Scheduling and Routing:

This is the process of scheduling vehicles to match as best as customers demand for delivery of goods and proper planning of transport routes so that delivery of the required order is carried out timely with minimum delays and cost positive.

4. Receipts and Issue:

This is proper delivery of goods to various warehouse locations to enable the goods to get to the target market or final consumer.

5. Distribution:

This is proper delivery of goods to various warehouse locations to enable the goods to get to the target market or final consumer.

6. Handling Equipments:

These are the equipments used in varying goods and maintain the goods in a safe manner.

Chapter Five

Summary, Conclusion and Recommendation

5.1 Introduction

It is important to reiterate that the objective of this study was to examine the impact of effective warehouse management on the physical distribution in a manufacturing organization.

In the preceding chapter, the relevant data collected for this study were presented, critically analyzed and appropriate interpretation given. In this chapter, certain recommendations made which in the opinion of the researcher will be of benefits in examining the impact of effective warehouse management on the physical distribution in a manufacturing organization.

5.2 Summary

This study was undertaken to examine the impact of effective warehouse management on the physical distribution in a manufacturing organization. The study opened with chapter one where the statement of the problem was clearly defined. The study objectives and research hypotheses were defined and formulated respectively. The study reviewed related and relevant literatures. The chapter two gave the conceptual framework, empirical and theoretical studies. The third chapter described the methodology employed by the researcher in collecting both the primary and the secondary data. The research method employed here is the descriptive survey method. The study analyzed and presented the data collected in tables and tested the hypotheses using the chi-square statistical tool. While the fifth chapter gives the study summary and conclusion.

5.3 Conclusion and Recommendation

This study has identified some important findings for efficient warehouse management operations. A warehouse acts as a supporting function for logistics and plays a key role in attaining the overall objective of the firm’s logistical supply chain system. The performance of the warehouse is judged by its operations such as timely customer service, keeping track of items, lower operating costs, damage free delivery and higher inventory turnover.

We conclude that the effectiveness of overall operations of a company can be considerably enhanced by proper decision on objectives for efficient warehousing. Warehousing network plays a major role in the success of the physical distribution of products. In the scenario of growing competition and to meet the customer expectations for cost and service, implementation of appropriate warehousing strategies plays significant role.

The study recommends that in order to meet the customer expectations for cost and service, the organization can follow capacity switching strategy, where the capacity of a warehouse is planned on the basis of average demand per month over the year. Material handling function also has an effect on the efficiency and the speed of the warehousing operations. The materials, spare and finished goods can be moved in and out of warehouse manually or using various kinds of equipment and systems.

The efficiency of material handling process adds to the performance level of the warehouse. The reduction of labour and enhancement of productivity could be achieved by using emerging technologies in material handling. The sophisticated systems such as robotics, conveyer belt, fork lift, cranes, electric bike etc could be used in warehouses and performing other functions for speedy material movement. The bicycle manufacturing organizations’ could reframe and redesign their strategies according to their needs and requirements.

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