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November 2018
Brian Neuwirth explains how the warehouse of the future may look different from today.

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How will the warehouse of the future look different from today?
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Brian C. Neuwirth is VP of Marketing and Sales at UNEX Manufacturing
Brian C. Neuwirth is VP of Marketing and Sales at UNEX Manufacturing

Warehouses are evolving and rapidly transforming to meet the challenges of today’s customers who want quick deliveries and real-time knowledge of where their orders are at all times. Warehouses are becoming smaller and locating closer to end customers to cut down on delivery charges. More brick and mortar stores are handling fulfillment of e-commerce orders to speed deliveries. Better efficiencies are gained through a mix of material handling equipment that speeds throughput, optimizes order picking and increases product flow.

Warehouses of the future will become more like true distribution centers where supplies that come in, immediately go out without storage of the products. With less storage, more cross-docking operations will occur. Cross-docking is a practice in the logistics field of unloading materials from an incoming truck and loading these materials directly into outbound trucks, trailers, or rail cars, with little or no storage in between. The reason this is occurring is because more retailers are supporting omni-channel fulfillment operations that include fulfillment at stores instead of fulfillment from a warehouse. Stores will have visibility into inventory levels across all retail outlets and have the ability to fulfill orders in-house or get inventory from other stores to fulfill orders.

In the immediate future, there will be a continued growth in cross-docking operations and true omni-channel operations. Retailers will have visibility into inventory across all operations and will share inventory to meet customer orders. Some cross-docking best practices include:

  • Handle each piece of freight only once.
  • Make dock layout as compact as possible.
  • Match staff to shipment volume.
  • Keep the dock floor clean and organized.
  • Use materials handling tools to speed movement. Conveyors will allow cartons to travel directly from the unloading trailer to the loading trailer, eliminating travel time and extra handling.

Inventory management is reported as the most challenging source of inefficiencies, as well as an area where it would be easiest to gain cost savings through technology. Most warehouses have issues with items that don’t get sold so they carry a stagnant inventory. These unsold items just continue to take up space in the warehouse, where their value is lost. To rectify this, warehouses need to act more like a distribution center and push these products out to the retail stores. They need to not hold onto the inventory and instead sell it in the stores. Retail stores, on the other hand, need to have areas within the store to handle fulfillment operations. 

Companies need to turn their warehouses into modern distribution centers focused on optimizing inventory. They need to know where inventory is, make sure it is replenished on store shelves so it will sell.  Utilizing systems such as RFID-tags that identify, diagnose, and prevent out-of-stock conditions, will help to remove uncertainty from in-store inventories and prevent lost sales. Moving inventory out to the storefronts using automation to push products from the warehouse will help rectify the situation. Conveyors, picking systems, sortation units are all material handling automation equipment that can improve throughput and increase efficiencies. Order pickers spend about 60 percent of their time walking product or moving product around. Using conveyors or sortation systems can reduce travel time and improve throughput.

Retailers can maximize the profit out of their inventory by increasing efficiency. Reducing inventory provides an increase in working capital, which leads to bottom line profits. More inventory will be moved closer to pickers for easier for more accurate picking, improving productivity with increased seasonal demand and utilize warehouse and worker assets to their fullest. 

Streamlining product flow is an ongoing challenge in most fulfillment facilities. It’s more than simply having the right product on hand to fill orders, although that is certainly an overriding goal. Product flow affects inventory availability and accessibility, product rotation, replenishment and storage processes, travel time, handling and ergonomics, and picking speed and accuracy. For fulfillment operations that handle large volumes of fast-moving inventory consisting of a wide variety of SKUs, the proven turnaround solution is a well-designed carton flow rack system. 

Why carton flow? In today’s e-commerce environment, distributors are less likely to be handling full pallets; instead inventory is moved to the pick area in individual cartons, where pickers pull items to fulfill the more typical smaller, multi-SKU order. In this type of application, using carton flow racks can increase operational efficiency by as much as 75%, often immediately. How?

Carton flow rack systems are shelving units consisting of multiple levels of pitched tracks, complete with either wheel beds or rollers. Cartons are loaded from the rear at the apex of the rack, where gravity propels the carton forward on the rollers toward the picker, in the same sequence in which it was loaded. If there is already a carton in the queue, the newly added carton simply falls in line until it is needed. 

This first-in/first-out (FIFO) design not only ensures efficient inventory rotation, but also allows picking and replenishing operations to take place simultaneously from opposite sides of the rack. Ongoing replenishment means the correct carton always on hand, within reach and in clear view. Freed from the need to wait or travel, workers are able to pick more quickly, accurately and efficiently. For optimized turnaround, carton flow rack systems are the tool of choice. 

At the same time, it’s important to choose the best carton flow system for your distinct application and product mix. A robust carton flow rack system will minimize product hang-up, which can result in operational delays, damaged inventory, risk to workers and costly maintenance issues. Matching the carton flow system’s size and capabilities to your operational needs is important to achieving optimum space utilization and pick productivity. The best systems are modular, portable, adjustable, customizable, attractive and guaranteed by warranty. 

Mobile Devices in the Warehouse

Smartphone and tablets are making their way into the warehouse to improve fulfillment rates and manage inventory. Because of the increase in e-commerce orders due to a better economy, SKUs are proliferating throughout the warehouse. Plus, new regulations are requiring more accurate product tracking and tracing. In a recent survey from Zebra Technologies, it is reported that only 12% of respondents expect to still be using pen and paper-based processes by the end of 2018.

Paper-based processes are prone to error. Pickers with a printed pick list can easily pick the wrong item from a location that is adjacent or can mis-read the pick list and select the wrong SKU number. Or a product can be put in the wrong location, making it difficult to locate. When filling out forms, numbers may be transposed, leading to wrong order numbers, part numbers and quantities being picked.

To remedy this situation, time-consuming physical inventories are taken often in the warehouse, requiring even more man-power and adding to costs. Paper-based order picking is very inefficient, fraught with error and slow.

Order Picking Systems

The constant pressure to keep up with increased demand has driven a number of companies to improve order picking processes, leading to improved efficiency, accuracy and speed. Order picking involves various methods of bringing products to be picked right to the order picker, or closer to the pick face (in front of the order picker) for quicker picking. These systems include goods-to-person, pick shelves, carton flow, pallet flow, etc.

Goods-to-person (GTP) involves bringing items to be picked to the picker. Statistics show that order pickers spend 60 percent of their day traveling within the warehouse and only 40 percent picking. With GTP, traveling is reduced, even eliminated because products are brought to the picker via conveyors, automated storage and retrieval systems, mobile storage shelves or sortation devices as directed by the order management system or WMS. Pickers take the items, place them in containers to fulfill orders. Eliminating picker travel by bringing the goods to persons helps companies to increase productivity and improve efficiencies.

Pick shelves are angled metal shelves that allows items, boxes and containers to be stored. When the order picker takes the item closest to the pick face, the items behind slide forward, ready for the next pick. The first-in, first-out (FIFO) methodology of inventory rotation is perfect for pick shelves. With FIFO, the oldest products are used or picked first, ensuring product quality and safety. When products are picked for an order, newer arrived products slide forward from the back to replace the just-picked item. Pick shelves provides precise, flexible and accessible pick points for order pickers.

When choosing to automate picking operations, don’t just focus on the cost of the system; instead look into long-term maintenance, durability, flexibility and repair costs. Understand how easy or hard the system is to move and change; the easier and quicker the better. These systems should be able to be moved and expanded easily. Check the implementation, training and support processes to make sure everything works well and can be supported. Besides faster picking processes, better utilization of space, higher throughput and higher capacity should also be analyzed.

The warehouse of the future will include a combination of automation in the form of robots, automated storage and retrieval systems, wearable devices and drones, along with non-automated systems like carton flow, conveyors and order-picking shelving. As many warehouses are getting smaller and placed nearer to customers, space is limited, which means big material handling systems are not suitable. Using pick shelves, carton flow systems and flexible conveyors that can be moved around in the space to where they are needed will increase efficiencies of the warehouse of the future, leading to greater fulfillment and order-picking speeds.

Brian C. Neuwirth is VP of Marketing and Sales at UNEX Manufacturing, the trusted industry leader in order picking solutions that maximize space usage, increase pick rates and improve ergonomics. UNEX offers a full range of order picking solutions, including their patented carton flow solution Span-Track, a full line of gravity conveyor products tailored to the order picking process and UNEX Flow cells for durable, modular and portable storage for the manufacturing floor. Email: editorial@MHWmag.com to contact Brian.
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