Warehouse & Distribution Management
WAREHOUSE (RE)DESIGN
Breda, 13-03-2012
Groenewout Ref nr. 9015X012/WD/ld - version 1.0
Wendel Dijker
The recommendations, advice and conclusions, mentioned in this report, are based on the information and data provided by client.
Savings, operational costs and investment estimates are depending on the assumptions and preconditions stated in this report.
Profile Groenewout
Founded in 1966, Groenewout provides
professional consulting in Logistics and
Supply Chains Management.
Our core competence has been sharpened in supply chains optimization and detailed designs of manufacturing-,
distribution- and fulfillment centers. We place a great deal of emphasis on both the identification and realization
of feasible opportunities.
Page 2
Our consulting service portfolio
Page 3
Our consulting methodology
MULTI-DISCIPLINARY
Groenewout’s team consists of highly qualified
business consultants with unique, complementary
disciplines.
HANDS-ON
More than 40 years of experience in operational
environments & implementation processes.
INDEPENDENT
Groenewout has no formal obligations towards
suppliers or contractors whatsoever and always gives
an independent advice, keeping the interest of the
client as a first priority.
INTEGRITY
Groenewout highest value is integrity, externally
towards client organizations and their employees and
internally towards Groenewout employees.
PROFESSIONAL
• Quantifiable: Quantification is the basis for our
advice.
• Quality: Highly qualified professionals with more
than 150 years of logistics experience.
• Leading edge expertise: Groenewout strives to
maintain a leading position as a Logistics and Supply
Chains Management specialist, creating a continuous
learning environment to develop the organization
and the individual.
Page 4
Quality measured by our clients
(Fine) Chemicals
Healthcare
Electronics
3rd-Party Logistics
Service Providers
Fast Moving
Consumer Goods
Page 5
And many other industries
Content
1
Introduction
2
Muther‘s Method &
Basic Data Document
3
Warehouse concept
4
Evaluation
Page 6
1 Introduction (1)
Supply Chain Structure
Supply Chain Management
Assets
& facilities
Sourcing
Manufacturing
Warehousing &
distribution
Transportation
Page 7
Customer
1 Introduction (2)
Company strategy
Logistics strategy
Operational concept
Logistics process
Logistics design
requirements
Information
system
requirements
Building requirements
Page 8
Organization &
communication
requirements
1 Introduction (3)
Facilities
Realize
Controls
Logistics
Organization
Processess
•Organization matrix
•Processess
•Workinstructions
•Racking
•MHE
•Conveyors
•WMS
•Interfaces
•Building
•Building related installations
Page 9
Design
1 Introduction (4)
Quantitative
Qualitative a/o
Flexibility
Building
and facilities
costs
Labor
costs
Risk
Minimize
warehouse
costs
Quality
Logistic
equipment
costs
Efficiency
Page 10
2 Muther’s Method & Basic Data Document
Approach
Product:
Which
Products?
Quantity:
What are the
quantities?
Route:
Which
route?
Systems:
What
supporting
System?
Time:
What is
the time
period?
Muther’s
method
Classification of materials
Quantification of goods flows
STOP
Selection of storage and handling method
Alt. A
Alt. B
Alt. C
Evaluation of alternatives
Choice and engineering of alternative
Page 11
Collect and bring all the
relevant
information (PQRST) in
Basic Design Document (BDD)
3 Warehouse Concept
Main Topics
A
Storage Systems
B
Handling Systems
C
Overview
D
Order Picking Method
E
Order Picking Techniques
F
IT
Page 12
3A Storage Systems
Storage
systems
Handling
systems
Optimal
Warehouse
Concept
Picking
method
Picking
technique
Page 13
3A Storage Systems
General
Storage systems can be divided into systems for:
• Pallet items
• Small items
• Long goods
• Others
Page 14
3A Storage Systems
Pallet Items (1)
Block stacking
Page 15
3A Storage Systems
Pallet Items (3)
Pallet racking - Wide aisles
Page 16
3A Storage Systems
Pallet Items (2)
Pallet racking - Narrow aisles
Page 17
3A Storage Systems
Pallet Items (4)
ASRS or Pallet retrieval
Page 18
3A Storage Systems
Pallet Items (5)
Pallet flow racking / push back racking
Page 19
3A Storage Systems
Pallet Items (6)
Drive-In racking
Page 20
3A Storage Systems
Pallet Items (7)
Pallet racking with satellite
Page 21
3A Storage Systems
Pallet Items (8)
Movable racking
Page 22
3A Storage Systems
Small Items (1)
Static Shelving
Page 23
3A Storage Systems
Small Items (2)
Dynamic shelving
Page 24
3A Storage Systems
Small Items (3)
Case flow racking
Page 25
3A Storage Systems
Small Items (4)
Picking
Tray
System
Mini load
Page 26
3A Storage Systems
Small Items (5)
Paternoster/lift
Page 27
3A Storage Systems
Long Items (1)
Block stacking
Page 28
3A Storage Systems
Long Items (2)
Block stacking
Page 29
3A Storage Systems
Long Items (3)
Cantilever racking
Page 30
3A Storage Systems
Long Items (4)
Automated system with cassettes
Page 31
3A Storage Systems
Long Items (5)
Vertical stacking on pins
Page 32
3A Storage Systems
Summary (1)
Storage systems can be divided into systems for:
• Pallets
• Small items
• Long goods
• Other:
• Hanging garments
(see pictures)
• Odd sizes, like
• Bikes
• Seats, couches
• …
Page 33
3A Storage Systems
Summary (2)
storage system
Stock per
article
Number of
articles
Space
utilization
orderline /
Investment
stock rate
L
L
L
L
A
H
A
H
A
H
A
H
L
Block stack
Wide aisles
Narrow aisles
AS/RS pallets
Pallet flow racks
Shelves
Case flow racks
Mini-load
Paternoster
Carrousel
L
Low
A
Average
H
Categorization and criteria storage systems
Page 34
High
A
H
Storage
unit
L
A
H
Flexibility
L
A
H
3A Storage Systems
Summary (3)
High level comparison pallet systems
Storage Systems
Block Stacking
Picking Systems
Pallet Flow
High Bay
Block Stacking
Pallet Drive-In
Pallet Drive-In
Pallet Flow
Pallets Racking
(Wide Aisle)
Pallet Racking
(Wide Aisle)
High Bay
Pallets Racking
(Narrow Aisle)
Pallet Racking
(Narrow Aisle)
Fine picking
Cases or eaches
# SKU
Page 35
Bulk picking
Pallets
3A Storage Systems
Summary (4)
High level comparison small article systems
Storage Systems
Picking Systems
A-Frame
Pallet Racking
Case Flow
Pallet Racking
Case Flow
A-Frame
AS/RS Mini load
AS/RS (Mini load)
Shelving
Shelving
Carrousel
Paternoster/lift
Paternoster/lift
Fine picking
(Eaches)
# SKU
Page 36
Carrousel
Case picking
3B Handling Systems (1)
Storage
systems
Handling
systems
Optimal
Warehouse
Concept
Picking
method
Picking
technique
Page 37
3B Handling Systems (2)
Electrical Pallet Truck
Hand Pallet Truck
Page 38
3B Handling Systems (3)
Customized pick cart
Pick cart with P-t-L system
Page 39
3B Handling Systems (4)
Roll container/ Dolly
Page 40
3B Handling Systems (5)
Forklift truck
Page 41
3B Handling Systems (6)
Horizontal order pick truck
Page 42
3B Handling Systems (7)
Vertical order pick truck
Page 43
3B Handling Systems (8)
Reach truck
Page 44
3B Handling Systems (9)
Combi truck or high bay truck
Page 45
3B Handling Systems (10)
Conveyor systems
Page 46
3B Handling Systems (12)
Mini load cranes (ASRS)
Page 47
3B Handling Systems (13)
Pallet cranes (ASRS)
Page 48
3B Handling Systems (14)
Side loaders
Page 49
3B Handling Systems (15)
AGV (Automated Guided Vehicle)
Page 50
3C Overview
Characteristics for main concepts
Cost for Space
Concept
Storage method
MHE
Blockstack
Floor
Forklift truck
Wide aisles
Pallet racking
Reachtruck
Narrow aisles
Pallet racking
Combitruck
AS/RS
Pallet racking
SBA
Pallet flow racks
Pallet flow racks Orderpick truck
Pallet flow racks ptb
Pallet flow racks Pick-to-belt
Shelves
Shelves
Trolley
Shelves ptt
Shelves
Pick-to-tote
Case flow racks
Case flow racks
Trolly
Case flow racks ptt
Case flow racks
Pick-to-tote
Miniload
Case racking
Miniload crane
L
A
L
Low
Page 51
H
Equipment
cost
Labour cost
L
A
A
Average
H
L
A
H
H
High
3D Picking Method (1)
Storage
system
Handling
system
Optimal
Warehouse
Concept
Picking
method
Picking
technique
Page 52
3D Picking Method (2)
Picking methods
•
Pick cart, roll container
•
Electrical pallet trucks, 1 or more pallets
•
(horizontal/vertical) order pick trucks, combi trucks
•
Pick-to-belt
•
Pick-to-tote
•
Pick-to-shipping box
Page 53
3D Picking Method (3)
Pick cart
Page 54
3D Picking Method (4)
Roll container/ Dolly
Page 55
3D Picking Method (5)
Horizontal order pick truck
Vertical order pick truck
Page 56
3D Picking Method (6)
Combi truck
Page 57
3D Picking Method (7)
Conveyor belt: pick-to-belt
Page 58
3D Picking Method (8)
Roller conveyor: pick-to-tote (zone picking)
Page 59
3D Picking Method (9)
Roller conveyor: pick-into-shipping box (zone picking)
Page 60
3E Picking Techniques (1)
Storage
system
Handling
system
Optimal
Warehouse
Concept
Picking
method
Picking
technique
Page 61
3E Picking Techniques (2)
•
Paper pick list
•
Collo-labels
•
Goods-to-Man
•
RF and scanning
•
Pick-to-Light
•
Voice Recognition
•
Full automated picking (A-frame)
Page 62
3E Picking Techniques (3)
Handling concepts
•
Man-to-goods
•
Goods-to-man / automatic storage
•
Goods-to-man / hybride
(e.g. wide aisles, narrow aisles)
(e.g. AS/RS, paternoster)
(e.g. pick-to-tote/carton, pick-to-belt)
Advantages goods-to-man vs. man-to-goods
•
Higher productivities
•
Less picking errors
•
Better space utilization
•
Ergonomic working stations
Disadvantages goods-to-man vs. man-to-goods
•
Higher investments
•
Less flexibility
•
Limited capacity
Page 63
3E Picking Techniques (4)
Multi-order picking (sort-while-picking) by P-t-L on pick cart
Page 64
3E Picking Techniques (5)
RF picking & scanning
Page 65
3E Picking Techniques (6)
Pick-to-Light
Page 66
3E Picking Techniques (7)
Voice Recognition
Page 67
3E Picking Techniques (8)
A-frame
Page 68
3E Picking Techniques (9)
Page 69
3E Picking Techniques (10)
Cost for Space
Concept
Storage method
MHE
Blockstack
Floor
Forklift truck
Wide aisles
Pallet racking
Reachtruck
Narrow aisles
Pallet racking
Combitruck
AS/RS
Pallet racking
SBA
Pallet flow racks
Pallet flow racks Orderpick truck
Pallet flow racks ptb
Pallet flow racks Pick-to-belt
Shelves
Shelves
Trolley
Shelves ptt
Shelves
Pick-to-tote
Case flow racks
Case flow racks
Trolly
Case flow racks ptt
Case flow racks
Pick-to-tote
Miniload
Case racking
Miniload crane
L
A
L
Low
H
Equipment
cost
Labour cost
L
A
A
Average
H
L
A
H
H
High
Focus off integrated systems like Direct Picking System, Order Distribution System, Order Storage
and Retrieval en Horizontale Carrousels with sufficient volume
Page 70
3E Picking Techniques (11)
1.000
p
i
c
k
r
e
g
e
l
s
900
800
700
p
e
r
600
u
u
r
500
p
e
r
400
p
e
r
s
o
o
n
300
200
100
Manueel
M2G
DPS
Horizontale
Carrousels
Page 71
OSR
ODS
3F IT
General concept (1)
Purchase Orders
Confirmation
S
Y
S
T
E
M
S
Sales Orders
Confirmation
ERP system
Supplier
System
WMS
Repair
WMS
LSP
Repair
Center
LSP
CRM
system
WMS
Retailer
F
L
O
W
S
Production
Stock
At supplier At supplier
Own
Warehouse
Page 72
Retailer
Or Shop
Customer
3F IT
General concept (2)
ERP
ERP
ERP
ERP
WMS
Production site
Warehouse
Warehouse
Page 73
3F IT
Warehouse Management & Control System (3)
Warehouse Management System
Warehouse Control System
PLC Miniload
PLC Sorter
PLC Sorter
RF
RF
RF
VAS
Receiving
Page 74
RF
4 Evaluation (1)
Operational Handling
Concept
Decrease errors
Decrease lead time
Ordering day X 
Delivering next day
‘zero defects’
Maximize of
consolidation
Minimize of
operational costs
Possibility of
Modular systems
‘same day deliveries’
Page 75
4 Evaluation (2)
Operational costs
Layout drawings &
concept drafts
Concept
description
Migration
plan
Project plan
realization
Investments
Operational
FTE calculation
Handling
Concept
Sensitivity
analysis
Page 76
Capacity
calculation
Performance
guarantee
4 Evaluation (3)
Financials
•
Logistics performance
• Investments (CAPEX)
• Conceptual concept
• Operational costs (OPEX)
• Headcount
• ROI
• Reliability
•…
• Flexibility
• ……..
Requirements
Risk
• Sensitivity
• Fullness
• Techniques dependency
• Conformities basic data
• Fall back scenario's
•…
• Risk of execution
• Timeline of realization
•…
Criteria
Weighted
Score per concept
factor
Financials
..
Logistics performance
..
Risk
..
Requirements
..
1
…
Total Score
100%
Page 77
2
3
4
CONSULTING, ENGINEERING
&
OPTIMIZATION IN LOGISTICS NETWORKS