Warehouse Management: Receiving & Storage

Warehouse management generally covers four key processes: Receiving, Storage, Dispatching and Stock–taking. Below focuses on Receiving and Storage.

Receiving

Six Non–Acceptance Rules

1. Goods delivery note exists without physical goods: no warehousing procedure shall be performed.
2. Physical goods exist without original delivery note or invoice: no warehousing procedure shall be performed.
3. Mismatch of quantity, specification or model between delivered goods and delivery note: no warehousing procedure shall be performed.
4. Goods failing IQC inspection without signed approval from management: no warehousing procedure shall be performed.
5. Goods issued for collection prior to completion of warehousing formalities: no warehousing procedure shall be performed.
6. Non-original delivery note or invoice: no warehousing procedure shall be performed.

Four Principles of Inbound Inspection

1. Consistency between documents
2. Consistency between documents and physical goods
3. Strict quality control
4. Complete documentation

Eight–step Inbound Inspection Procedure

1. Verify supplier information
2. Confirm delivery date
3. Confirm product name and specifications
4. Confirm quantity and quality
5. Notify inspection results
6. Return non-conforming goods
7. Complete timely warehousing
8. Keep detailed records

Storage

1. Fixed Bin Location Principle

Each material shall be assigned to a fixed storage bin. Physical bin locations must match records in the ERP system. A bin location code works like a residential address. Without fixed bin locations, materials cannot be located efficiently.

2. Dedicated–use Principle

Materials allocated for specific orders shall not be arbitrarily diverted for other purposes.

3. ABC Inventory Management Principle

• Class A: Accounts for 10-15% of total inventory quantity, contributing 60-70% of total inventory value.
• Class B: Accounts for 20-35% of total inventory quantity, contributing 15-20% of total inventory value.
• Class C: Accounts for 50-70% of total inventory quantity, contributing 5-10% of total inventory value.

Prioritize tight control over the critical few (Class A & B), rather than the trivial majority (Class C).

4. Old–for–new Replacement Principle

For designated materials, new-item collection is permitted only upon return of old items.

5. Warehouse Access Control Rules

1. Except warehouse and handling staff on duty, no unauthorized personnel may enter the warehouse.
2. No personnel shall carry materials in or out of the warehouse without authorization.
3. Visitors may enter the warehouse only when accompanied by supervisors or higher-level management.

6. Complete Daily Tasks for Daily Improvement

1. At the end of each working day, warehouse staff shall self-reconcile physical inventory against system records, identify discrepancies and make timely improvements.
2. Patrol assigned storage zones at least 1-2 times per day. Ensure proper condition, safety and 6-S compliance of stored materials with correct labels. Return defective goods to suppliers or move them to the return area to avoid slow-moving inventory.
3. Warehouse documents shall be submitted to data entry clerks on the same working day; data entry shall also be completed on the same day.

7. Six Principles for Material Placement

1. Face-the-aisle placement: facilitate material handling and picking.
2. First-in, first-out (FIFO): prevent deterioration and loss from long-term storage.
3. Turnover-based positioning: assign storage locations according to inbound & outbound frequency.
4. Group similar items: store identical or similar materials in adjacent zones for easy picking and identification.
5. Weight- and dimension-adapted storage: ensure safe and convenient handling operations.
6. Five-unit stacking: arrange goods in groups of five (rows, squares, packs, piles or layers) for easy counting and stock-taking.

8. Three Preventive Measures

Fire prevention, water damage prevention and theft prevention.