Today’s warehouse operators face a rapidly changing marketplace driven by e-commerce and consumer demand. The coronavirus pandemic served as a catalyst for greater e-commerce adoption and expedited delivery—often same day. And, growth in diverse SKUs requiring various storage environments from ambient to refrigerated to freezing means greater synchronization between customer demand and warehouse fulfillment. However, choosing the appropriate storage solution is critical to executing on order fulfillment strategies.
However, knowing what is appropriate for your operation requires due diligence. For a storage solution to bare efficiency and productivity gains, means evaluating your operation and understanding your inventory mix.
Profile data. Don Ponticello, regional manager for SSI SCHAEFER, says it’s essential to understand your data and warehouse profile of the actual load units—containers, pieces, and parts—you need stored, and the velocity of those units.
• What are the dimensions of the product(s) being stored?
• Which items are selling the most and least in the warehouse?
• Can a single location accommodate product inventory or are multiple locations necessary?
• Can you replenish the item with next-day delivery or is it coming from overseas?
While these are essential questions, Ponticello says many warehouses struggle to answer them. Knowing the size and attributes of items for storage is essential to choosing the proper storage technology. And one size does not fit all.
“Placing all your inventory in one type of storage media is one of the worst decisions,” says Ponticello.“Picking inner packs on a pallet rack means using vertical-lift equipment and a safety harness to access a pallet,” he says. “Productivity decreases significantly with the extra movement because it’s the wrong storage technology.”
Footprint. With most warehouses storing over 10,000 SKUs, space utilization is crucial to inventory management and order fulfillment. Are pallets sitting on the floor between aisles? Is there space between containers in the rack bins? Does the warehouse have underutilized vertical space?
Every available cubic foot is potential revenue and cost savings. According to Robotics Business Review, “The spatial savings from reduced warehouse footprints can be up to 85% and reductions in operational costs of up to 65%.” Thus, having a dependable and efficient storage solution is critical to achieving those cost reductions and overall warehouse fulfillment effectiveness.
How storage solutions flow to picking and shipping areas (via conveyors or automated guided vehicles) can also affect footprint efficiency. A warehouse is a moving structure where every gap, corner space, and ceiling height must be optimized.
Labor force. Labor can account for nearly 50% of total warehouse operating costs. In today’s market, competent labor can be difficult to secure. Warehouses rely on employees who have technological knowledge to operate sophisticated semi- and fully automated solutions. Automation itself can lower labor requirements by 60%. When deciding on a storage solution, warehouse operators must evaluate how and when they utilize their labor. How do shifts compare to peak hours or seasons?
With most storage solutions being automated, operators can streamline picking and shipping processes by keeping human labor stationary. For example, rather than workers traversing the warehouse, automated guided vehicles can transfer loads from an ASRS to human picking or kitting stations.
Poor throughput. A warehouse with poor throughput experiences bottlenecks. Remove congestion and redundant tasks with storage solutions that create smooth material flows and order efficiencies. Use of conveyers with storage solutions can minimize the handling of orders can increase your peak throughput significantly. If synchronization occurs among footprint utilization, order accuracy, and labor management, it amplifies throughput efficiencies and rates.
Identifying warehouse inefficiencies is vital to implementing a storage solution that addresses these issues, while providing a value add to the order fulfillment process. The choice of storage solution depends on several factors that are unique to every warehouse facility.
What storage solutions are right for your warehouse operation? Consider the following storage solution options as part of your order fulfillment strategy.
Pallet Racking. Gain warehouse efficiencies by moving pallets stored on the floor to pallet racks for higher density. Where floor pallets can stack two or three high, a pallet rack provides nearly twice the storage capacity.
The following are benefits of pallet racking systems:
• Product compatibility
• In-house production—one-stop shopping
• High quality, flexible, and robust
• Sophisticated product range to cover all requirements, including heavyweights
“With pallet racking, operators can do letdowns where you replenish product from above and the ground floor is picking,” says Ponticello. “If I have a pallet rack versus floor-level block storage, I have full access to all the SKUs as opposed to picking pallets with a forklift to access the next one.”
Vertical Lift Module. Vertical lift modules (VLM) decrease storage footprint by housing shelves vertically in an elevator-like system. By compressing what could be unused space in a facility, overall storage increases.
A VLM is ideal for a facility’s B and C items (small boxes or components) 16 inches to 12 inches or lower in height. This storage technology can increase picking times over a standard storage shelf by three to one and reduce the required labor by three to one as well.
The technology brings orders down to a very narrow pick area. For example, an employee may need to walk 130 to 140 feet of shelving for order picking. A VLM reduces that space to as small as 14 to 20 feet—a significant reduction in walking time.
On average, a facility can complete 100 lines per hour with a vertical pick module.
The following are benefits of a VLM storage solution:
• Lean warehouse processes (picking and replenishment)
• Eliminates unnecessary work steps
• Easy integration into existing procedures
• Minimal errors
• Scalability
“Create several locations on the shelf as dedicated storage space for small items in bins,” says Ponticello. “We see many companies with a beam eight-foot wide by 42-inches deep housing 100 items, but no distinct storage location,” he says. “Operators find themselves looking all over for items because an employee doesn’t return an item to its original location.”
Miniload system. On a larger scale from a VLM are miniload systems. These vertical, space-optimized storage solutions are ideal for small unit loads.
An advantage of miniload systems is the ability for single- or multiple-depth options, providing greater storage density.
Automated cranes or shuttles retrieve items in a variety of storage types, from containers to cartons to trays. Maximize the storage and retrieval process and reduce the necessary labor by pairing a miniload system with conveyers or automated guided vehicles to picking stations.
The following are benefits of a miniload storage solution:
• Fully automated operations using storage-retrieval machines and shuttles
• Short access and delivery times, suitable for e-commerce
• Optimum space utilization
• Single or multispacer storage
• Reduced personnel costs
Mobile Racking. A mobile racking system provides the advantage of space optimization and flexibility. Regardless of the size and quality of the stored goods, a mobile racking system can accommodate a variety of order types.
With adjustable rack aisles and higher storage capacity, mobile racking provides barrier-free warehouse space and work areas.
The following are benefits of mobile racking systems:
• Increased storage capacity up to 90%
• Space savings of up to 45%
• High efficiency and durability
• Possible combinations with conveying system and automated guided vehicles
“Mobile racking will open and close where you need to go in, shortening the distance to access a specific pallet,” says Ponticello. “The travel distance is reduced significantly.”
A major decision that operators have is balancing their choice of storage solution with the future needs of the warehouse. Ponticello says operators must consider whether they’re increasing in growth of orders, SKUs, or volume, and if they’re in acquisition or consolidation mode. If an operator buys a competitor with the same product lines because it’s cutting into market share, how does that affect the warehouse operation? The decision could be to discontinue the same or similar product offerings, causing a potential increase in orders by 20%. Will that also lead to an increase in SKUs and volume? There are several scenarios to consider.
“Ultimately, how do these scenarios affect what an operator has to buy in storage equipment?” says Ponticello. “Often, the volume will increase resulting in the need to store more pieces, cases, or pallets.”
To make sure that your supply chain operations is storing correctly, speak with an SSI SCHAEFER warehouse expert today. Speaking with an expert can ensure that the storage solutions that you choose today can scale with your warehouse tomorrow.
Links:
https://www.roboticsbusinessreview.com/research/the-top-50-warehouse-automation-companies-2020/
https://multichannelmerchant.com/blog/15-ways-improve-warehouse-space-utilization/
https://www.thebalancesmb.com/maximizing-space-utilization-2221378