Problem

The Amazon effect has a significant influence on customer demands for this national fulfillment center. Customers expect an order placed today to be right at their doorstep the next day. To meet this demand and meet customer expectations, overtime and hiring was carried out.

In addition, the increase in supply and order volume, as well as the storage area to be covered of more than 200,000 sq. ft., forced a complete overhaul of the picking, packaging and shipping process.

Solution

An analysis of inventory movement showed that stock was not optimized according to the velocity of the items. A time and motion study found that more than 50% of the picking time by warehouse workers was moving from one location to another, despite the use of a high-density mezzanine. The number of picks per hour was between 75 and 80 lines, while the capacity analysis based on customer demand requires a rate 35% higher.

The proposed solution was to set up a goods-to-person picking system and a new conveyor system. In addition, the picking, packing and order consolidation processes have been improved to simplify and expedite the shipment of customer orders.

Results

The implementation of a positioning optimization engine according to velocity has made it possible to increase picking productivity by more than 15% and to be able to achieve a picking of 90 lines per hour for certain types of orders.

The “goods-to-person” system, for its part, enabled more than 130 lines per hour to be achieved.

Finally, the conveyor system and improved processes almost doubled the number of lines shipped and reduced overtime for picking, packing and shipping.