Understanding, Planning, and Implementing Buffer Stock Effectively. When operations within a company come to a standstill and lead to disruptions, this can have a wide variety of causes. The delivery of components for production may be delayed, and available transportation routes may be disrupted or blocked. Market demand is subject to fluctuations. Technical problems within the company itself can also disrupt production processes and the associated supply chain. A buffer stock can mitigate the aforementioned uncertainties.
What is a buffer stock?
A buffer warehouse connects two consecutive process stages to ensure a smooth workflow without disruptions in production, order picking, or shipping.
Advantages and Disadvantages
A buffer warehouse offers the following advantages:
- Increasing productivity by making full use of the available space and thereby ensuring a steady supply to the various processes.
- Having goods available in buffer stock prevents delays in the flow of materials and interruptions in production processes.
- Integration with other operational areas—such as order picking, kit assembly, replenishment management, and goods putaway—helps streamline processes.
- Similarly, the optimal use of storage space leads to synergies.
- Products in the buffer can be subjected to a subsequent inspection without affecting the process itself.
Disadvantages arise from:
- Costs for the storage system, setup, and storage (space required, shelving, etc.).
- Organizational and administrative costs associated with the processes in the buffer warehouse.
Concept of a buffer warehouse
A buffer stock (also known as short-term stock, leveling stock, or interim stock) is used to temporarily store materials that will be needed again in the production process after a short period of time.
By definition, buffer stock must ensure a smooth and uninterrupted production process. In logistics, buffer storage areas are often required at the goods receiving and shipping areas, or between two consecutive production stages. In buffer storage areas, there is usually no fixed storage location for the goods. The structure and size of the buffer warehouse depend on the operational requirements at each process stage, the resulting storage costs, and the risk of potential disruptions.
When planning a buffer warehouse or short-term storage facility in intralogistics, it is important to take into account the available buffer space, the production schedule, the storage system, and the workflows involved. In order to store the necessary materials, it is essential to ensure not only sufficient storage space but also a continuous and timely supply to the production process, as well as the capacity to handle incoming goods.
In addition, a buffer warehouse must be set up where the goods are needed. It should be located as close as possible to the points of use. Buffer warehouses can be designed as bulk storage (without shelves) or with shelves, e.g., as single-tier shelving, a pallet flow rack system (PDS) with shuttle support, or as a carousel rack system.
Conclusion
Depending on the process step, short-term buffers serve as a reserve between two stages of work and can absorb fluctuations in the workflow, thereby preventing production downtime. There is a direct relationship between the reliability and cost-effectiveness of a buffer stock.
While a small warehouse with few storage locations can be operated more cost-effectively because it incurs lower costs, an insufficient buffer can lead to system downtime. A large warehouse increases reliability, but also raises the costs of setup and operation.