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Innovation at Work
Increased efficiencies and state-of-the-art technology are benchmarks of today’s warehouse equipment trends
By Lisa White
Back in the 1960s, Jim Apple, a professor at Georgia Tech, led a research group that counted 870 types of equipment used in distribution warehouses.
Today, that number has grown to 2,000, according to Bob Footlik, president of Footlik & Associates, an Evanston, IL-based company providing professional consulting services in materials handling and industrial engineering since 1948.
With all of this new equipment has come innovations and technological advances that help increase efficiencies, as well as reduce costs and labor in the warehouse.
However, some c-store distributors are taking a "wait and see" approach before making a commitment to change. “We don’t use a lot of warehouse innovation,” says Ryan Smith, executive vice president of Dittman-Adams, based in West Chester, OH. “In our view, good layout and design and organizing products is what saves steps and movement, [increasing efficiency].” He adds that, when considering implementing new equipment, there needs to be proof of savings from a financial and/or time standpoint.
When looking at trends in this segment, it is important to be familiar with the types of equipment available and the benefits offered. Footlik says warehouse equipment can be broken down into three categories—equipment for storage, mobile equipment and information or technology.
Equipment for Storage
For the most part, the things that are being advertised and addressed in equipment, such as static storage on shelves and pallet racks, have not changed since 1948, says Footlik. “These units are overdue for a radical change to bring storage in line with our current information handling capabilities,” he says.
The most recent changes in this segment are the introduction of products developed for retail storage. “In the past, if you had a large object, you stuck it on a pallet rack and the small object went on shelving in order not to waste space,” explains Footlik. “Now, new retailing accessories allow stores to co-mingle large and small objects that typically go together. In addition, data systems like bar coding and WMS (warehouse management systems) allow stores to track these relationships.”
In this case, product affinity (where one product goes with another) has created storage affinity. “Intermediate posts allow you to have a pallet storage in the same opening or facing as shelves or carton flow racks,” says Footlik.
He adds that, because c-stores are set up by product family and rarely by product association, there are many areas for improvement. “At the store level, there is little or no back room. So when items arrive on site, there is minimal labor to put product away. People are typically running from one end of the store to the other,” says Footlik. Warehouses that take into account affinities in the store can minimize store labor. “Randomizing is good at the warehouse level, but may be a bad idea for retail customers. If you’re there to service your customer, the fact that you’re putting orders into a format the customer likes is an excellent marketing tool. It also can save time and aggravation at the store level.”
What also can increase efficiencies in the warehouse are more advanced storage solutions. For example, Bill Hubacek, director of distribution technology products for Emeryville, CA-based FKI Logistex, is seeing increased interest in mini roller flow racks. “We see it everywhere we go, and distributors are saying they are worth the extra money,” he says.
While storage solutions save time, reusable containers help save money. Eric Fredrickson, sales and marketing manager for IPL Material Handling, a Quebec, Canada manufacturer of plastic products, says he sees a steady shift from using single-use containers to reusable containers to move product from distribution centers to retail locations. “The area where there is the highest percentage of use with these products is when there is less than full caseload distribution. This is where full cases go into the distribution center and product is divided up into [smaller] reusable containers and then sent to different stores,” he explains.
The driver of reusables, says Fredrickson, is cost savings in eliminating both single use packaging and handling. “This is especially true when it comes to handling empty containers at the store level,” he says.
Another factor affecting the popularity of these containers is that they help decrease labor. “Increased automation is driving more and different types of reusable containers to get labor out of distribution centers,” Fredrickson explains, adding that these containers’ compatibility with RFID technology also has been beneficial. “Distributors can put RFID tags on reusable containers and get multiple uses out of the tag.”
Mobile Equipment and Material Handling
Unlike the minimal changes in storage equipment, mobile equipment, such as forklifts and conveyors, has seen more change. “The biggest change here is intelligence being added to equipment. We find that, on the forklift for example, you now have programs that can be set specifically for the capabilities of the driver,” says Footlik. With these programs, the forklift truck has specific settings for trainees, where they can only go so fast. When they learn to maneuver the truck and stop bumping into things, the driver’s capabilities can be re-evaluated and the truck’s programs can be reset.
In addition, this new forklift equipment reports malfunctions, abuse and utilization. “We are just beginning to develop the management techniques and infrastructure to use data that’s being developed,” explains Footlik.
Dan Belanger, president of Beltech Group, a distributor consultant based in Grand Rapids, MI, says the three trends in material handling equipment are increased safety, improved ergonomics and more environmentally friendly equipment. “The primary focus is human and product safety, especially with today’s government requirements. Ergonomics also is important, and manufacturers are making equipment more operator friendly. Third, due to the cost of certain fuels, we see more electric type devices that are more environmentally friendly and quieter to operate,” he says.
Chad Pilbeam, marketing project manager at Mitsubishi Forklift Trucks, based in Houston, TX, says the company’s forklifts offer more flexibility, address safety concerns and help increase productivity. “We now are including features on our trucks that used to be optional, like engine protection systems and more indicators to help prevent product damage,” he says.
With warehouses building up instead of out due to the high price of real estate, new forklifts have been designed to go to further heights and maneuver in narrower aisles at faster travel and lift speeds, says Pilbeam. “Many customers used to purchase 5,000-pound forklifts for all applications. Now customers are better educated and finding more efficient equipment that offers a lower cost of ownership,” he says.
Increased efficiency also has played a roll in the conveyor segment. “What has taken place over the last few years is distributors’ increased usage and acceptance of 24-volt power conveyor technology. These systems provide both increased energy efficiency and quieter operation. And, instead of having one driver, these conveyors have individual rollers embedded in the motor so there is no noise from the belt,” he explains.
Although picking techniques have remained somewhat unchanged over the years, Hubacek has begun to see a revival of pick-to-light, which enables order pickers to quickly find the location for their next pick using lights and LED displays retrofitted to static shelving, flow racks and other storage media. The lights also display the product amount ordered, requiring confirmation as each item is picked. “This technology has been around for awhile, but a number of c-store distributors have gotten away from it due to the expense. With the cost of these systems coming down in the last couple of years, many companies are revisiting pick-to-light,” he says.
In addition, with many in the c-store business being faced with increasing product breakouts, pick-to-cart systems also have become more prevalent. “This technique is used for slow and medium movers (products), when more than one order is picked at a time using carts that are RF driven,” says Hubacek.
Glacier Computer, based in Amherst, NH, manufactures computers with shock-mounted hard drives that are designed to be used on forklifts for paperless picking. According to John Gary, company founder and vice president, “We bring computer power normally found at desks into the farthest reaches of the warehouse.”
He says what is extremely popular today is putting a computer on every forklift within a warehouse for paperless picking. “Forklift operators would typically use paper to check off items and then drop these forms into a box for someone else to input the information. This is not always accurate and also is slow, inefficient and not timely. Now, forklift operators simply look at the screen and use touch screen technology to enter information. There also is a bar code scanner hooked up to the computer to scan products.” With this system, inventory is adjusted right away. “A side benefit is that this system also allows distributors to generate productivity measurements rapidly because information is garnered instantly on the computer.” Each computer is networked wirelessly to a mainframe via the Ethernet.
Information and Technology
Like mobile equipment, the frontiers for information and technology are endless and have not yet been fully realized, says Footlik. “In the past, we have set up warehouses so all products from vendor A are in vendor A’s aisle. This method persisted until the 1970s and the proliferation of computers,” says Footlik. “Then professors said ‘let’s put the fastest moving items in front of the warehouse and others in order of use. This was because, now, we could use the computer to tell us where everything was whereas in the past you had to remember where everything was located.”
But many are finding this technique to be time-consuming and inefficient. “Now we realize that was not the best setup because, when you have a fast-moving item, you typically sell that with a slow mover,” explains Footlik.
As a result, the proliferation of WMS has made organizing distribution centers easier and less labor intensive. Hubacek says that, because many of today’s WMS programs do not address all of the c-store distributors’ needs, people are writing other programs or ‘middleware’ to help bridge the gap.
Another change brought on by computers is eliminating management by exception. “This is when you only look at a system, method or product if something is wrong,” says Footlik. “With today’s technology, we can track exceptions, establish trends and use computers to alert management when there are both good and bad trends.”
An example is when you have two vendors of the same product, with vendor #1 shipping product on time, organizing orders on the truck, but selling the product at a slightly higher cost than vendor #2. However, vendor #2 takes longer to ship product and is disorganized with its deliveries. “With a management system, you find out what it really costs you to have vendor #1’s product on the shelf—what did it cost to order from him, do business with him and the shelf cost, as opposed to vendor #2, who is hard to contact, is late with their orders and takes more time to put their product away,” says Footlik.
Despite all of the recent innovations, Footlik says warehousing and distribution is still made up of a lot of little tasks that can be further simplified. “The more we examine them, the more we will be aware of exceptions and what they mean in a total system,” he says.
Lisa White is a freelance writer based in Cary, IL. She is former executive editor of Fancy Food magazine and managing editor of Deli Business magazine.
Distributors’ View
As warehouse equipment continues to improve and become more technologically advanced, c-store distributors are taking their time in deciding where to make their investments and what will work best for their operations.
“Our most significant advancement was utilizing a power conveyor as opposed to pushing [product] down the line,” says Dittman-Adams’ Smith. But he admits his company is far from being on the cutting edge where new equipment is concerned. “The old fashioned way works and we’re reluctant to change it,” says Smith.
However, the company has moved forward with upgrading its forklift trucks due to safety concerns. “We went with trucks that offer more in the way of safety equipment,” says Smith, adding that Dittman-Adams also is currently working on initiating remote data entry capabilities for its computers. “We also will expand into using RF (radio frequency) receivers. And we’re looking at routing software, where we scan boxes to monitor which trucks product is on.”
Cory Jackson, president at Capital Distributing in Meridian, ID, says that, although the company redesigned its warehouse a couple of years ago, “We didn’t make any unique or new changes. The computer sector of the industry is where the action is,” he says.
He says the company is now doing RF receiving and is looking to do voice activated picking, “But it’s expensive,” says Jackson. “We are also looking at a new forklift that operates in narrow aisles. It will allow us to pull pallets off of a truck without using special equipment.”
At Idaho Candy in Boise, ID, John Wagers, owner and president, says there is a lot of change happening in electronic ordering. “We’re starting to get more backstock being programmed in when it comes in the door. Now we can scan it in and put it in any location in the warehouse so we know where it is. Also, palm units are coming in and have the capacity to store all of our inventory information so that it’s available to salesmen and customers. And there’s a lot of automation on the computer end with paperless picking, but we haven’t begun exploring that yet.”
The company also is looking into updated storage. “We’ve looked at storage racks that you can make into flow racks by putting runners across them. This lets you store more inventory without using more dedicated space,” says Wagers.
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