The relationship between Technology and Warehousing...12 Chapter 3: WAREHOUSING MANAGEMENT PRACTICES AT LAZADA INC.. DANH MỤC HÌNH ẢNHPicture 1: Automated guided vehicle of Sharp Japan..
Trang 1MỤC LỤC
DANH MỤC HÌNH ẢNH 3
Chapter 1: INTRODUCTION 4
1.1 Problem stament 4
1.2 Research objective 4
1.3 Scope of the report 5
1.4 Structure of the report 5
Chapter 2: LITERATURE REVIEW 6
2.1 Warehouse and Warehouse management definition 6
2.1.1 Warehouse 6
2.1.2 Warehouse management 6
2.2 The role of Warehousing 6
2.3 The function of Warehousing 7
2.3.1 What is the function of the warehouse? 7
2.4 Warehousing activities 8
2.5 Warehouse operations 11
2.6 The relationship between Technology and Warehousing 12
Chapter 3: WAREHOUSING MANAGEMENT PRACTICES AT LAZADA INC 16
3.1 Lazada Inc introduction 16
3.1.1 What is Lazada 16
3.1.2 Lazada of which country 17
3.1.3 What is Lazada's business model 17
3.2 Introduction about Lazada’s Warehouse 18
3.2.1 Warehouse system in Vietnam – Lazada Express 18
3.2.2 Warehouse’s infrastructure of Lazada 21
3.3 Warehouse system operations in Lazada Inc 27
3.4 Advantages and disadvantages of Lazada’s warehouse system 29
3.4.1 Advantages 30
3.4.2 Disadvantages 30
Chapter 4: Implications for Vietnamese Businesses 31
Conclusions 33
Trang 2RESOURCES: 34
Trang 3DANH MỤC HÌNH ẢNH
Picture 1: Automated guided vehicle of Sharp (Japan) 13
Picture 2: Sorting and picking systems – Resource: (Tổng quan về xe tự hành AGV trong nhà xưởng, n.d.) 14
Picture 3: Lazada company 16
Picture 4: The simplificated logistics process from seller to customer 17
Picture 5: Lazada's warehouse location 19
Picture 6:Warehouse Management System of Lazada 21
Picture 7: Lazada's automatic sorting system 22
Picture 8: The system of sensors and scanners automatically measures the dimensions, weighs the goods 23
Picture 9: One point of delivery (Drop-off Points) of Lazada cooperates with Coop food system 24
Picture 10: A smart locker (Smart Lock) of Lazada in collaboration with partner Ilogic.25 Picture 11: The lockers all have security cameras monitoring 24/7, ensuring safety when sending and receiving goods 26
Picture 12: Lazada’s warehouse 27
Picture 13: Attaching barcodes to products 28
Picture 14: Barcodes scanner 28
Picture 15: Automated coveyor belt in Lazada 29
Trang 4Chapter 1: INTRODUCTION
1.1 Problem stament
Today, the scientific - technological revolution and its achievements arecontributing to rapidly and profoundly changing all aspects of social life, becoming areally indispensable tool in many basic fields In the fields of activities such as: economy,military, education, health, especially, in management, most of Information Technology(IT) has affirmed its strength quite clearly and is definitely increasing fundamentallyreplace manual management methods, in particular, quite significantly Warehousemanagement in an enterprise is essentially a major undertaking that requires themanagement department to conduct for all intents and purposes many truly complexactivities in a subtle way Not only do businesses inevitably have a centralizedclassification model, but most organize a distributed warehouse model across manydifferent locations Therefore, the traditional way of warehouse management willbasically no longer be effective in general The application of IT has brought a newbreakthrough to warehouse management, helping businesses capture information aboutgoods, supplies, raw materials and products in a really timely manner, suitable for allintentions and purpose From there, business managers can generally make the rightplans and decisions, really reduce costs, increase competitiveness and most importantlyimprove production and business results basic is key Lazada is also a good example ofapplying information technology to management At the same time, we chose this topic
in the hope that we can analyze warehouse management to be able to offer suitablesolutions for businesses in Vietnam
1.2 Research objective
This report focuses on 3 main objectives:
Overview of warehouse management
Trang 5 Introduction to Lazada warehouse management Management systems,special information technologies are applied by them.
Analyze the highlights in warehouse management and give lessons forVietnamese businesses
1.3 Scope of the report
Warehousing management practices at Lazada Inc
1.4 Structure of the report
The report has 4 chapter Chapter 1: chapter 1: Introduction; Chapter 2: Literaturereview; Chapter 3: Warehousing management practices at Lazada Inc, and the last,Implications for Vietnamese Businesses
Trang 6Chapter 2: LITERATURE REVIEW
2.1 Warehouse and Warehouse management definition
2.1.1 Warehouse
In the logistics system, the warehouse is a very important place because it is wherethe raw materials, semi-finished products and finished products for business are storedthroughout the process from the starting point to the final point in the supply chain.However, the warehouse also provides us with information about the status of rawmaterials as well as goods There is also other information such as storage conditions aswell as the location of items stored in the warehouse
2.1.2 Warehouse management
Warehouse management is a part of Logistics management field Choosing awarehouse location is very important because the warehouse is strategic The location ofthe warehouse will affect many factors such as: transportation costs, quality of customerservice, speed of goods movement in particular and the entire logistics chain in general
In order to have an appropriate warehouse location, it must be based on thefollowing factors: close to large commercial centers, have good infrastructure, and simpleprocedures, especially customs clearance procedures Not only that, there are otheradditional factors to evaluate the location of the warehouse: transportation costs, housingmarket prices,
Warehouse management and inventory are closely related These two jobs bothcontribute to the added value of the time and place of the product The design of awarehouse and production facility in a scientific, reasonable and consistent manner withthe factors mentioned above will help cut costs at input and output The price of an item
is high or low or different because the good depends on the distance If you can managethe warehouse well, it will help improve the quality of services and customers with thelowest cost
2.2 The role of Warehousing
Trang 7Warehousing is an important function of a business involving logistics Efficientwarehouses are critical to increasing customer satisfaction and help ensure that productsare delivered to customers quickly and accurately.:
“Get the right item, in the right quantity, at the right place, at the right time,
in the right condition, at the right price at the optimum cost to theorganization” - 7R in Warehousing The Chartered Institute of Logistics &Transport UK (2019)
2.3 The function of Warehousing
As mentioned in the concept of warehouse and warehouse management, itdepends on the business model of the business that the warehouse design isappropriate
Save shipping costs to the maximum
Supply raw materials, semi-finished products, finished products quickly and
on time
Always maintain the supply to serve the production and business process
Meeting the needs of customers in a timely manner
2.3.1 What is the function of the warehouse?
Support for production
Trang 8In order to produce finished products, it is necessary to have raw materials,components, spare parts manufactured and supplied from different factories The rawmaterials, components will be kept in stock and promptly provided for the productionprocess as quickly as possible Thanks to the warehouse always provide for productionwork as quickly as possible so that the production process is not interrupted.
Product Summary
In case the company has many suppliers of raw materials, each supplier will providethe enterprise with different raw materials, and the output of the company has manydifferent customers with different product needs At the warehouse, the goods willperform the aggregate function Goods and materials will be aggregated and reinforcedaccording to each order
Consolidation
There will be customers who need items in bulk In case a product supplier is notable to supply the customer) The enterprise's warehouse, goods will be gathered fromdifferent suppliers to pack a large shipment for the customer at the request of thecustomer customer
Sorting out
There will be cases where customers need products in small quantities Goods will
be brought from the factory to the warehouse and at the warehouse will perform theoperation of separating large shipments into small batches of quantity and quality suitable
to the needs of customers
2.4 Warehousing activities
The main purpose of the activities in the warehouse is to create a smooth flow of goods,making it easier for products to come in and out
Some basics activities of warehousing:
Identification: identifying the products, matching with the order and confirm thenumber of products in stock
Trang 9 Inspection: checking the quality, quantity of products, condition of goods damaged
or lack of components, materials, …
Receiving and unloading: accepting the products and unloading goods fromvehicles
Put away: the process of importing products from the container to the storage area
Packaging and marking: Cargo packaging helps the goods to reach the customerundamaged, protects the product and avoids financial losses Marking is the use ofinformation symbols, special symbols, etc to provide information about theproduct’s content Be careful with your hands or avoid direct sunlight depending
on product characteristics, minimizing damage goods
Staging and consolidation: A staging area is a temporary storage area for goodsthat have been consolidated by each other and then brought into the warehouses oranother locations
Loading and shipping: After packing, loading is the arrangement of goods ontransport vehicles such as trucks or other vehicles to ship the goods Shipping isthe process by which items will arrive safely and on time
Trang 10 Documentation: In warehousing, there are many types of documents used to allowproducts to be transported from one place to another place so before shipping, allkinds of documents must be prepared
Housekeeping: It includes keeping the warehouse clean, maintaining an orderlyand untidy work area help everything go more smoothly, to get job done
Management of material handling equipment: It refers to the equipment used forthe transportation, storage and protection of goods in the warehouse Management
of material handling equipment helps to create convenience, speedy and efficiencyfor other activities in warehousing
Assist in stocktaking: It is the activity of counting goods currently in stock,helping to control inventory, verifying the actual quantity and condition of goodsstored in the warehouse
Consolidation activity:
o It means collecting raw materials, small shipments from many supplier andbringing them together in the same place
o There are many benefits to doing this activity:
The first thing is to help achieve higher efficiency, because diverse componentsand materials are concentrated in same place, all warehouse operations will begathered in one place to help saving time collecting shipments in multiple places
so can help businesses focus on business development
It does not take time to transfer between places to finished goods, it can savedelivery time and increase customer satisfaction
The last thing, consolidation saves more shipping costs, because all goods aregathered in one location to be delivered to a specific location, so the product onlyships directly to the customer without intermediaries
Break-bulk activity:
Trang 11 This activity has only one supplier, provide a larger quantity products at thewarehouse, and you have to divide the products into smaller quantities,smaller orders and ship to more customers.
The main benefit of this operation is ship oversized, overweight orders, ordelivering products to many different customers
(Waters 2003)
2.5 Warehouse operations
Warehouse operations include a number of important processes from receiving,arranging, preserving to shipping, to be able to bring customers the best experience.Warehouse operation as defined by Rick Stinchcomb of the University of OklahomaPress: “The goal of warehouse operations is to satisfy customers’ needs and requirementswhile utilizing space, equipment, and labor effectively The goods must be accessible andprotected Meeting this goal requires constant planning and ongoing change.”
There are 5 key goals we need to pay attention to when operating a warehouse:
Warehousing productivity analysis: It will help the company to evaluate the
productivity and efficiency of the warehouse We can measure warehouse by casesshipped per person, product lines shipped per person, pallets shipped per person,average warehouse capacity and forklift capacity used
Safety considerations: The construction or rental of warehouse will all be affected by
Government regulations For example, warehouses containing dangerous materials,goods must comply with fire protection, the warehouse location must be far awayfrom residential areas, there will be a team of inspectors to regularly check thewarehouse meets the standards
In addition, the safety of labors, property, as well as machine and vehicles must
be considered Empty cartons, damaged products or broken pallets will also causehazards so safe handling measures are required to avoid fire or explosion
Trang 12Warehouse safety help to reduce injuries, increase employee satisfaction leading toincreased work efficiency.
Hazardous materials: The storage of hazardous materials such as explosives,
flammable liquids, flammable solids should be carefully controlled The issue is beconcerned to warehouse managers because of its dangerous, which could causeaccident or death for labors Each materials has its own storage requirements, soensure there is a separate storage place, meeting the requirements of fire protectionand safe working environment for employees
Warehousing security: It is one of the most important and often occurring aspects
of the warehouse because it will cause financial loss and work progress.Warehousing security issues including theft, pilferage, heat and humidity,vandalism, fire and loss of electricity Because the warehouse is a huge place andstores a lot of goods, machine everyday with a large number of employeesentering and leaving, ensuring security should be a top priority Not only theproduct is stolen, but also the product is not to ensure the process of temperatureand humidity could affect the quality of product like fresh foods, medicine,…
Cleanliness and sanitation issues: It is an important issue in the foodservice
industry In addition, keeping the warehouse clean will help employees work morecomfortably and safely Keeping clean and taking care of hygiene issues is not toodifficult to manage, it is based on common sense and diligence, which is very easy
to do but can run a productive business
(Paul R Murphy 2018)
2.6 The relationship between Technology and Warehousing
Today, technology is indispensable in people’s life, especially when industry 4.0develops In the context of information technology globalization, technology plays animportant role in the development of logistics service, which is considered the lifelineconnecting the components of the entire logistics service chain Warehouse are noexception, to keep up with the rapid advancement of technology, warehouses need to be
Trang 13equipped with automation to keep pace with the production process and consumerdemand In previous years, technology has not been applied much in the warehouse, so ithas depend on workers, everything such as sorting, arranging and organizing is done byhumans, it will take a lot of time but it will not achieve the desired results It can be saidthat the development of the warehouse is associated with technology, which plays animportant role in the management and operation of the warehouse There are sometechnologies have been applied by warehouse all over the world:
Automated guided vehicle: transport materials and goods to pre-marked locationswithout human intervention
Picture 1: Automated guided vehicle of Sharp (Japan)
Sorting and picking systems: The line will automatically classify products based
on criteria such as size, height, weight, … helping to classify according to themanufacturer’s information and purpose
Trang 14Picture 2: Sorting and picking systems – Resource: [ CITATION Tổn \l 1033 ]
Blockchain item tracking: helps warehouse managers track the physical location ofproducts, detect theft, and can forecast product demand based on data logs thetechnology
The application of technology to the warehouse will bring a number of benefits tobusinesses:
Reduce labor costs and risks: A fully automated systems, the most complex stages
of the process will be automated, and this job only needs a manager, while thetraditional method requires several dozen people to sort and transport Automatedtechnology will complete the job with less errors and chips in the whole process
Save time and place: The technology will help save storage space up to 50%because the mounting patterns are conducted according to the standardizationmaking storage easier Instead of having a lot of time on arranging and sorting
by hand, now the capacity can be increased by 3 – 5 times, helping to achievequick efficiency, increasing the number of hours of operation
The system is flexible, easy to customized: In a traditional warehouse, everytime a business changes, employees must be notified of the operation, but in awarehouse with technology, everything happens very quickly, adding orremoving a process into the operation is easy to implement, helping to be moreproactive with many situations
Trang 15 In the current industry 4.0, technology capacity is also a decisive factor in thecompetitiveness of logistics and warehousing service providers Warehousemust have new technology to meet customer needs, because no one wants torent old warehouses, without advanced technology, it will affect productquality and delivery progress The company had to upgrade technology, couldnot be slower than competitors and did not respond to market demand.Moreover, a company that invests in warehouse technology, the operation will
be accurate and efficient, and will help businesses feel secure in providing thecore product Therefore, to meet the increasing requirements of customers and
to avoid rejection from the market, it is necessary for warehouse to install andupgrade modern technologies As seen, the strong development of warehousestoday is largely due to the application of technology to the warehouse, which isthe tool that helps the warehouse to exist and develop as it is today
Trang 16Chapter 3: WAREHOUSING MANAGEMENT PRACTICES AT LAZADA INC.
3.1 Lazada Inc introduction
If you are a lover of online shopping, you must know about Lazada You'veprobably shopped a lot on its Lazada.vn and apps Do you know what Lazada is?Lazada of which country? What is the history of this e-commerce platform? Yes,shopping everywhere is safe and to be sure, you have to find out exactly whereyou go to buy So this article we will find out about what Lazada is and all that isrelated to Lazada
3.1.1 What is Lazada
Lazada or rather lazada.vn is a leading e-commerce platform in Vietnam as well asSoutheast Asia To imagine more easily, you can imagine that Lazada created a virtualplatform, on which to create booths It is a place for customers and sellers to meet andexchange with the middleer is Lazada Of course, Lazada will receive a portion of thecommission from the seller Any individual, organization, business or brand canparticipate in sales on Lazada Of course, the goods on Lazada are still fully guaranteedboth in quality and prestige
Picture 3: Lazada company
Trang 173.1.2 Lazada of which country
Since its inception, Lazada Group is a German electronic trading company It wasfounded by Maximilian Bittner and supported by Rocket Internet in 2012 and it operates
in Southeast Asia As of 2015, it was operating in six countries in the region: Indonesia,Malaysia, the Philippines, Singapore, Thailand and Vietnam It was acquired by JackMa's Alibaba group until 2015 and the deal was completed in 2015 To this day, Lazada
is owned by Alibaba Group of China
3.1.3 What is Lazada's business model
Lazada's business path is the market place model That's the middle of onlineshopping According to the exact figures from January 2016 that Lazada has provided,this unit has worked with more than 3000 suppliers Along with that are more than500,000 different products Since then, I'm not sure how many times this number hasmultiplied The intermediary between the buyer and seller will help Lazada earn a smallcommission from each seller's order In contrast, Lazada also offers the best services forboth sellers and buyers Lazada offers a simple payment process, many options, alongwith the most professional transportation and customer service
Picture 4: The simplificated logistics process from seller to customer