Automation in the Distribution Center Technologies and Systems You Should Know About

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1 Track: 606 Automation in the Distribution Center Technologies and Systems You Should Know About Marc Wulfraat, MWPVL International Inc. (514) x 100 Marc.wulfraat@mwpvl.com May 23, 2007 DC Expo Session 606 Page 1

2 Session Focus This session will help companies to understand new automation technologies within the distribution center, the leading edge solutions that are available, their application, cost and where they make the most economical sense. This Presentation is Geared Towards: Goal: Cut Costs Your Role: Industry Consultant Goal: Handle Growth Your Role: Executive Goal: Increase Productivity Your Role: Strategic Facility Design Covered Topics in End-to-End Supply Chain Model: Executive Decision-Making Logistics/Fulfillment Sourcing Connecting Tech/Resources Making/Manufacturing All May 23, 2007 Session 606 Page 2

3 Abstract Material handling equipment automation solutions for: Each Picking Carousel Replenishment Sortation De-palletization Case picking Storage Palletization Labor Incentives Movies and images of automated and semi-automated solutions in NA and Europe. Where each solution fits How much they cost May 23, 2007 Session 606 Page 3

4 What is your attitude towards automation in distribution? It would never apply to my company. It s overpriced, inflexible, constant maintenance headache, it s bound to fail, etc. It s interesting stuff but not on my clock We will use automation but only if it has ROI based on real labor reduction We will use automation to gain a competitive advantage for the long term We will use automation as a labor strategy to combat the unions May 23, 2007 Session 606 Page 4

5 All of These Opinions Are Valid! The application for distribution automation really depends on a company s size, culture, financial governance, labor strategy and risk tolerance. When the planets are aligned, then automation may become reality. May 23, 2007 Session 606 Page 5

6 Automation is Making a Comeback In North America Automation was popular in the 70s In the 80s and 90s automation declined as people realized that labor inflation was not infinite In the past decade the pace has picked up significantly In Western Europe Automation has been more widely used due to shortage of land and labor and higher labor rates May 23, 2007 Session 606 Page 6

7 Sometimes Automation Makes Sense For Other Reasons May 23, 2007 Session 606 Page 7

8 Flex Picker Automated Each Picking (Courtesy Bastian Material Handling) May 23, 2007 Session 606 Page 8

9 A-Frame Order Picking Up to 50,000 units/hr automated pick output Manual replenishment of eaches is required Ideal for small items with hyper-fast velocity and high value Ideal for tight order turnaround time (e.g. 4 hours or less) 3000 SKU system costs ~$2.5M + interface to WMS Justification is typically on the basis of accuracy rather than productivity May 23, 2007 Session 606 Page 9

10 A-Frame Order Picking (Courtesy SSI Schafer) May 23, 2007 Session 606 Page 10

11 Goods to Operator Picking (Courtesy SSI Schafer) May 23, 2007 Session 606 Page 11

12 Automated Replenishment Carousels All received products destined to be stored in the carousel must be placed into standard Containers Never need to be shut down the carousel for replenishment Mini-load machines dynamically replenish the carousels during active picking operations Systems start at $1.5 M and up for 3-Pod station May 23, 2007 Session 606 Page 12

13 Automated Carousel Replenishment (Courtesy SSI Schafer) May 23, 2007 Session 606 Page 13

14 Automated Carousel Replenishment (Courtesy SSI Schafer) May 23, 2007 Session 606 Page 14

15 E-Commerce Order Sortation Batch Pick Many Small Orders and Automated Sort (Courtesy BMH & ASAP) May 23, 2007 Session 606 Page 15

16 E-Commerce Order Sortation (Courtesy ASAP) May 23, 2007 Session 606 Page 16

17 Bomb Bay Sortation Tilt tray sorters cost in the range of $750K+ Budget turnkey price for a 400 drop bomb bay sorter can run from $ Million + Warehouse control system (WCS) Sorters will allow processing of up to 40,000 pieces per hour with up to 12 people inducting product New quad tray technology from Eurosort has doubled the output capacity of these machines May 23, 2007 Session 606 Page 17

18 Bomb Bay Sortation May 23, 2007 Session 606 Page 18

19 Bomb Bay Sortation Books & CDs (Courtesy EuroSort) May 23, 2007 Session 606 Page 19

20 Automated De-Palletization Semi-Automated Automated May 23, 2007 Session 606 Page 20

21 Semi-Automated Case De-Palletization / Case Picking (Courtesy Siemens) May 23, 2007 Session 606 Page 21

22 Automated Depalletization /Case Picking (Courtesy Siemens) May 23, 2007 Session 606 Page 22

23 Automated De-Palletization Key considerations Pallets need to be in full layer quantities (i.e. residual cases can t be automatically handled) If pallets are being de-layered to automate case picking, what happens when you don t need all of the cases in the layer? Where do the residual cases go? High cost fully automated machines are expensive i.e. $2.0M+ May 23, 2007 Session 606 Page 23

24 Automated Full Case Selection Several innovative solutions have emerged to automate and semi-automate case picking Key vendors in this space include: Witron Nedcon Siemens Swisslog HK Systems Daifuku May 23, 2007 Session 606 Page 24

25 Automated Full Case Selection (Courtesy Nedcon - Dynamic Logistics Systems) May 23, 2007 Session 606 Page 25

26 Automated Full Case Selection (Courtesy Nedcon - Dynamic Logistics Systems) May 23, 2007 Session 606 Page 26

27 Automated Case Selection (Courtesy Nedcon - Dynamic Logistics Systems) May 23, 2007 Session 606 Page 27

28 One of the Most Automated Distribution Centers in North America (Courtesy HK Systems) May 23, 2007 Session 606 Page 28

29 Building Attributes Perishable Goods Warehouse 500,000 Square Feet 35 AS/RS aisles with dedicated HK Cranes 25,625 Single Deep AS/RS Storage Locations Dry Goods Warehouse 620,000 Square Feet 42 AS/RS aisles with dedicated HK Cranes 38,500 Single Deep AS/RS Storage Locations 56 Receiving dock doors Clear Height May 23, 2007 Session 606 Page 29

30 Single Deep ASRS Conventional Double Pallet Jack Pick With Voice May 23, 2007 Session 606 Page 30

31 System Safety Features Motion Detectors from SICK for safety requirement (Courtesy HK Systems) May 23, 2007 Session 606 Page 31

32 Turret Fork ASRS Automated Putaway & Replenishment both sides of the aisle by ASRS with rotating forks (Courtesy HK Systems) May 23, 2007 Session 606 Page 32

33 ROI/Benefits/Project Drivers Safer Environment Less Lift Truck Traffic in operating aisles Reduced Labor Force Fork Drivers Reduce Training Time Reduced Product & Rack Damage Increased Inventory Accuracy May 23, 2007 Session 606 Page 33

34 A Few Investment Considerations ASRS Crane ranges in price from $300K - $700K each Project Engineering & Services can be $500K - $1M+ Typically installed in higher buildings up to but also can be installed in existing buildings with lower height In-rack sprinklers required > 40 Height Thicker/Superflat floors required more expensive due to low tolerance of ASRS Racking systems are usually much costlier e.g. $175 per pallet versus $60 per pallet for conventional rack Also need high quality pallets throughout the storage system May 23, 2007 Session 606 Page 34

35 ASRS (Courtesy SSI Schafer) May 23, 2007 Session 606 Page 35

36 Pallet Runner Storage System European concept arrived in North America still relatively new here Alternative to pallet flow through racking Ideal for full pallet environments where few SKUs generate high volume of pallet movement and require dense storage to cut down on space requirements E.g. ideal for manufacturers of frozen food or chilled products (Bread, French Fries) Also can be applicable to some 3PL environments (Courtesy Siemens) May 23, 2007 Session 606 Page 36

37 Pallet Runner Pull pallet from end Load pallet in Front Pallet Runner is similar to pallet flow rack but without the gravity angle Pallets move through the storage lanes by sitting on an automated pallet robot that moves all pallets in FIFO sequence from front to back Storage can be upwards of 30 pallets deep and all aisles are eliminated Budget $175 per pallet for racks & 60K per pallet runner robot May 23, 2007 Session 606 Page 37

38 Pallet Runner (Courtesy Pacific Westeel) May 23, 2007 Session 606 Page 38

39 Pallet Runner Considerations Extra move because the operator needs to insert and withdraw the robot before putting away or picking Battery life Cube loss within the racks Cases falling off of pallets in a 3-deep lane Robot wheel slippage in a moist environment Potential extra end of day labor to shuffle pallets to the nose of the rack May 23, 2007 Session 606 Page 39

40 Palletizer Robots Gantry Arms most common Cost $300K and up depending on the customization of the machine Application is common in environments where many cases of the same SKU need to be palletized Used most commonly to automate heavy case lifting at manufacturing facilities such as in Fresh Meat plants Also used for handling of hazardous goods Also being used for bagged goods May 23, 2007 Session 606 Page 40

41 Palletization (Courtesy Bastian Material Handling) May 23, 2007 Session 606 Page 41

42 Last But Not Least DC automation to incent your work force! (Courtesy Bastian Material Handling) May 23, 2007 Session 606 Page 42

43 Track: 606 Questions & Discussion Marc Wulfraat, MWPVL International Inc. (514) x 100 Marc.wulfraat@mwpvl.com May 23, 2007 DC Expo Session 606 Page 43

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