Logistics.

1. Scope

The scope of this process is to display the different options for managing and controlling logistics within the system, as well as inventory control of products, since everything related to this topic is part of one of the fundamental pillars that allows for proper management to offer a good corporate experience and organization. This scope includes the following:

• Inventories

  • Warehouses and locations

  • Stock

  • Costs

• Picking

  • Balancing

  • Picking Lists

  • Customs

• Packing

  • Packing Labels

  • Invoice Printing

• Transportation

  • Delivery

  • Dispatch

• Tracking

• Analysis

1.2. Software Coverage

• Inventories

  • Warehouses and locations

  • Stock

    • Availability

    • Movements

    • Tracking

    • Lots, Expiry Dates

  • Costs

    • By product

    • By location

• Picking

  • Balancing/Location

    • Picking lines configuration

    • Locations on the line

  • Picking

    • Picking list

      • Included as a report in orders.

      • PDA or tablets for picking

    • Calculation of the number of boxes

      • Optional

  • Customs

    • Review of dispatched references

    • Order revaluation

• Packing

  • Packing labels

  • Invoice printing

• Transportation

  • Delivery

    • Customs clearance of boxes

    • Cargo manifest to the carrier

  • Dispatch

    • Assignment of dispatch guides

• Tracking

  • Loading transport guides

    • WS (Web Services)

    • Files

  • Status update process

    • WS (Web Services)

    • Files

  • Tracking and communication to users (emails)

    • Order

    • Email

• Analysis

  • Logistics reports

2. Definitions

What is the difference between "Inventario" and "Stock"?

Inventory encompasses all the assets of a company, both for internal use and for sale, and it can be defined as a comprehensive count to maintain control and analyze all products.

On the other hand, stock refers to the specific quantity of products that are available for sale, and in addition to this, the count helps to understand the fluctuation of each product, being aware of which ones sell more and in what timeframe.

What is a "traslado entre bodegas" (transfer between warehouses)?

It is the physical or virtual movement of merchandise or products between warehouses and cost centers.

3. Key Features

• Warehouse Management: The system allows for the creation of multiple warehouses to enhance control and management of products.

• Transfers between Warehouses: Product movements between warehouses can be executed based on the company's needs or strategies.

• Freight and Logistics Operator: Multiple freight values can be associated with different logistics operators.

• Tracking: Order traceability is supported, allowing for monitoring and tracking of orders.

4. Conditions

For the proper utilization of the software's functionalities, it's necessary to have previously defined the technical and/or business elements, such as:

• Warehouses: Determine which warehouses will be used and whether transfers between them are allowed.

• Inventory: Define the minimum inventory levels accepted by the company and the frequency and method of loading and updating these levels.

• Packing: Define the packaging to be used based on the handled products.

• Carriers and Freight: Define the logistics operators and the freight charges to be applied based on geographical location.

5. Operation

5.1. Journey

• Daniel in Logistics for these processes:

  • Inventory Management

  • Logistics and Distribution Management

  • Management of Multiple Warehouses

  • Management of Pending Orders

  • Shipping Options

6. Configurable Elements

The following are the elements to configure in the software:

6.1. Main Configurations

• Warehouses

• Carriers

• Reasons for Differences in Picking

• Picking Lines

• Picking Stations

• Shipping Costs

• Logistics Information

• Types of Inventory Movements

• Service Levels

6.2. Related Module Configuration

• Freight Values

• Logistics Operators

• Creation and Costs of Products

6.3. Module Configuration

6.3.1. Warehouses

This module allows for a virtual representation as close as possible to the physical space of the company's warehouses.

In this module, relevant information is configured such as:

• Warehouse location.

• Shipping cost configured in case the inventory of the products in the order is located here.

• It is also possible to configure the lines within each warehouse through this module.

Note: "Lines" refer to the aisles or divisions within each warehouse.

Furthermore, this manager allows for the creation, modification, and deletion of warehouses and their respective lines. Additionally, warehouses can be created in bulk through a flat file.

To create a warehouse, it is necessary to have the following previously created and configured:

• Political Divisions and Zoning.

When configuring a warehouse, it enables other processes to be configured correctly, such as:

• Inventory configuration.

• Product cost configuration.

Open

Open

6.3.2. Transport (Carrier)

In this module, the company configures information about the transport entities that will be used throughout the entire logistical process for shipping orders.

Here, relevant information is configured, such as:

• Carrier's tax identification number (NIT).

• URL of the transport entity.

Furthermore, this manager allows for the creation, modification, and deletion of transport entities. Additionally, information can be exported via a flat file.

Creating a transport entity does not require any prior configurations.

When configuring a transport entity, it ensures that other processes are correctly configured, such as:

• Logistic Information (Shipping cost based on geographical zone).

This information is visible in the order details when the order status is "released."

6.3.3. Pick Discrepancy Reasons (Pinion)

In this manager, the reasons that arise during the picking process are established. The system defaults to the following pick discrepancy reasons:

• Irreplaceable units: This occurs when the product (unit) cannot be replaced in the inventory.

• Ok: No discrepancies are found in the inventory compared to what the customer requested.

• Out of stock: This happens when the requested product is discontinued or there are no available units.

• Empty: This occurs when the requested product is not found in the inventory.

Furthermore, this manager allows for the creation, modification, and deletion of pick discrepancy reasons.

Creating a pick discrepancy reason does not require any prior configurations.

6.3.4. Pick Lines (Pinion)

Order picking is a critical activity in logistics, involving the selection and extraction of products from a warehouse to fulfill customer orders. To perform this task effectively and accurately, the operator must follow pick lines, which are the optimal routes they should follow within the warehouse to locate products. These pick lines are specified in a document that contains product details (name, quantity, location, aisle, shelf) and the order in which they should be collected.

This manager allows for the creation, modification, and deletion of pick lines. It is not necessary to have any prior configurations to create one.

Configuring a pick line enables other processes to be correctly configured, such as:

• Picking stations.

6.3.5. Picking Stations (Pinion)

Picking stations are crucial zones within a company's logistical process. In these areas, workers are responsible for selecting the items requested by customers and packing them correctly for shipment. Picking stations should be well-organized and equipped with the necessary resources to ensure efficiency and the quality of service.

This manager allows for the creation, modification, and deletion of picking stations.

To create picking stations, it is necessary to make prior configurations such as:

• Pick Lines.

6.3.6. Shipping Costs

This module allows for the configuration of shipping costs. Using this module, when an order is placed, a calculation of various charges (taxes, products, discounts, shipping, etc.) must be carried out to determine the total order amount. This ensures that the payment is accurate. Shipping costs depend on different factors, such as geographical zones, and can be configured accordingly.

In this module, relevant information is configured, including:

• Type of cost.

• Currency.

• Taxes.

This manager enables the creation, modification, and deletion of shipping costs. Additionally, shipping cost information can be exported, and shipping costs can be created in bulk through a flat file.

To create a shipping cost, it is necessary to have previously created and configured:

• Currency.

Configuring shipping costs ensures that other processes are correctly configured, such as:

• Logistic Information.

These are visible in the order details.

6.3.7. Logistic Information (Pinion)

The logistic information manager allows for the configuration of everything related to product shipping, categorizing it based on:

• Shipping delay time according to territorial division.

• Geographical zone.

• Transport entity.

Based on all this provided information, a shipping fee is added, and logistics for shipping are managed by territorial divisions. Furthermore, this manager enables the creation and modification of logistic information. Information can also be exported and loaded through a flat file.

To provide logistic information, it is necessary to have previously created and configured:

• Transport entity.

• Political Divisions and Zoning.

• Shipping Costs.

This information is visible when making a payment for an order.

6.3.8. Inventory Movement Types (Pinion)

Inventory movements encompass all the processes related to inventory management. Therefore, it is essential to have a comprehensive understanding of the inventory movements that have occurred.

This manager allows for the definition and categorization of the types of movements that can be performed concerning inventory.

Example: when a replenishment is made, when inventory is transferred, etc.

Furthermore, this module enables the creation, modification, and deletion of different inventory movement types. No prior configurations are required to configure inventory movement types.

Configuring an inventory movement type ensures that other processes function correctly, such as:

• Inventory Movement.

This information is visible when performing an inventory movement.

6.3.9. Service Level

Service level is a concept that measures a company's ability to meet customer demand without experiencing inventory shortages. 

It is expressed as a percentage, indicating the likelihood that a customer can purchase the product they desire at the moment they request it. 

For example, if a product has a service level of 95%, it means there is a 95% chance that the customer will find that product available when they order it. 

The service level depends on various factors, such as inventory management, supplier lead times, and demand variability. 

A high service level implies better demand coverage and higher customer satisfaction, but it also involves higher inventory costs and a greater risk of obsolescence. 

Therefore, it's important to define an optimal service level that balances the benefits and costs of maintaining inventory. 

For instance, a company selling perishable goods may opt for a lower service level to avoid discarding expired products, while a company selling high-demand items might choose a higher service level to prevent lost sales and customers.

7. Detailed Scope

7.1. Inventory

7.1.1. Warehouses and Locations

Warehouses are virtual spaces that enable optimal and proper inventory management by providing access to records of the company's merchandise resources.

For better inventory management, S4DS supports the management of multiple warehouses and multiple locations.

7.1.2. Stock

7.1.2.1. Availability

Stock refers to the existence and availability of products, both in inventory and in the warehouse. It allows for recording and managing products for sale to customers.

In S4DS, managing product stock and inventory becomes easier, thanks to the inventory module. This module allows for tracking:

• Product availability and related information.

• Recorded movements.

• Updating or bulk-loading inventory through flat files or individually through the administrator.

• Performing inventory transfers between warehouses.

7.1.2.2. Movements

Having the ability to closely monitor inventory movements and conduct audits of the processes related to inventory is essential for a company. It allows for continuous tracking of the resources available for sales to customers.

S4DS offers this module, which enables the observation of all transactions related to inventory. These transactions include inventory loading, inventory closing, inventory commitment, expenses, negative adjustments, and returns.

The information loading into the system for products is organized by batches and quantities.

There are three different types of inventory loading:

• Inventory Addition (0): Adds the stock defined in the file to the warehouse's operational stock.

• Inventory Replacement (1): Replaces the stock defined in the file.

• Inventory Audit (2): Validates that there are no discrepancies between the actual balance and the system balance.

7.1.2.3. Inventory Movement (Inventory Kardex)

This is a screen where you can view, review, and track inventory movements. Through this module, you can track and query movement types based on SKU categorization.

7.1.3. Costs

Cost, also referred to as expense, is the economic outlay made for the production of a good or the provision of a service. Cost includes the purchase of raw materials, labor payments, production expenses, and administrative costs, among other activities.

Knowing the actual cost of a product or service is crucial for companies, as this information verifies whether the sale versus cost was profitable or not for the company. Costs are loaded through a flat file or web service (WS).

7.1.3.1. Product

For inventory management, products must be created with all the specifications required by the software.

7.1.3.2. Inventory Entry by Warehouse/Batch

To perform inventory loading, it's necessary to input essential information such as:

• SKU (Stock Keeping Unit)

• Batch

• Warehouse

• Units

• Expiration date

• Cost

7.2. Picking (Order Separation)

To separate an order, three actions need to be executed:

• Perform balancing.

• Unit separation (Picking).

• Perform customs clearance.

7.2.1. Balancing/Location

To have better control and management of the warehouse and products, it is essential to have a good location and storage system for the products. This ultimately pays off in terms of the time and operational expenses related to the logistics process.

S4DS provides this functionality to execute the entire logistics process.

• Configuration of pick lines.

• Locations within the line.

7.2.2. Picking

Picking is the process of preparing products from orders to be invoiced and dispatched to customers.

S4DS has a module to execute this process. For this, the orders must be in a valid state for the process, and this action is carried out on a per-order basis.

Picking can be done manually by the administrator or through integration. To do it manually, the administrator exports the balancing report. This report involves registering and managing the products that are part of the sales process for the corresponding cycle. It includes information about the pick line (aisles in the warehouse), stations (locations), and the SKU to be picked.

7.3. Packing

Packing is the activity of packaging and preparing orders, aiming to choose the best option based on factors such as:

• Size

• Weight

• Type of product

Within the S4DS system, we have the packing option, which means that the product in an order is associated with a specific package through labels. This information is highly important for products that are shipped outside of the order and for tracking the order.

• Packing Labels

• Invoice Printing

7.4. Transport

7.4.1. Carriers and Freight

Transportation is a necessary process in logistics management and can also be one of the most cost-intensive and prone to accidents.

Freight costs vary depending on the destination and the logistics operator. S4DS provides the option to create multiple logistics operators per location, each with different:

• Delivery times

• Freight categories

• Freight values

S4DS has different methods in the system for calculating freight costs, and each type is described below:

KEY_ON_HAND:

A fixed shipping price is assigned, typically with several options configured depending on the territory.

Example:

• For Mexico: Shipping cost: $100

• For Colombia: $50

• For the United States: $70

KILOGRAM / CUBIC_METER:

Shipping costs are assigned based on the weight or volume of the order.

Example:

Product a: weight 1 kg

Product b: weight 3 kg

Product c: weight 6 kg

Freight Table:

0 to 5 kg: $5

5.1 to 10 kg: $10

If the order has 2 products of a and 1 product of c, the total weight is 8 kg, and the freight cost is $10.

BOX:

Used when shipping information comes from an external integration.

FIXED_AND_SERVICE:

Used to calculate an additional service or discount value based on the freight cost.

GUIDE:

Shipping cost is obtained by multiplying the category's cost by the number of guides.

The number of guides is obtained by dividing the total weight of the order by the weight defined for the guide.

7.4.2. Delivery

• Customs clearance for boxes

• Cargo manifest to the carrier

7.4.3. Dispatch

Dispatch is the moment when the order has been invoiced and handed over to the logistics operator for delivery to the end customer.

Assignment of a dispatch guide

The primary purpose of this module is to assign a guide number to dispatched orders, according to the carrier or logistics operator. This is done to track the orders throughout the delivery process.

7.5. Tracking

Tracking is the monitoring of the shipment of an order, which is highly important for customers. By accessing the platform through their orders, customers can know in real-time where the product is, the estimated delivery date, or if there are any issues with the delivery.

To perform tracking for an order, it can be done in the following ways:

• Loading transport guides

• State update process

• Tracking and communication to the user (via emails).

7.6. Analysis

• Service Level

• Freight Recovery

• Logistics Transport Report

The report allows you to view orders with their tracking information and track each of them through their logistics information.

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