Visit to a major distributor

Yesterday, I spent some time with a major distributor in the Oconomowoc, WI area. This very large facility of 1.1 million sq. ft. impressed me but not for the typical reason.

See the expectation when visiting a plant this size is in the seeing of the automation running the facility. When a company is receiving 300 trucks per day and moving out 155 outbound trucks, you would expect that automation is at the highest levels.

One additional fact which would lend this thought, was the fact brought up right away that of the 167 doc doors, they use these doors for both receiving and shipping. Making things more complex, they have two different modes of storage in cool and dry deliveries. According to the managing staff, the consultants that were brought in highly recommended against the idea of using split purpose receiving docks. One got that opinion that the consultants were not very highly regarded at that time because to the credit of this company, they were ignored. Would be good to know who they were….

Back to the discussion, so when I found out that they had no automation and no conveyors, but understood they were handling this product through the warehouse, I was impressed. What seemed to make the big difference for them was the VDP (voice directed picking) they had implemented.

The plant is running standard barcode and labeling on the receiving side of things using EXE as their WMS backbone. The goal of the receiving function is to get a truck in and unloaded within 2 hours of arrival. This helps them shut down the reffers in the trailers and save diesel fuel in parked trailers. The cold storage in the facility being much more efficient and the price of diesel where it is at makes all the sense in the world.

Once received and put away, the plant then starts the staging process for outbound trucks. All of this picking is orchestrated on a last in first pick to the given dock door via VDP. The VDP units they are using are the VOCORDER belt units. These units help them have a hands free pick environment. They are using check digits on the locations, and eliminating the need for barcode scans. By using this system, they have had a 99.8% accuracy in the pick.

The pickers are hand wrapping the pallets as they go, which helps eliminate pallets blowing up in the aisles, therefore also eliminating the need to run everything through a central wrap machine. As they move the pallet to stage, a destination label is placed on two sides of the pallet, and dropped in close order at the staging door.

My guess is they are using a wave type picking arrangement based on the general operational flow.

The loader then loads the pallets as a single carton onto the truck in proper stop order.

Nearly all the units in the place were electric and they had very little counter balance trucks. Their top rack was 34 feet high so they had quite a few high pickers.

With all those batteries, they have moved to a central battery station with semi-automated battery changing and charging. By having extra batteries, they allowed each battery to have some settle time. This has moved their battery life from 4-5 years to 6-7 years. At $3000+ per battery, this is significant cost savings over the long run. They were also able to create a negative air flow around the batteries so the sulfuric gas and hydrogen smell was vented externally to the building.

Trucks were being planned via Manugistics and they had a full dispatch staff and area for their 90+ drivers. Over the road drivers even had a lumper service if they desired.

They even had a semi-full service garage for the trucks and trailers including fuel and wash bay. Very nice.

The biggest opportunity I saw for them was the deadhead miles. While they were getting 50-60% returns on the backhaul, I think they are looking for the right opportunity to move additional freight and improve their efficiency.

Overall I was very impressed.