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DC Automation: Taking the Plunge

By Bill Elenbark on Mar 4, 2008 in Publish

In the January issue of Logistics Management, Gross & Associates senior engineer Maida Napolitano published an article about three companies’ efforts to automate their warehouses by using material handling technology to improve productivity. The companies profiled were JTM Food Group, Victorinox Swiss Army, and Corporate Express Canada. These companies found that investments in new technology resulted in productivity gains and labor cost savings that translated into more than satisfactory returns on their investments.

Most logistics managers seem to be satisfied with just “getting by” with what they have or profess not having the deep pockets that they associate with high-tech innovations. However, software has become cheaper and more standardized. Hardware has become more generic and maintenance-free. DC technological upgrades have not only become more powerful, but also more affordable. With increased customer demand and cost control efforts coming down from the C-suite, just “getting by” no longer makes sense.

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    #9   Close out the merchandise. In many trade lines there are companies that specialize in buying close-out merchandise. They may resell by mail order, through off price stores or as 'special purchases'in full price stores. Look in trade journals, The Wall Street Journal and local newspapers to find who handles your class of product. Sometimes your present customers may be interested in a one time deal to use as a promotion. Do not overlook your employees as close-out customers. With luck, you may even find another outlet for your regular merchandise. You can use close-outs to sell raw material as well as finished goods.
    #45   Use computer directed putaway. If the inbound material does not require elaborate checking in procedures and a computer can assign empty locations for each pallet, the material can be put away directly into storage eliminating the need for receiving staging space. If the receipt contains less than full unit storage quantities, the computer can locate a partially filled location of the same product and direct the putaway to fill the location.
    #4   Sell to present users. Use your sales or warranty history to find the people who have bought the product. Let them know that you have more available for immediate delivery. Consider telling them that you are discontinuing the product and closing out the remaining inventory. Offer a discount because they are loyal customers. Offer owners of older versions the chance to upgrade at low cost.