Usefulness & Constraints

USEFULNESS
1) Improving the efficiency and effectiveness of WH and DC

Having more awareness about the future trends would significantly reduce potential bottleneck operations. In addition, the challenges faced made us realized that it is essential that a warehouse/DC must keep its overall operating costs at its minimum as the cost of transportation would continue to increase due to the rising price of oil. Furthermore, the stock taking accuracy and efficiency would improve due to use of softwares and computer systems. Thus, learning the trends and challenges would aid greatly in the improvement of the warehouse/DC. In addition, technology such as CCTV camera would greatly enhance security and protection of goods. All in all, these are helping the warehouses/DC to run as smoothly and efficiency as possible.


2) Technology is a vital and useful tool

We learnt that technological advancements would enable a Warehouse/DC to gain competitive advantages over rivals. Furthermore, technology such as RFID and barcodes would improve the identifications and storages of goods in the WH/DC. Less time is required to find the items and the items are easily accounted for, thus reducing theft and pilferages. The time taken to move the goods around the Warehouse/DC would also be considerably reduced due to the use of conveyors and automated guided vehicle (AGV). Lastly, accessibility of goods could be improved with the use of AS/RS system.

Therefore, it is fundamental that we should keep up with technological advancements by constantly upgrading our machines and computer systems, as well as sending workers for upgrading course to improve on their technical skills and abilities.


3) Improving customer satisfaction

Keeping your customer satisfied is the key to success and customer satisfaction is one area that will either kill or excel your business. From our research, we learnt that consumers nowadays are unwilling to wait and therefore lead time must be shortened in order to maximize customer satisfaction. Although technological advancements enables the reduction of customer waiting time, it is crucial that a warehouse/DC should strike the right balance between reducing the waiting time of customers and achieving low sustainable operating cost. Consequently, learning the trends and challenges of warehouse/DC would allow us to have a thorough understanding of what customers really want.



CONSTRAINTS
1) Advancements in Technology can be a hurdle too

Workers must be able to operate the high technological equipments in order to keep up with the changing technology. If the workers are unable to operate the equipments, it may slow down the movement and flow of goods, leading to a decrease in efficiency and effectiveness of the warehouse/DC. Technological equipments are prone to breakdowns - when a breakdown occurs, it will affect the processes of the warehouse/ distribution centres. Therefore, the workers must know what to do which most of the time requires technological knowledge. Hence, when hiring workers, companies when hire workers with technological knowledge, it may also cost more.


2) High Cost

Cost has been increasing with the rising trends. For example, transportation cost. With the increase cost of fuel, it will affect the modes of transportation especially transportation by air-freight, which is an increasing trend. In addition, the trends of globalisation and the different modes of transportation for goods in which customers require would increase the transportation cost further. Customers’ satisfaction is especially important since they have no/little tolerance for errors. Therefore, more time is required for expediting, checking for the accuracy of customer orders with the purpose of ensuring the 3’R’s (Right place, Right time and Right quantity); Doing these, will lead to an increase in administrative cost from expediting, checking for accuracy, providing value added services and to also reconfirming it with the customers. This would not only increase customer satisfaction, but also increase the total cost.


3) High Capital Investment

Although the trend of using high technological equipments enhances the effectiveness and efficiency, it is expensive to implement and requires large amount of capital. Examples of high technological equipments include RFID (Radio Frequency Identification), AS/RS, live storage, conveyor belts etc. These systems and equipments need necessary installation, implementation and maintenance as they are prone to breakdowns, which will affect the management, movement of goods and process in the warehouse/distribution centres. Therefore it is essential to have regular maintenance and services. However, more will have to be spent for this cause.