Unit of Measure and Bin Replenishment
This section covers the setup and maintenance of fixed or “static” bin locations, the replenishment thereof, and the use of units of measure in the bin system.
The Stream II Bin Management system allows any item to be stocked in any bin (each bin record stores a unique combination of location, bin number and item number). When the quantity on-hand in a bin drops to zero, the bin record is automatically deleted. In some cases however, it is desirable to "reserve" bin locations for specific items. Examples of this include broken case picking[1], maintaining nearby bins for fast moving items, or assigning specific bins to items requiring special handling or security.
To support this need, the zero delete field in the bin record can be set to "N". If this is done, the system flags the bin record as a reserved location. This has the following effects:
The bin record is not deleted when the quantity on hand in the bin hits zero, neither by normal processing or reconciliation programs.
The receiving program automatically considers this bin a desirable stocking location when goods are received.
The bin replenishment recommendation program considers this bin a desirable stocking location when it analyzes bin replenishment needs.
The STREAM II bin system supports the stocking of goods in units of measure other than each (EA). The following table (based on the Gencode table BINUOM) shows the units of measure support in STREAM II, using pencils as an example
|
Unit of Measure |
UOM Code |
Number of units in packaging unit |
|
Each |
EA |
1 pencil |
|
Pack |
PK |
10 |
|
Carton |
CR |
100 |
|
Case |
CA |
1000 |
|
Pallet |
PL |
24000 |
|
Truck |
TK |
960000 |
The numbers of individual units contained in a unit of packaging are stored in the inventory record for the SKU, on the materials panel. Each value is the number of individual units in the packaging unit. In the above example the Case field in the inventory record would contain 1000 to indicate that there are 1000 items in a case.
Stream II allows you to inventory different units of measure of a product either under the same SKU or under different SKUs. In the case of pencils, an individual pencil may have a SKU while the large units of measure may or may not have different SKUs. The following explains the pros and cons of the two methods. Both methods can be used in conjunction with each other.
Same SKU Scenario
In this situation, all pencils are stored under the same SKU, i.e. one inventory record per warehouse location. This inventory record contains the total number of pencils on hand. Within the bin system, each bin location record (Location/Bin/SKU) contains the number of pencils in the bin and the unit of measure code. If a bin contains 500 pencils packaged as cartons the quantity in the bin is 500 and the unit of measure code is CR (cartons).
As the result of organizing your inventory this way all lookup screens and inventory records show the total quantity of an item on hand in individual units in one place.
Different SKU Scenario
In this situation, pencils are stored under different SKUs based on the packaging unit. In this case, multiple inventory records are maintained per warehouse location, one for each packaging unit that pencils are stored in (Each, Carton, Case). Each inventory record contains the total number of each type of packaging units on hand. The inventory record for the individual pencils shows how many individual pencils you have in stock; the inventory record for the SKU for cases of pencils shows the number of cases you have in stock, and so forth.
To determine the total number of pencils in stock, you would calculate the number of packaging units times the number of items in each packaging unit and total them. Note: Under this scenario there is nowhere in the system where a single number is stored that represents the total number of pencils in stock. This may not matter to a distributor that does not change packaging units of measure as each packaging unit is treated as a different product, but it is very important to understand.
Within the bin system, each bin location record (Location/Bin/SKU) contains the number of “eaches” in the bin and the unit of measure code which describes the packaging. If a bin contains 500 pencils, packaged in cartons of 10, the quantity in the bin is 50.
This type of SKU organization is common in the office supply business where each different packaging unit of measure has an industry standard SKU.
Bin Replenishment
On a periodic basis, the operator selects the recommend bin replenishment option of inventory transfer program. The system reviews all active static bin locations to see if they need to be refilled.
To determine if a bin needs to be refilled the system subtracts the qty on hand from the max_qty (the maximum number of items that should be in the bin) to determine the quantity to replenish. If the quantity to replenish is more than 50% of the max_qty, and is greater than the quantity of units in the next unit of measure packaging, the system reports the bin as needing replenishment.
The basis for the logic above is: do not replenish if the bin is more than half full, i.e. if there is room for 10 cases of a product in the bin and there is only room to replenish one case do not call for replenishment. The rest of the logic is to not replenish unless you can move at least one packaging unit of the next packaging unit up to the bin.
This means that static bins need to be sized to be able to accept at least one full unit of the higher sized packaging unit; i.e. a static bin location for broken case picking of individual units must be at least big enough to accept the contents of a full carton of the goods.
When the replenishment suggestion process runs it does the following:
1, The bin file is scanned looking for active static bins as only static bins are processed.
2. When an active static bin record is found the system calculates the "qty to replenish" for the bin.
3. The system then checks for bins with the same SKU, with the same or greater unit of measure to determine if goods are available to replenish the bin being processed. Only active non-static bins are considered to replenish from.
4. If there are not goods available with the same SKU to replenish with the system scans the cross reference file to find alternate unit of measure SKU records. These are type "U" records in the CrossRef file. The item_no field contains the individual item number, the alt_item_no contains the SKU of the items other packaging unit of measure, and the conversion_ratio field contain the ratio of item_no to alt_item_no.
5. If goods are available to replenish it makes the recommendation to replenish the bin. The system is smart enough to recommend replenishment intelligently. This means that it will first recommend replenishing with the same unit of measure from non-static bins, and will also recommend replenishing with the largest unit of measure that will fit in the "room to replenish", i.e. if there are cartons and cases available it will first try to replenish with a case.
As the replenishment process creates replenishment suggestions it is committing inventory in the bins that is is suggesting the goods be pulled from.
The transfer suggestions are stored as records in the PICK file. They contain both the source and the destination location, bin and item number. Once the replenishment recommendations have been created they may be processed either manually or using an RF device.
Manual Replenishment Processing
This procedure allows all replenishment processing to be done using a desktop workstation without any use of RF devices. The operator prints a report of the replenishment suggestions - PICK lines status = O and type = R. The report prints a bar code of the ticket and line number of each transfer suggestion next to the suggestion.
To complete the transfer the operator loads the replenishment completion program, then scans each of the transfers that has been completed. The system then executes the transfer, writing inventory and warehouse transactions as it does so. The inventory transaction is required in cases where an item is being exploded (ie. case to each conversion) to an item with a different number (and cost). The value of the Note: As long as replenishment transfer suggestions records are in the pick file for a warehouse location the replenishment recommendation program can not be run for that location.
RF Replenishment Processing
After the replenishment recommendation process is run transfer suggestions are available for processing. At this point RF users can invoke the RBT program on their devices. The RBT program will then select a user defined number of suggested transfers and instruct the user to pick up the goods and then direct them to the bin locations to drop the goods off at. Once the goods are dropped off the transfer suggestions are cleared.
Item and Unit of Measure Setup Examples
To clarify the relationship between SKU and unit of measure the following example are provided for clarification.
All pencils under one SKU, total of 91,350 pencils on hand
Inventory Master
Item Number PNC1
Unit of Measure EA (each)
Quantity on Hand 91,350
Pack 5
Carton 100
Case 2,000
Pallet 40,000
Bin Record with 250 loose pencils in it
Item Number PNC1
Unit of Measure EA (each)
Quantity 250
Bin Record with 20 packs (5 per pack), for a total of 100 pencils, in it.
Item Number PNC1
Unit of Measure PK (pack)
Quantity 100
Bin Record containing 10 cartons of 100 pencils each, for a total of 1000 pencils.
Item Number PNC1
Unit of Measure CR (carton)
Quantity 1,000
Bin Record containing 5 cases of 2,00 pencils each, for a total of 10,000 pencils.
Item Number PNC1
Unit of Measure CS (case)
Quantity 10,000
Bin Record containing 2 pallets of 40,000 pencils each, for a total of 80,000 pencils.
Item Number PNC1
Unit of Measure PL (pallet)
Quantity 80,000
Pencils under multiple SKUs based on Unit of Measure.
Individual Pencils - 250 pencils on-hand as loose pencils
Inventory Master
Item Number PNC1
Unit of Measure EA (each)
Quantity on Hand 250
Pack 5
Carton 100
Case 2,000
Pallet 40,000
Bin Record with 250 loose pencils in it
Item Number PNC1
Unit of Measure EA (each)
Quantity 250
Packs of Pencils - 500 pencils on-hand in packs of 5
Inventory Master
Item Number PNC2-PK
Unit of Measure PK (Pack of 5 pencils)
Quantity on Hand 100
Carton 20
Case 400
Pallet 8,000
Bin Record with 20 packs (5 per pack), for a total of 100 pencils.
Item Number PNC2-PK
Unit of Measure PK (pack)
Quantity 20
Cartons of Pencils - 2,000 on-hand in cases of 100
Inventory Master
Item Number PNC3-CR
Unit of Measure CR (Carton of 100 pencils)
Quantity on Hand 20
Case 20
Pallet 400
Bin Record containing 20 cartons of 100 pencils each, for a total of 2000 pencils.
Item Number PNC3-CR
Unit of Measure CR (carton)
Quantity 20
Cases of Pencils - 30,000 on hand n cases of 2,000
Inventory Master
Item Number PNC4-CS
Unit of Measure CS (Case of 2,000 pencils)
Quantity on Hand 15
Pallet 20
Bin Record containing 15 cases of 2,000 pencils each, for a total of 30,000 pencils.
Item Number PNC4-CS
Unit of Measure CS (case)
Quantity 15
Pallet of Pencils - 80,000 on hand in pallets of 40,000
Inventory Master
Item Number PNC5-PL
Unit of Measure PL (Pallet of 40,000 pencils)
Quantity on Hand 2
Truck 20
Bin Record containing 2 pallets of 40,000 pencils each, for a total of 80,000 pencils.
Item Number PNC5-PL
Unit of Measure PL (pallet)
Quantity 2
More:
SKU Conversion