Warehouse & Distribution Centre Layout & Design
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Warehousing Problems?
- Running out of space?
- Costs too high?
- Poor productivity?
- Poor layout?
- Processes not working?
- Thinking of moving?
- Thinking of outsourcing?
Then Logistics Bureau's warehouse specialists can help with these issues and more. We can provide you with:
- Lower warehousing and handling costs
- Help with warehouse analysis
- Detailed Warehouse and Materials Handling Design Layouts on CAD Drawings
- Expert Equipment Selection advice
- Assistance in Supplier Negotiations to ensure the costs are minimised
- System Integration and Project Management
- Process Design and Staff Training
Call the Logistics Bureau Now!! ... Contact a Specialist Here
We are experts in Warehouse Design and Materials Handling Solutions
Do you really need a New Warehouse or Distribution Centre?
When your warehouse or distribution centre capacity is at bursting point, and costs are escalating while service levels are not being met, it is natural to assume that a bigger and maybe “smarter”, warehouse would go a long way to addressing the issues.
That maybe the answer but how can you be sure? Could you remedy the situation and/or buy time by investigating the primary causes of the existing situation?
Logistics Bureau's consultants have extensive experience in assisting customers in the identification of causal issues through Warehouse Facility Design, Layout and Operations Audits.
These audits investigate the appropriateness and operational effects of the existing:
- S&OP
- Inventory/Buying Policies
- Levels of Service Offered
- Operational Processes
- IT Systems
- KPI’s
- Materials Handling Equipment
- Equipment Layout
- Warehouse Building Design
A change in even some of these could avoid the perceived need for a considerable expenditure on a new facility.
You definitely need a New Warehouse!
If the need for a new warehouse facility has been confirmed, important decisions need to be made.
How can we ensure the optimum warehouse design & layout?
Companies rarely have available in-house expertise in warehouse facility layout and design, and the common response is to approach equipment/systems suppliers. Suppliers will naturally suggest solutions that can be met by their range of equipment. Their scope of supply and expertise will define their solution and so the investment required. The costs they incur in designing the solution will be recovered in the equipment cost. The Logistics Bureau has over three decades of experience in warehouse facility and operations layout & design.
Where should the Warehouse be Located? Warehouse Location Video
The location of the proposed warehouse facility is likely to be a key driver of implementation and on-going transport costs. The Logistics Bureau can assist in this decision using elements of the Network Design and Supply Chain Mapping tools. The preferred locations can be checked for cost and availability of sites and/or existing buildings through the Logistics Bureau’s Industrial Real Estate contact network.
Logistics Bureau Warehouse Design Methodology
Our warehouse consultant's design methodology begins with a review of the existing operations and the gathering of SKU and Transactional data. The steps in the warehouse design are initiated by the analysis of this data and can be performed by the Logistics Bureau's consultants, in consultation with the client, or by the clients staff with assistance by Logistics Bureau practitioners.
Warehouse Data Analysis
The historical data is analysed in order to build a picture of the operational warehouse requirements and costs for the period covered by the data set. Broadly the results cover the requirements for receipt, storage, fulfillment and despatch and the costs incurred in process. The results are presented to the client for a “sanity check” and costs and productivity rates are benchmarked against industry standards.
Warehouse Performance Specifications
In consultation with the client, the warehouse requirements are then factored for growth in inventory, throughput velocity, fulfillment and despatch. These then form the performance specification which lays the base for the warehouse design options
Warehouse Goals
The criteria, by which each warehouse design option is judged, are set. These can include, acceptable ROI, implementation costs, operational costs, image, flexibility, dependence on labour and many more
Warehouse Constraints
The constraints that will shape the warehouse design options need to be identified. These will include amongst others, IR issues, capital, IT systems, risks, timing, clients capability, site/building availability etc.
Warehouse Options Design & Layout
A number of warehouse layout options are then designed by our consultants and costed at a high level. The costing includes implementation and warehouse operational costs and the client’s preferred ROI formula is applied to each option. The designs include high level CAD drawings of the warehouse layout and materials handling equipment, manning levels and probable warehouse expansion options.
Warehouse Preferred Option Identification
The warehouse options designs, with implementation and operational costs, are then presented to the client and marked against the Performance Specifications, Goals and Constraints. Operational staff, potential suppliers, IT, sales etc. can be asked to provide input. The client can make an informed decision as to the preferred option.
Detailed Warehouse Layout and Design
The detailed layout and design of the preferred warehouse option will include, performance specifications, equipment layout, facility footprint and building design and cost, (new building), specification of static and mobile materials handling equipment, high level process design, detailed implementation and warehouse operational costs.
Warehouse Simulation
Depending on the complexity of the systems and capital cost of the preferred option there may be a need for a computer simulation model of the system’s operation. The warehouse simulation model is time based, and takes into account all the resources and constraints involved, and the way these things interact with each other as time passes, confirming the system design.
Supplier Identification and RFT
The Logistics Bureau's consultants will provide a listing of suppliers of the required equipment/systems and seek expressions of interest. An RFT equipment specification is compiled from the detailed warehouse design. It also includes contract and payment terms, site conditions etc and is distributed to interested suppliers. The Logistics Bureau liaises with the potential suppliers answering any queries and distributing equally any new information that may come to light.
Response Evaluation
Responses are analysed and checked against the system requirements. In conjunction with the client, a supplier/response “scoring sheet” is compiled including loadings for critical areas and perceived risks. The Logistics Bureau will facilitate a workshop to assist the client in the evaluation and choice of the supplier partners however we do not make any recommendations as to the suitability of any supplier. Once the preferred suppliers’ shortlist is identified the Logistics Bureau will assist in the detailed contract negotiations.
Once contracts are let the Logistics Bureau's consultants can assist in the project management of the system installation, commissioning and testing and implementation.
Contact a Warehouse Specialist Now
For a more detailed discussion on these warehouse related services please feel free contact the following senior staff:
Sydney - Mal Walker
Tel: +61 412 271 503 |
Melbourne - John Cole
Tel + 61 411 706 726 |
SE Asia - Colin Airdrie
Tel: +66 819 464 490 |
Warehouse Design Articles
Warehouse Design - Goals and Constraints
Every warehouse design is formed by the things we want achieve, (Goals), and the reality and boundaries in which the warehouse design must fit, (Constraints).
If we don’t have the Goals and Constraints articulated and understood we cannot achieve a successful design, as a matter of fact, without the Goals we can't judge whether the design is successful.
As the warehouse design progresses Goals become more detailed and are applied to to smaller “building blocks” of the overall design. Constraints get to be better understood, detailed and give rise to Goals.
These Goals then become the specifications for equipment and processes, all of which go to make the design successful.
Let’s take a real life situation and see where the lack of attention to constraints almost derailed a multi million dollar warehouse design project overseas.
An entertainment products distribution company distributed to book stores, major retailers and some schools. Order sizes ranged from a single volume to multiple volumes of the same SKU and multiple SKU’s. There were over 14,000 titles, (SKU’s) in stock and the operation was paper based. 85% of orders had to have the invoice enclosed.
The staff were long term permanents and the facility based in a small community which essentially depended on the company for its economic survival.
The problems were, that as volume and velocity increased the customer service levels decreased and Delivery In Full On Time, (DIFOT), became the exception rather than the rule.
The Goals were:
- Increase the life of the warehouse to ensure the Corporate responsibility to the community
- Increase Customer Service to Order received by 2:30 p.m. dispatched by 5:30 p.m.
- Increase DIFOT to 99%
The Constraints were:
- Available capital was $1 million
- The warehouse operation must continue during the implementation
- The Go-Live date must be before the end of the 3rd quarter in order to be in place before the end of year peak period giving the company 22 weeks to complete the design, contracting and implementation
When the warehouse operation was broken down by process, it became apparent that the induction of orders and order picking could and was coping with the increase work loads. The issues were in the checking, packing, invoicing and dispatch areas.
Orders were picked into the cartons originally containing the delivered stock. Cartons sometimes had to be “engineered” to protect the contents.
Picking was from Invoice and any “no picks” had to be entered post pick to generate a new invoice. The invoice was pinned to the end of a carton to signify a missed pick so the operator could manually generate the invoice.
Not every order was checked, a sample was pulled aside for manual checking. As the throughput increased near the end of the day the percentage of throughput sampled became lower.
Consignment-Notes were prepared just before carton taping, as the exact number of cartons in an order wasn't known until then.
This operation was full of delays and required constant intervention by operators.
The chosen warehouse solution was to:
- Introduce 3 standard size cartons as “pick to” carriers
- Use the already populated Product Master File to “cube” orders and assign components of the picked order to the standard cartons
- Print unique “number plates” for each carton
- Calculate the weight of each carton’s contents and check weigh after pick
- In the event of a “fail weigh check” that carton would be diverted to a checking station
- Recognise the last carton of an order, requiring an invoice be enclosed and divert for invoice printing
- Automatically tape seal completed cartons and divert to a palletising lane
- Read the labels at the end of these lanes and “build” a pallet with the operator closing and opening new pallets and calling for a pallet label
The Constraints were:
- The operation had to be housed in an area 50M x 30M
- The system had to marry into the existing conveyor system
- All the system “control intelligence” was to be stand alone
- Data on picked orders was to be downloaded to the main frame to adjust inventory
- Order cube and weight calculations were to be handled by the mainframe
- Invoices were to printed by the mainframe
- The system must handle 1,800 cartons per hour during the peak times of 2:00 and 5:00 p.m.
The system was designed and the contracts let. It was installed on-time and within the budget. During go-live and testing it was apparent that an important constraint had been overlooked.
The mainframe could not print invoices at the required rate. The process was devised to pre-print the invoices, it could only handle 3 invoices per minute, and the new system required a rate approaching 15.
No one from IT had considered the Constraint of the printing capability of the main frame. This was a show stopper…if we couldn't print the invoices quickly enough the whole system ground to a halt.
The fix required time and money, sending the project over budget and the time target.
Had the Goals and Constraints been work-shopped regularly during the design and implementation, a great deal of money and heartache would have been saved
So the message is:
Consciously introduce the thinking on Goals and Constraints, work-shop them through each stage of the design and implementation and apply them to all inputs to the system being designed.
Author: Ian Robins
