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Business Process: Goods Receipt and Rejecting Goods Process

1) The document describes a business process for receiving or rejecting delivered goods. It involves receiving goods, inspecting for damage, returning damaged goods to the vendor or delivering accepted goods. 2) It also involves entering a goods receipt in the system and inspecting further, then either ending the process or reversing the goods receipt if the goods are unacceptable.

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Abhijit Ghodake
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59 views

Business Process: Goods Receipt and Rejecting Goods Process

1) The document describes a business process for receiving or rejecting delivered goods. It involves receiving goods, inspecting for damage, returning damaged goods to the vendor or delivering accepted goods. 2) It also involves entering a goods receipt in the system and inspecting further, then either ending the process or reversing the goods receipt if the goods are unacceptable.

Uploaded by

Abhijit Ghodake
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Business Process: Goods Receipt and Rejecting Goods Process

Overview

This business process details the steps for receiving or rejecting delivered goods.

Note: The purchase order must be set up requiring a goods receipt.

Procedure

Receive goods

1. Receive the goods and inspect them for visible damage.


2. If you find damage, go to next step. Otherwise, go to Delivery.

Return damaged goods

3. Notify the vendor that the goods were rejected and shipped back to the vendor.
4. Discuss terms and reach agreement on the delivery of replacement goods under the same
PO number. Go to Receive goods.

Delivery

5. Forward the goods to the appropriate department.


6. The department enters a goods receipt for the purchase order using the system
task Receive Goods Against a Purchase Order (Full / Partial / Over Delivery).
7. The department inspects the goods for any damage or delivery errors.
8. If the department determines that the goods are unacceptable, go to next step. Otherwise,
end procedure here.
9. The department reverses the goods receipt using the system task Reverse Goods Receipt
for a Purchase Order. Go to Return damaged goods.

End procedure.

Order Picking In The Warehouse

Introduction
Order picking can be defined as the activity by which a small number of goods are extracted
from a warehousing system, to satisfy a number of independent customer orders. Picking
processes have become an important part of the supply chain process. It is seen as the most
labor-intensive and costly activity for almost every warehouse, where the cost of order picking is
estimated to be as much as 55% of the total warehouse operating expense. As the order picking
process involves significant cost and can affect customer satisfaction levels, there have been
increasing numbers of process improvements proposed to help companies with this supply chain
issue.

Solutions For Order Picking

A number of supply chain academics such as G.P. Sharp and Edward Frazelle have proposed a
number of ways of classifying the order picking system. Four solutions have been identified for
order picking.

 Picker to Part
 Part to Picker
 Sorting System
 Pick to Box

Picker To Part

This particular method is very common and found in most warehouse environments. The process
involves a storage area, a picking area and a material handing system that is used to refill the
picking locations from the storage area, which can be forklift based or more specialized such as
gravity flow racks. The storage area will contain the items required to fulfill the customer orders.
The picking operator can then pick the items for each customer order from the items stored in the
picking area. As all the items are in a smaller area than the regular warehouse, the picking
operator can fulfill the order more efficiently than if they had to pick the items from the general
storage area in the warehouse. The gravity flow racks are especially useful for items that are
commonly ordered so the picking operator can be in one location and pick items from the trays
in front of them. There are a number of technological advances in “picker to part” processes such
as “pick to light” or “voice picking”. These systems allow picking operators are informed which
item to pick based on a light appearing on the item location or a voice informing the operator on
a headset which item to pick.

Part To Picker

The part to picker method employs the same physical locations as the previous method; storage
area, picking area and a material handling system that moves the items from the storage area to
the picking area. The difference with this method is that the picking area is made up of a series of
picking bays. The items are moved from the storage area and delivered to the picking bays. Each
bay receives the items for one or more orders. The picking operator collects the items delivered
to their bay and the customer order is fulfilled in this manner. This method can be subject to
wasted labor as picking operators can find themselves waiting for items to be delivered to their
picking location.

Sorting System

The sorting process including the requirement for a picking area, a storage area, replenishment of
the picking area and a sorter. This method uses automatic material handling system consisting of
multiple conveyors and a number of sorting devices. The items are placed on a conveyor in the
storage area and the items are sorted for each particular order. The operator in the picking area
collects the items that have been sorted for a customer order and processes that order. The
efficiency is gained because the operator does not have to consume time collecting individual
items.

Pick To Box

Pick to box is similar to the sorting solution as it uses the same elements; a picking area, a
storage area, replenishment of the picking area and a sorter. The picking area is organized so that
there are a number of picking zones connected by a conveyor system. The operator fills the box
with the items on a customer order and the box moves to the picking zones until the customer
order is complete and it is then ready for shipment to the customer. The efficiencies are gained
because the operator does not have to consume time collecting individual items, but the cost of
the initial set up of this solution could negate any cost benefits that the solution offers.

Choosing an order picking system depends on any number of requirements such as cost,
complexity, number of customer orders, size and number of items, etc. Every company has a
unique requirement and one order picking solution may suit one business and not another.
Determining the requirements will ensure that the most efficient order picking solution is
selected.

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