Warehouse and DC Management (WM)

1. Warehouse and DC Management (WM) SAP Best Practices for Retail

2. Purpose, Benefits, and Key Process Steps • Purpose • This scenario describes the processing procedure for retail goods in a distribution center, using a warehouse management system with inventory management at storage bin level. In this scenario, distribution center will refer to a warehouse that is supplied by vendors, that stores the merchandise and then prepares it to be shipped to customers or stores. • Benefits • As warehouse processes depend greatly on the amount of space available, the organization of the warehouse and the merchandise stored there, this scenario should be viewed simply as an example for implementation purposes. However, with very little effort, this example can be adapted to fit any customer-specific situation. • Key Process Steps • Goods Receipt Processing • Return Deliveries • Internal Warehouse Replenishment • Goods Issue Processing • Warehouse Physical Inventory • Tools and Workbenches

3. Required SAP Applications and Company Roles • Required SAP Applications • SAP SAP enhancement package 5 for SAP ERP 6.0 • Company Roles • Retail Warehouse Specialist

4. Process Flow Diagram Warehouse and DC Management (WM) Retail Warehouse Specialist Create Purchase Order for Single Article Create Purchase Order for Generic Article Create Inbound Delivery Appointment Planing Receipt of incoming Goods Post Rough Goods Receipt Enter an Actual Appointment Create a Return Delivery Search for the Article Document for Goods Receipt Log-on to the Terminal Alternative 1: Confirm without difference Alternative 1: Asynchronous Warehouse Management Put away Preparation Issuing the Article Document as Goods Issue / Receipt Slip Create a Transfer Order in the Warehouse Alternative 2: Confirm with difference Create a Transfer Order Confirm Transfer Order Create an Outbound Delivery Goods Collection Replenishment Planning Putaway Processing Ressource Planning with the RF Monitor Goods Receipt with Reference to the Rough Goods Receipt

5. Process Flow Diagram Warehouse and DC Management (WM) Retail Warehouse Specialist Alternative 1: Confirm without difference Resource Planning in the Monitor for Mobile Data Entry Log-on to the Terminal Monitor from Mobile Data Entry Monitor Post Goods Issue Create Transfer Order as a Picking Document Alternative 1: Asynchronous Warehouse Management Alternative 2: Confirm with difference Subsequent Delivery Split Confirm Transfer Orders in Collective Processing Create Transfer Orders in Collective Processing Alternative 1: Automatic Capacity-Driven Creation of Wave Picks Creating Wave Picks 7.4.1.1 Alternative 1: Manual Creation Create Deliveries with Planned Picking Time Goods Issue in Collective Processing Trigger Inventory Recount Alternative 2: Creating Wave Picks Manually Create a Physical Inventory Document Manual Entry Carry Out Inventory Recount Post Differences in Warehouse Management Post Differences in Inventory Management Difference Statistics Determine Inventory Status Wave Pick Monitor Outbound Delivery Monitor Warehouse Activity Monitor Rough Workload Estimate After Goods Issue Rough Workload Estimate After Creation of Outbound Deliveries

6. Outb. Del. PO Inb. Delivery Rough GR Document Flow in the Warehouse W M IM GR Area PUTAWAY TRANSFER ORDER GOODS RECEIPT WAREHOUSE PICKING TRANSFER ORDER Shipping Area GOODS ISSUE

7. Inventory Management - IM vs. WM Inventory Management on article level Fixed storage bin can be maintained in the article master (text field) IM Site Storage Location Inventory Management on bin level Putaway / Picking strategies are used Storage bin is master data and can be determined by strategy (other than fixed) Whse number Storage type Storage section W M Storage bin

8. Gate 1 Gate 2 2 1 Section 002 Slow moving items H01 High Rack Storage Random Storage Section 001 Fast moving items H01 / B01 / F01 Storage for Special Goods (depending on master data) Section 001 Total Section Section 002 Slow moving items Section 001 Fast moving items 3 4 Gate 3 Gate 4 Warehouse Structure - Warehouse PC1 GR-Area K01Picking storage type Fixed storage bins GI-Area

9. Gate 1 Gate 2 1 2 21 aisles, each with 50 bins Bins 01-20 Fast moving, Bins 21-50 Slow moving Aisles 01-07 Picking Area 001 Aisles 08-14 Picking Area 002 Aisles 15-21 Picking Area 003 Bins KOM-01-001 to KOM21-050 3 4 Gate 3 Gate 4 Storage Bins - Warehouse PC1 GR-Area 10 Aisles, 10 Stacks, 10 Levels Level 01 - 04 Fast moving items Level 05 - 10 Slow moving items Bins 01-01-01 to 10-10-10 5 aisles,25 bins each All Storage bins in Total Section Bins 01-001 to 05-025 GI-Area

10. GI Document Quant in the GR-Area of the Warehouse Putaway – Post Goods Receipt • Goods Receipt • Movement type • Article • Quantity • Site • Stor. location WM Warehouse Transfer Requirement

11. Putaway(physical movement) Create Transfer Order Automatical determination of storage bins Transfer Order Putaway – Transfer Order Transfer Requirement Quant Confirm Transfer Order Confirm storage bin and quantity

12. Warehouse Data in the Article Master Article Master Data Warehouse Management • Warehouse number (PC1) • Storage type (K01) • Picking storage type (K01) • Storage bin (KOM-04-003) • Maximum bin quantity (50) • Minimum bin quantity (10) • Rounding quantity (blank) • Control quantity (blank) • Replenishment qty. (blank)

13. Reserve storage Stock check – Triggering Replenishment Stock in bin smaller than minimum quantity? Triggerreplenishment Transfer request is generated Picking Zone Create Transfer Order Physical Goods Transport ConfirmTransfer Order

14. Goods Issue Delivery ! Delivery is relevant for picking Transfer order required ! Picking – Delivery • Delivery • Article • Quantity • Site • Stor. Location WM Warehouse

15. Create Transfer Order Automatical determination of storage bins Picking(physical movement) Picking List Transfer Order Delivery Quant In the shipping zone Picking – Transfer Order Quant Picking Storage Type Confirm Transfer Order Confirm Picking Quantity

16. Goods Issue GoodsIssue Delivery ! Delivery is relevant for picking Transfer order required ! Picking – Goods Issue • Delivery • Article • Quantity • Site • Stor. Location WM Warehouse Picking is finished

17. Manual creation in the outbound delivery monitor using selection by: • Shipping point • Picking date • Route, carrier ... • Free selection Delivery Delivery Delivery Delivery Delivery Delivery Delivery • Automatic generation using selection by: • Picking date / time • Additional filter by several criteria (e.g. route, shipping point, ship-to-party ...) Group of Outbound Deliveries or Wave Pick • Considering capacity restrictions: • Weight, volume • Maximum items on the picking list • Working time • ... Mass Processing of Deliveries

18. Collective Follow-On-Processing: • Create transfer order • Confirm transfer order • Post goods issue Delivery Delivery Delivery Delivery Delivery Delivery Delivery Group of Outbound Deliveries or Wave Pick Mass Processing of Deliveries

19. Warehouse Activity Monitor • List of all processes within a critical timeframe for execution: • Unconfirmed transfer orders • Open transfer requirements • Critical deliveries • ... Direct follow-on-processing of the critical documents List of all critical documents

20. Planned Goods Issue Delivery Delivery Delivery Delivery Delivery Rough Workload Estimate • Calculation of • workload using: • Logistics Load Category • Unit of Measure • Whse no. / storage type • Warehouse process • Estimated Workload in: • Quantity • Weight • Volume • Execution time • Information on: • needed manpower • needed transport • capacity

21. Mobile Data Entry: • Mobile terminals in a radio frequency network • Robust hardware made for use in the warehouse • Built-in barcode scanner • Touch screen for easy use • Simplified SAPGui (SAPConsole) as user interface Mobile Data Entry in WM R/3 Application Online processing User interface SAPGuiSAPConsole

22. Controlling the Warehouse via RF-Monitor RF-Monitor of the warehouse manager • transfer orders run into workload queues • The warehouse employees are assigned these queues and thus a workload of TOs. • The overload of a queue can be avoided by monitoring the displayed TOs/employee relation. Transfer Orders Touch screen of the warehouse employee The system provides the warehouse employees with transfer orders from their queue continuously.

23. Continuous Physical Inventory Physical Inventory with WM Create Physical InventoryDocument Activate Physical Inventory Document Block storage bins Print / ReleaseCount List Count, Weigh, Measure, Estimate Record Inventory Count Results ProcessDifference List Initialize Recount Inventory Difference Clear differences in Warehouse Management Clear differences in Inventory Management Unblock storage bins

24. Benefits of Continuous Physical Inventory Better distribution of workload in the warehouse The inventory can be carried out in periods with lower workload Periodic Inventories are usually time consuming and labour intensive Up-to-date information on the availability of the stock in the warehouse The cost of the inventory can be reduced by planning it carefully

25. Processes Goods Receipt and Return Deliveries

26. Processes Replenishment and Goods Issue

27. Process Variant Mass Processing of Deliveries

28. Process Warehouse Physical Inventory