Warehouse and DC

Management (WM)
SAP Best Practices for Retail (India)

SAP Best Practices

Scenario Overview 1

Purpose and Benefits:

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 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 Store Manager

Retail Warehouse Manager

Retail Warehouse Clerk

Process Flow Diagram

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

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

4.2
Receipt of
incoming
Goods

Alternative 1:
Confirm without
difference

5.1.3.2
Create a
Transfer Order
in the
Warehouse

Retail
Warehouse
Manager

4.2.2
Enter an
Actual
Appointment

4.4.1
Alternative 1:
Asynchronous
Warehouse
Management

4.3
Put away
Preparation

Alternative 2:
Confirm with
difference

6.1
Replenishment
Planning

6.2.1
Create a
Transfer
Order

6.2.2
Confirm
Transfer
Order

Retail Store
Manager

5.1.4
Goods
Collection

4.2.1
Post Rough
Goods
Receipt

7.1
Create an
Outbound
Delivery

4.2.3
Goods
Receipt with
Reference to
the Rough
Goods
Receipt

4.4.2.3
Putaway
Processing

4.4.2.1
Ressource
Planning with
the RF Monitor

Retail
Warehouse
Manager

Retail Warehouse Clerk

Process Flow Diagram

7.2.1
Create Transfer
Order as a
Picking
Document

7.2.2.1
Alternative 1:
Asynchronous
Warehouse
Management

7.4.5
Subsequent
Delivery Split

7.4.4
Confirm Transfer
Orders in
Collective
Processing

7.4.6
Goods Issue in
Collective
Processing

8.2.2
Trigger
Inventory
Recount

8.1
Create a
Physical
Inventory
Document

8.2.1
Manual Entry

Alternative 1:
Confirm without
difference

Alternative 2:
Confirm with
difference

7.4.3
Create Transfer
Orders in
Collective
Processing

7.2.2.2.1
Resource
Planning in the
Monitor for
Mobile Data
Entry

7.4.2.1
Alternative 1:
Automatic
Capacity-Driven
Creation of
Wave Picks

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

7.4.2
Creating
Wave Picks

7.4.1.1
Alternative 1:
Manual
Creation

7.4.1
Create
Deliveries with
Planned
Picking Time

7.4.2.2
Alternative 2:
Creating Wave
Picks Manually

8.2.3
Carry Out
Inventory
Recount

9.4.2
Rough Workload
Estimate After
Goods Issue

8.3.1
Post Differences
in Warehouse
Management

9.4.1
Rough Workload
Estimate After
Creation of
Outbound
Deliveries

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

Document Flow in the Warehouse

PO
Inb. Delivery
Rough GR

GOODS RECEIPT

GR
GRArea
Area

PUTAWAY
TRANSFER ORDER

WAREHOUSE
Outb. Del.
GOODS ISSUE

Shipping
Shipping
Area
Area

PICKING
TRANSFER ORDER

Inventory Management - IM vs. WM

Inventory Management on article

level

Site
Storage Location

Fixed storage bin can be maintained

in the article master (text field)

Inventory Management on bin level

Whse number
Storage type
Putaway / Picking strategies are
Storage section
used
Storage bin

Storage bin is master data and can

be determined by strategy (other
than fixed)

Warehouse Structure - Warehouse PC1

Gate 1 Gate 2
1

Section 002 Slow moving items

H01
High Rack Storage
Random Storage

GR-Area

Section 001 Fast moving items

Section 001
Total Section

H01 / B01 / F01

Storage for
Special Goods
(depending on
master data)

Section 002 Slow moving items

K01
Picking storage type
Fixed storage bins
Section 001 Fast moving items

GI-Area
3

Gate 3

Gate 4

Storage Bins - Warehouse PC1

Gate 1 Gate 2
1

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

GR-Area

21 aisles, each with 50 bins

All Storage bins in

Total Section

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

Bins 01-001
to 05-025

GI-Area
3

Gate 3

Gate 4

Putaway Post Goods Receipt

Goods
Goods Receipt
Receipt

Movement
Movement type
type

Article
Article

GI
Do
cu
m

en
t

Quantity
Quantity

Site
Site

Stor.
Stor. location
location

WM
Warehouse
Quant
in the GR-Area of
the Warehouse
Transfer Requirement

Putaway Transfer Order

Transfer Requirement
Quant

Pu
taw
al
mo ay
v

(ph
ys
ic

em
en
t)

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
Storage type
Picking storage type

(PC1)
(K01)
(K01)

Storage bin
Maximum bin quantity
Minimum bin quantity
Rounding quantity
Control quantity
Replenishment qty.

(KOM-04-003)
(50)
(10)
(blank)
(blank)
(blank)

Stock check Triggering Replenishment

Stock in bin
smaller than
minimum quantity?
Trigger
replenishment
Reserve storage

Transfer request
is generated

Create
Transfer Order

Picking Zone

Physical Goods Transport

Confirm
Transfer Order

Picking Delivery

Delivery

Delivery
Delivery

Article
Article

Quantity
Quantity

Site
Site

Stor.
Stor. Location
Location

Goods Issue

WM
Warehouse

Delivery is relevant for picking

! Transfer order required

Picking Transfer Order

Delivery

Quant

Pic
k

Create
Transfer Order
Automatical
determination
of storage bins

(ph
ysi
ca
l

i ng

mo
ve
m

en

t)

Picking Storage Type

Picking List

Quant

Transfer Order

Confirm
Transfer Order
Confirm Picking Quantity

In the
shipping
zone

Picking Goods Issue

Delivery

Delivery
Delivery
Goods
Issue

Article
Article

Quantity
Quantity

Site
Site

Stor.
Stor. Location
Location

Goods Issue

WM
Warehouse

Delivery is relevant for picking

order required
Picking
is finished
! Transfer

Mass Processing of Deliveries

Delivery
Delivery
Delivery
Delivery
Delivery

Manual creation in the outbound delivery monitor

using selection by:

Shipping point
Picking date
Route, carrier ...
Free selection

Delivery
Delivery

Automatic generation using selection by:

Picking date / time

Additional filter by several criteria
(e.g. route, shipping point, ship-to-party ...)

Considering capacity restrictions:

Group of Outbound
Deliveries
or
Wave Pick

Weight, volume
Maximum items on the picking list
Working time
...

Mass Processing of Deliveries

Delivery
Delivery
Delivery
Delivery
Delivery
Delivery
Delivery

Group of Outbound
Deliveries
or
Wave Pick

Collective Follow-On-Processing:

Create transfer order

Confirm transfer order
Post goods issue

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
Delivery
Delivery
Delivery

Calculation of
workload using:

Estimated
Workload in:

Logistics Load Category

Unit of Measure
Whse no. / storage type
Warehouse process

Quantity
Weight
Volume
Execution time

Delivery

Information on:

needed manpower
needed transport
capacity

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

Tr
an

sfe
r

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.

Or
de

The system provides the warehouse

employees with transfer orders from their
queue continuously.

rs

Touch screen of the

warehouse employee

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

Initialize Recount

Process
Difference List
Clear differences in
Warehouse Management

Unblock storage bins

Inventory
Difference

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