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234 CHAPTER 7 Inventory and Warehouse Management Processes

materials are kept until they are needed. Storage locations can be very large
spaces, such as a room in a plant or even a specifi c area in a large room. It is
important to note that although IM keeps track of the quantity of materials in
a storage location, it cannot determine their exact location. For example, GBI’s
Dallas plant has a storage location for raw materials (RM00), where it stores
numerous materials such as tires, tubes, frames, and wheels until it needs them
for production. Although IM can track the quantities of these materials in the
storage location, it cannot determine exactly where each of these materials is
stored. Thus, when production needs the raw materials, the plant employee
must manually locate them.
In earlier chapters we alluded to a more granular management of materi-
als using warehouse management processes. We also referred to links between
previously discussed processes—procurement, fulfi llment, and production—and
warehouse management. We now shift our focus to a detailed examination
of warehouse management. We begin with organizational data relevant to
warehouse management followed by master data and process steps.

ORGANIZATIONAL DATA IN WAREHOUSE
MANAGEMENT

The key organizational data in warehouse management is the warehouse.
A warehouse is associated with one or more combinations of plant and stor-
age location. For example, in Figure 7-8 the warehouse (100) is associated
with three storage locations (FG00, TG00, and MI00) in the San Diego plant
(SD00). The association between storage locations and a warehouse provides
the linkage between IM processes and WM processes. When linking ware-
houses to storage locations, the following rules apply.
• A warehouse must be linked to at least one storage location.
• A warehouse can be linked to storage locations across multiple plants.
• A storage location can be linked to only one warehouse.

• Not all storage locations must be linked to a warehouse.

Figure 7-8: Organizational data in warehouse management

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