Two types of warehouses in production processes

The key functions of production warehouses

Even in times of lean production lines and just-in-time systems, production warehouses still have an important role to play. They can still perform critical functions that have a positive effect on a company’s success. Particularly in sectors with strong seasonal business, company goals can frequently be met with the help of production warehouses.

Production- and sales-focused production warehouses

There are two types of warehouses in the manufacturing process: production and sales-focused warehouses. Semi-finished products are stored in production-oriented warehouses. These warehouses are created, in particular, as a result of insufficient synchronization between successive production processes. Finished parts or component groups are located in sales-focused production warehouses. Such warehouses are created as the result of strategic production decisions concerning whether and to what extent parts for order-related, finished products should be produced and temporarily stored before an order is received.
In addition, the different types of warehouses fulfill different functions. Production-focused warehouses perform a balancing, sorting and security function. Sales-focused warehouses fulfill a flexibility, delivery-time-reducing and substitution function [1].

Functions of production-focused production warehouses

Balancing function

A completely synchronized production process would be ideal. In reality, various production lines frequently cannot run at the same speed. As a result, a linkage buffer between two production units in a production process performs a counterbalancing function to coordinate the input and output of several production units with one another [1].

Sorting function

The sorting function is carried out by a material-planning buffer. A typical example of a material-planning buffer is the intermediate-storage facility that is used before and after the paint shop: To avoid changing colors as much as possible, parts are sent through the paint shop in groups to be painted the same color. The lots are split up, combined and put in a new sequence. Once they have gone through the paint shop, they are resorted so that they can be delivered to suit assembly needs [2]. The sorting function is provided by the option of changing the order of objects moving to and from the warehouse and of grouping or segmenting lots.

Security function

When a disruption occurs in the manufacturing facility, production can be secured in other production units through the use of a material-planning buffer. In this manner, this disruption buffer performs a security function [1].

Functions of sales-focused production warehouses

Flexibility function

The sales-focused production warehouse carries out a flexibility function when many end products can be made from a relatively small number of intermediate products or from a single raw product to respond to the requests of individual customers. In T-shirt production, for instance, manufacturers make only white T-shirts. These shirts are stored. Later, they are dyed or have an emblem added to them depending on the latest design requirements [1].

Delivery-time reduction function

Frequently, people assume that many automakers only manufacture cars based on individual customer requests or orders. Actually, production of the requested car begins before the order arrives. Otherwise, the delivery time Delivery time would take too long. As a result, warehouse inventories perform an acceleration function in the production process. The warehouse is used to store intermediate products, and these products only have to be assembled, completed or modified depending on feature options [1].

Substitution function

The storage of finished goods can be replaced by the storage of semi-finished goods. Semi-finished goods like white T-shirts or car bodies come in considerably fewer variations than finished goods. As a result of the reduced variety of the products being stored, much less capital is tied up. At the same time, warehouse space can be saved because, in general, semi-finished goods can be stored more easily and compactly. In this manner, the sales-oriented production warehouse performs a substitution function [1].

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