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NIOS Class 10 Warehouse Principles & Inventory Management Chapter 1 Basic Concepts of Warehouse
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Basic Concepts of Warehouse
Chapter: 1
Intext Questions 1.1
(i) Stored goods in the warehouse include………..
(a) Raw material.
(b) Packing material.
(c) Finished goods.
(d) All the above.
Ans: (d) All the above.
(ii) In India, a warehouse may be referred as __________
Ans: Godowns.
(iii) Which of the following are the reasons for the necessity of a warehouse?
(a) Seasonal production.
(b) Quick supply.
(c) Price Stabilisation.
(d) All the above.
Ans: (d) All the above.
(iv) The person in-charge of warehouse is called ______
Ans: Warehouse – keeper.
(v) According to _______________________warehouse is “a planned space for the efficient storage and handling of goods and materials” that will be sold and distributed later.
Ans: Logistics bureau.
Intext Questions 1.2
(i) Warehouses are designed depending upon the _______________to be stored.
Ans: Nature of the products.
(ii) The act of storage of goods until they are needed is ——————
Ans: Warehousing.
(iii) Define Warehousing?
Ans: The activities involve storage of goods in a systematic and orderly manner and maintaining and making them available conveniently when needed.
(iv) Warehousing bridges that gap by storing goods between production and consumption and further creates time utility (True/False)
Ans: True.
Intext Questions 1.3
(i) Warehouses provide a _______________ location for your goods, making it easier to track and manage your inventory.
Ans: Centralised.
(ii) Warehouses reduce the risk of theft and damage of products (True/False).
Ans: True.
(iii) Warehouses enable organisations to increase the wastage in terms of space and labour hours and assure more efficient inventory utilisation (True/False).
Ans: False.
(iv) Warehouses help in ________________ productivity and _______________the overall cost.
Ans: Increase and decrease.
Intext Questions 1.4
(i) Mention any two objectives of the warehouse.
Ans: (a) Efficient Accessibility.
(b) Increased turnover.
(ii) Maximising effective use of space is one of the objectives of warehousing (True/ False)
Ans: True.
(iii) The stock of the raw materials to enable _______________.
Ans: Continuous production process.
(iv) The stock of the finished products to enable ________________.
Ans: Planned distribution and sale.
Intext Questions 1.5
(i) What is the full form of FIFO?
Ans: First in First Out.
(ii) What are the two sets of operations controlled by the Warehouse Management System?
Ans: (a) On the inventory front (b) On the operations front.
(iii) Expand KPI.
Ans: Key Performance Indicators.
(iv) What is a stock keeping unit?
Ans: A stock keeping unit or SKU is a scannable barcode in which a number is assigned to a product for the purpose of inventory management and ease of tracking.
(v) List out the warehouse management process?
Ans: Receiving, Put-away, Storage, Picking, Packing, Shipping.
| Terminal Exercise |
1. Define Warehouse?
Ans: Warehouse is a commercial building used by business entities like manufacturers, traders, importers and exporters to store materials either be finished goods, raw materials, packaging material and spare parts till they are reshipped for sale or consumption or taken for distribution to retailers.
2. What is meant by Warehousing?
Ans: A warehouse is a building or a structure for storing cargos. Warehouses are used by producer’s consignees, consignors, transport businesses, customs, etc. Stored goods can include any raw materials, packing materials, components, or finished goods associated with agriculture, manufacturing and production. In India, a warehouse may be referred to as a “godown”.
3. What is SKU?
Ans: A stock keeping unit or SKU is a scannable bar code in which a number is assigned to a product for the purpose of inventory management and ease of tracking.
4. What is the difference between warehouse and warehousing?
Ans:
| Warehouse | Warehousing |
| Warehouse is a place where goods are stored for future use. | The activities involve storage of goods in a systematic and orderly manner and maintaining and making them available conveniently when needed. |
5. What is the need for a warehouse?
Ans: Warehousing is necessary due to the following reasons:
(i) Seasonal Production: You know that agricultural commodities are harvested during certain seasons, but their consumption takes place throughout the year. Therefore, there is a need for proper storage for these commodities. Warehouses offer the facilities to store and maintain these commodities from where they can be taken for consumption as and when required.
(ii) Seasonal Demand: There are certain goods, which are demanded seasonally, like woollen garments in winters or umbrellas in the rainy season. The production of these goods takes place throughout the year to meet the seasonal demand. So there is a need to store these goods in a warehouse to make them available at the time of need.
(iii) Large-scale Production: In the case of manufactured goods, now-a-days production takes place to meet the existing as well as future demand of the products. Manufacturers also produce goods in huge quantities to enjoy the benefits of large scale production, which is more economical. So the finished products, which are produced on a large scale, need to be stored properly till they are cleared by sales.
(iv) Quick Supply (Distribution): Both industrial as well as agricultural goods are produced at some specific places but consumed throughout the country. Therefore, it is essential to stock these goods near the place of consumption, so that without making any delay these goods are made available to the consumers at the time of their need.
(v) Continuous Production: Continuous production of goods in factories requires adequate supply of raw materials. So there is a need to keep sufficient quantities of raw material in the warehouse to ensure continuous production.
(vi) Price Stabilisation: To maintain a reasonable level of the price of the goods in the market, there is a need to keep sufficient stock in the warehouses. Scarcity in supply of goods may increase their price in the market. Again, excess production and supply may also lead to fall in prices of the product. Warehousing leads to price stabilisation by maintaining a balance of supply of goods.
6. Mention any four points of the importance of the warehouse.
Ans: Following are the impedance of the warehouse:
(i) Enable the storage of raw material, finished goods, semi-finished goods, goods in transit, seasonal goods, etc.
(ii) Enable the efficient distribution of goods; for example, storage of crops after harvesting to distribution in the areas where they are processed or to places where there are shortages.
(iv) Ensure stable prices, as stored output can be used during the time of low production.
(v) Enable grading and picking of goods.
7. Write about the sets of operations controlled by the Warehouse Management System.
Ans: The Warehouse Management System controls two sets of operations:
(i) On the inventory front: The system maintains inventory in the warehouse at zone & individual location level, Stock keeping Units (SKU) level, pallet wise, carton wise and unit level inventories for multiple customers and allows specific inventory attributes and parameters to be built in to manage, allocate or block the inventory. The system also provides options to adapt First in First out (FIFO), Last in First out (LIFO) or other methods of inventory flow.
(a) First-in, first-out (FIFO) assumes the oldest inventory will be the first sold. It is the most common inventory accounting method.
(b) Last-in, first-out (LIFO) assumes the last inventory added will be the first sold.
(ii) On the Operations from: The system manages, controls and directs all operations including receiving processes, put away processes, order processing, inventory allocation, picking process, packing process and finally shipment along with inventory updating. The intelligent system guides and helps operations managers to schedule and manage all operations for various groups and teams simultaneously depending upon the workload and pattern and thereby manage resource allocation too.
8. What are the objectives of warehouses?
Ans: The primary objective of warehouse is:
(i) To stock the products to meet the future requirements ex: rice and other food items by FCI.
(ii) To stock the raw materials to enable continuous production process. and
(iii) To stock the finished products to enable planned distribution and sale.
9. Write about the importance of warehouses?
Ans: Following are the importance of warehouses:
(i) Enable the storage of raw material, finished goods, semi-finished goods, goods in transit, seasonal goods, etc.
(ii) Enable the efficient distribution of goods; for example, storage of crops after harvesting to distribution in the areas where they are processed or to places where there are shortages.
(iii) Ensure stable prices, as stored output can be used during the time of low production.
(iv) Enable grading and picking of goods.
(v) Provide perfect space for the preservation of perishable commodities for example, storage of meat, vegetables and fruits in cold storage.
(vi) Protect goods during unfavourable climatic conditions.
(vii) Reduce the risk of theft and damage of products.
10. Explain steps in the warehouse management process.
Ans: Warehouse management is the act of organising and controlling everything within the warehouse and making sure it all runs in the most optimal way possible.
This includes:
(i) Arranging the warehouse and its inventory.
(ii) Having and maintaining the appropriate equipment.
(iii) Managing new stock coming into the facility.
(iv) Picking, packing and shipping orders.
(v) Tracking and improving overall warehouse performance.
11. Write about the objectives of the warehouse.
Ans: The primary objective or goal of warehousing is to meet the diverse needs of a company’s marketing function. Any company is not so famous that it has an advance order to supply. Moreover, production and supply have a significant time difference. It allows you to stock inventory, repackage, and use eCommerce shipping solutions at scale.
The warehouse resources and customer requirements are the two important points to be considered. Warehouse tries to maximise the utility of space, ensures protection of the goods against theft, preserves the perishables and enables a planned and staggered distribution of the goods as and when required. In the case of agricultural products, warehouses prevent wastage by providing storage and maintenance services.
