Warehouses are valuable assets but companies are under pressure to make them work harder – and key to success is an efficient storage and retrieval system, says Johanna Parsons.
When is a warehouse not a warehouse? When it’s a distribution centre, of course. To the uneducated, storage may seem to be a passive process. But anyone involved in logistics knows that there’s a whole lot going on in any big shed, and the true value of any DC lies not simply in its size, but in how efficiently stock can be stored and how quickly it can be retrieved.
The high cost of warehouses as well as the dizzying rate of demand in sectors such as retail mean that any storage space counts as an expensive asset that must earn its keep. Storage systems must be efficient and the intralogistics processes must work with the unique challenges of each business to add value to the supply chain.
“Today’s businesses face a unique combination of challenges in terms of supply and demand which determine their choice of storage and retrieval system,” says Martin Willmor, managing director UK&I at DHL Supply Chain.
“E-commerce has completely changed the logistics landscape,” says Shane Faulkner of Swisslog. “Where retail warehouses once involved collecting products together onto a pallet before shipping to a store, they now require the ability to ship single items direct to the customer.”
Mike Holton of TGW agrees that e-commerce is putting a focus on storage and retrieval. “This is really the cutting edge of where technology is being deployed today. The majority of businesses involved in satisfying e-commerce need storage and retrieval systems that can deliver stock totes/cartons at high speed, to goods to person stations (GTPs), that can facilitate high picking rates.
“This need is driven by the increase in single unit picks for delivery to individual customers as opposed to the requirement to batch pick for deliveries to stores. Again, high speed shuttles and intelligent GTPs are in great demand,” says Holton.
The boom of e-commerce has been a game changer, forcing retailers to up their service levels, speeds and sophistication. Even after a brief dip in its rate of acceleration the general trend is still for more retailing online, and so the pressure is still on.
Willmor says: “In November 2018, e-commerce purchases exceeded 20 per cent of total retail spending for the first time. This growth brings with it new opportunities; however, challenges are also emerging – the largest being the consumer expectation for free delivery and returns.”
“An effective storage and retrieval system needs to be flexible, able to respond to changing demands and requirements, and be capable of managing inbound supply. As a result, logistics suppliers are having to adapt and embrace new technology, which lowers costs and improves efficiencies, at a faster pace than previously seen. For any logistics supplier, it is crucial that end to end flows are fit for purpose and back-end supply capabilities support retailer’s front-end customer promises,” says Willmor.
“Customer demand may be changing, but the goal of storage and retrieval technology remain the same – to provide a fast, accurate and efficient way of moving and storing products in a busy warehouse environment. One of Swisslog’s most popular automated storage and retrieval systems is AutoStore… we have implemented over 130 systems,” says Faulkner.
“Compact, modular robotic systems bring a new degree of flexibility to these fulfilment operations. Goods-to-person picking solutions like Swisslog’s CarryPick not only increase the productivity of current personnel, it provides the flexibility to extend work shifts by having robots stage orders before human workers arrive on the job.”
Willmor says that automated storage and retrieval systems (AS/RS) still form the basis of most of high end automated DCs. “We’re seeing businesses – in particular, in the retail sector – investing in automated storage and retrieval systems to hold and automatically move pallets according to requirement,” but he says the key lies in how these are connected to the rest of the intralogistics system, “the most significant development in storage and retrieval technology has been the integration of automated systems.”
And he describes DHL Supply Chain’s advances in collaborative robots as the latest stage in integrating flexible automation. “With collaborative robots equipped with high-resolution cameras, pressure sensors, and self-learning capabilities, they make moving from single to multi-order picking a more efficient and ergonomic process to help track complex movements,” he says.
“At DHL, we’ve invested in indoor robotic transport and assisted picking robots, which follow pickers through the warehouse and take care of most of the physical work. We have also purchased four collaborative robots and integrated them into our co-packing and production logistics centres, as first step of our wider robotics programme. Their ability to undertake a range of repetitive tasks on a variety of products and up-and-down-scalable nature will help us fulfil e- commerce orders more efficiently and respond more effectively to peaks in demand,” says Willmor.
Of course all the latest state of the art equipment will give fantastic results, but the decision to invest in such equipment requires a considered approach, with many finely balanced factors, not least cost.
“Low-level automation or ‘mechanical’ solutions, such as carton and pallet live storage, will strike the right balance between investment, density and speed for fast moving goods picked on a first in, first out (FIFO) basis,” says Edward Hutchison, managing director of BITO Storage Systems.
“Minimal occupation of floor space is also critical in omni-channel retail facilities. These operations require a large number of pick spaces for a broad range of SKUs and will be handling a mixture of slower and faster goods – often all in a single system. Adaptable solutions are required. Here again, live storage provides a lower cost ‘mechanised’ dense storage alternative to fully automated storage and retrieval,” says Hutchison.
For operators who are ready to explore investing in sophisticated systems but who are put off by the idea of a huge capital outlay, TGW’s Holton says: “The question every supply chain director and every finance director should be asking is what return on investment can we achieve by using proven sophisticated technology. None of this technology is inexpensive, but it can bring massive step changes to businesses operations and their eventual bottom line, if deployed in the right environments.”
With the right design at the outset, there is also the option for a logistics operation to take a bit-by-bit approach to high end investments. Swisslog’s Faulkner points out that modular systems allow resources such as robots to be added to a system as it grows. “Modular robotic systems give the flexibility to size the system to current needs and add modules as required. This reduces initial capital expense and allows future automation costs to be shifted from the capital equipment to the operating budget.”
For example, Swisslog’s CarryPick is an AGV-based storage and order picking system. A group of mobile vehicles navigate via a grid to deliver mobile racks to workstations. “This completely changes the concept of a warehouse, and decreases the risk of workplace accidents involving forklifts. Many CarryPick customers find they can increase pick rates by as much as 50 per cent, reducing the need to supplement staff during peak seasons,” says Faulkner.
KNAPP’s pocket sorter is another modular solution, as used by fashion retailer ASOS at its Barnsley and Berlin distribution centres. Along with KNAPP’s OSR Shuttle Store and Pick It Easy work stations, sortation and buffer storage is handled by transport pockets combined with a hanging goods system. The pocket sorter system uses a unique algorithm to sort randomly picked items into an exact sequence. Flat-packed and hanging goods are consolidated at one of 200 packing stations in the precise sequence needed for dispatch.
Heimo Robosch, executive vice president of KNAPP, says: “At the pack stations, we only provide the items that belong to one individual customer order for picking from the pockets. The next order then arrives once the previous pack order has been completed. The streamlining of all processes results in a reduction in costs as well as an optimised transit time, both crucial to e-commerce businesses.”
ASOS added a fifth pocket sorter module and a dynamic buffer storage system to its Barnsley DC last year, to allow the fully automatic storage and retrieval of about 80,000 single items.
Willmor says that there are ways of accessing the benefits of even the most high scale automation without necessarily committing to a huge purchase. “Robotics are still a relatively high investment but there are models – like the one we operate at DHL – where customers can effectively ‘rent’ robots. Semi-automated crates, robotic shuttles, automated mini-load and sortation systems, and auto-packing are just some of the solutions which we provide to allow our customers to benefit from automation without the need for significant capital investment.
“In addition, while it can take six to seven years for businesses to see a return on investment from full scale automation projects, more tactical and stand-alone automated solutions, such as collaborative robots, can pay back in as little as 18 months. Ultimately, a business needs to prioritise where to invest capital and the successful companies of the future will be those which take advantage of new technologies,” says Willmor.
With the latest developments in technology from fully automated storage and retrieval systems, to AGVs and robotics, accessing stock can also mean accessing added efficiency. And with the different ways to buy in to these systems there are more ways than ever to squeeze extra value from the work going on inside the warehouse.
AS/RS enabled next day delivery
Italian electrical wholesale distributor Elettroveneta has chosen Daifuku to deliver an automated storage and retrieval system at its main distribution centre in Tribano, Italy.
The company holds some 30,000 SKUs and faces an increasing challenge to ensure that its customers from the electrical trade can receive the parts they need for the following day’s work.
During peak time, in the late afternoon when electricians are finishing their day’s work, demand rises to 500 orders per hour hitting the order pickers. The firm offers next day delivery on orders placed as late as 7.30pm. To ensure that these products can be picked and despatched, Elettroveneta engaged Daifuku to provide an automated storage and retrieval system (AS/RS) with goods to person picking to enable it to cope with the peaks created at critical times of the day.
Daifuku will supply its Shuttle-Rack M, with three “double-deep” aisles approximately 90 metre long and each with 19 levels of storage, giving capacity for more than 37,000 totes to be held in the AS/RS. Totes will feed out to six picking stations with orders being picked into target totes and part-picked totes being returned to the AS/RS.
A conveyor system will extend from the goods receiving area to transport totes either to the AS/RS for storage or to by-pass the AS/RS for cross-docking.
The system will be designed to enable a fourth aisle of Shuttle Rack M and two additional picking stations to be introduced as volumes continue to grow. Installation of the AS/RS commenced in early 2019.
Electronics firm plugs in the OSR Shuttle EVO
Family-owned electronics company, Schukat, was the first customer to invest in the latest evolution of KNAPP’s shuttle storage technology, OSR Shuttle Evo. The company is based in Monheim am Rhein, Germany and it decided to upgrade its logistics to future-proof its operations.
The company wanted to digitalise all its supply chain processes, to integrate with end-to-end IT. Schukat had already digitalised many areas of its business allowing it to double its turnover since 2009 while the number of employees has remained at around 180.
The firm identified that speed and precision are of utmost importance in the storage and shipping of its range of 35,000 products. It’s pickers had been walking an average of 8-10 km per shift and the firm realised that to develop further without automation they would have to cover an impossible 15-20 km.
In the initial planning stages, there was some debate about which path to take. Thomas Reichmann, assistant to Schukat’s managing directors, says “When we decided to automate, the question was – stacker crane or shuttle? At first, we thought the shuttle system would be too expensive, but then during discussions we realised how to evaluate the economic end of things.”
Flexibility was a key factor in the decision to opt for KNAPP’s OSR Shuttle Evo. “The real challenge,” says owner Georg Schukat, “was how to plan ahead for 15 years. We don’t know what the business will look like in 15 years. This is why it was necessary to have a flexible overall solution, regardless of the system.”
Other factors that Schukat valued were system availability and scalability. As every shuttle can reach every level, there is no single-point-of-failure with OSR Shuttle Evo. In addition, the elimination of the “pre-zone” means that only the storage area has to be expanded, making modification during on-going operation relatively quick and easy.
Schukat also constructed a warehouse larger than its current needs so that planning issues were eliminated from any future expansion.
According to KNAPP, OSR Shuttle Evo is higher, faster, more flexible and more economical than ever. Its streamlined system design makes optimal use of space and the solution makes investment scalable. As well as handling various types and sizes of container with ease, the system features an energy-efficient design and energy recuperation technology.
Putting away the pints
AB InBev is opening a new automated warehouse with space to store 23 million pints of beer at its largest UK brewery in Magor, South Wales.
The warehouse technology was delivered by Portuguese automated material handling specialists, Consoveyo.
The brewer plans a global roll-out of the warehouse technology, making Wales the starting point for the technology expected to cut its carbon impact.
The 80,000 cubic metre warehouse will enable AB InBev to meet growing UK demand for beer brands, including Stella Artois, Budweiser, Bud Light and alcohol-free Budweiser Prohibition.
Robotic cranes operating across six stories and nine miles of racking will be able to retrieve any one of the stored pallets in under 60 seconds.
The firm estimate that the new equipment reduce the brewery’s carbon footprint by 605 tonnes of CO2 by reducing transport between warehouses.
Lloyd Manship, brewery manager for AB InBev said: “This investment demonstrates our commitment to Wales. It means we can get our beer out and into stores and pubs faster and more efficiently than ever before, that’s ultimately good for us, our customers and the environment.”
This article first appeared in Logistics Manager, May 2019.
