An evaluation of distribution and warehousing systems in the perishable foods industry

M.Comm.South Africa is currently in the same position regarding distribution channel design and operations as the rest of the world during the 1970's and many of our warehouses still operate in the same manner as those of the 1970's, using outdated methods and infrastructures. According to Bailey (1996:3), the failures of the outdated systems were: 90% of the systems functioned ineffectively - High-tech systems were inflexible ; - Computers could not cope ; - Focus was on storage rather than throughput ; - Just-In-Time destroyed many facilities ; - Lack of integration within the supply chain Some distribution executives and warehouse managers may disagree, but it is evident that there is uncertainty and frustration associated with the management of warehousing activities in companies today. During research conducted, a statement was made by a distribution executive of a leading corporation, who said: "I am unaware of any corporate function where the manager knows so little about what he will do tomorrow as the manager of a warehouse." Traditionally, warehousing has fulfilled a support function to both manufacturing and marketing by storing the company's raw materials, semi-finished and finished products. However, the warehousing function also responded to other corporate needs without receiving the necessary attention and support of management to improve its organisation and effectiveness. The challenge of this study will therefore be to design and develop a distribution channel which will approach the supply chain holistically, from the identification of the total costs associated with alternative logistical systems right through to identification of the lowest cost network that meets corporate, marketing and customer requirements. The objective is to develop a strategy for a throughput distribution centre close to the market place to shorten the cycle time within the South African context, which will accommodate the principles of reducing individual warehousing requirements and transportation costs by transforming the modus operandi from the conventional "push" way of operating to a "pull" system. This is commonly known as Quick Response (QR) or Continuous Replenishment (CR) and will allow the principals to reduce stockholding areas and simultaneously provide fresh delivery