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

Scenario Overview 1 Purpose and Benefits: Purpose Benefits 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 flows covered Goods Receipt Processing Return Deliveries Internal Warehouse Replenishment Goods Issue Processing Warehouse Physical Inventory Tools and Workbenches

Scenario Overview 2 SAP Applications Required: Required SAP EHP3 for SAP ERP 6.0 Company roles involved in process flows Retail Warehouse Clerk Retail Sales Person Retail Warehouse Manager

Process Flow Diagram Retail Warehouse Clerk Retail Sales Person 4.1.1.1 Create Purchase Order for Single Article 4.1.1.2 Create Purchase Order for Generic Article 4.1.2 Create Inbound Delivery 4.1.3 Appointment Planing 4.2 Receipt of incoming Goods 4.2.1 Post Rough Goods Receipt 4.2.2 Enter an Actual Appointment 5.1.3.1 Issuing the Article Document as Goods Issue / Receipt Slip 5.1.2 Create a Return Delivery 5.1.1 Search for the Article Document for Goods Receipt 4.4.2.2 Log-on to the Terminal Alternative 1: Confirm without difference 4.4.1 Alternative 1: Asynchronous Warehouse Management 4.3 Put away Preparation 5.1.3.2 Create a Transfer Order in the Warehouse Alternative 2: Confirm with difference 5.1.4 Goods Collection 6.1 Replenishment Planning 6.2.1 Create a Transfer Order 6.2.2 Confirm Transfer Order 7.1 Create an Outbound Delivery Retail Sales Person 4.2.3 Goods Receipt with Reference to the Rough Goods Receipt Retail Warehouse Manager 4.4.2.3 Putaway Processing 4.4.2.1 Ressource Planning with the RF Monitor

Process Flow Diagram Retail Warehouse Clerk Retail Warehouse Manager Alternative 1: Confirm without difference 7.2.2.2.1 Resource Planning in the Monitor for Mobile Data Entry 7.2.2.2.2 Log-on to the Terminal 7.2.2.2.4 Monitor from Mobile Data Entry Monitor 7.3 Post Goods Issue 7.2.1 Create Transfer Order as a Picking Document 7.2.2.1 Alternative 1: Asynchronous Warehouse Management Alternative 2: Confirm with difference 7.4.5 Subsequent Delivery Split 7.4.4 Confirm Transfer Orders in Collective Processing 7.4.3 Create Transfer Orders in Collective Processing 7.4.2.1 Alternative 1: Automatic Capacity-Driven Creation of Wave Picks 7.4.2 Creating Wave Picks 7.4.1.1 Alternative 1: Manual Creation 7.4.1 Create Deliveries with Planned Picking Time 7.4.6 Goods Issue in Collective Processing 8.2.2 Trigger Inventory Recount 7.4.2.2 Alternative 2: Creating Wave Picks Manually 8.1 Create a Physical Inventory Document 8.2.1 Manual Entry 8.2.3 Carry Out Inventory Recount 8.3.1 Post Differences in Warehouse Management 8.3.2 Post Differences in Inventory Management 8.4.1 Difference Statistics 8.4.2 Determine Inventory Status 9.3 Wave Pick Monitor 9.2 Outbound Delivery Monitor 9.1 Warehouse Activity Monitor Retail Warehouse Manager 9.4.2 Rough Workload Estimate After Goods Issue 9.4.1 Rough Workload Estimate After Creation of Outbound Deliveries

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

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 Whse number Inventory Management on bin level Putaway / Picking strategies are used Storage bin is master data and can be determined by strategy (other than fixed) Storage type Storage section W M Storage bin

Warehouse Structure - Warehouse PC1 Gate 1 2 Gate 2 H01 High Rack Storage Random Storage Section 001 Fast moving items Section 002 Slow moving items GR-Area H01 / B01 / F01 Storage for Special Goods (depending on master data) Section 001 Total Section K01 Picking storage type Fixed storage bins Section 001 Fast moving items Section 002 Slow moving items GI-Area 3 Gate 3 4 Gate 4

Storage Bins - Warehouse PC1 Gate 1 2 Gate 2 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 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 GI-Area 3 Gate 3 4 Gate 4

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

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

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)

Stock check – Triggering Replenishment Reserve storage Stock in bin smaller than minimum quantity? Trigger replenishment Transfer request is generated Create Transfer Order Picking Zone Physical Goods Transport Confirm Transfer Order

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

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

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

Mass Processing of Deliveries Group of Outbound Deliveries or Wave Pick Delivery Manual creation in the outbound delivery monitor using selection by: Shipping point Picking date Route, carrier ... Free selection 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 ...) Delivery Considering capacity restrictions: Weight, volume Maximum items on the picking list Working time ...

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

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

Rough Workload Estimate Planned Goods Issue Delivery 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

User interface SAPGui SAPConsole Mobile Data Entry in WM 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 R/3 Application Online processing User interface SAPGui SAPConsole

Controlling the Warehouse via RF-Monitor RF-Monitor of the warehouse manager transfer orders run into workload queues The warehouse employees are assigned the 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.

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

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

Processes Goods Receipt and Return Deliveries

Processes Replenishment and Goods Issue

Process Variant Mass Processing of Deliveries

Process Warehouse Physical Inventory

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