Three Benefits of Warehouse Automation Duplication for Multi-Site Operations

Although it’s not often that “one-size-fits-all” when it comes to implementing warehouse automation in different facilities, installing the same brand and configuration of material handling automation equipment can deliver benefits to multi-site operations.

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Phoenix Contact’s Indianapolis distribution facility was automated by an AS/RS and Warehouse Management Systems (WMS) from viastore.

Take manufacturer Phoenix Contact—a maker of industrial electrical and electronic technology products that power, protect, connect and automate systems and equipment—for example. As a global entity, the company has three regional supply chain hubs located in Germany, China and the U.S. When it came time to better support business growth in both North and South America, the company decided to automate its Middletown, Pennsylvania manufacturing and distribution facility and chose to mirror its automation installation already in place in Blomberg, Germany.

The resulting solution includes a robotic depalletizer, a conveyor sortation system, a 40-foot-tall mini-load automated storage and retrieval system (AS/RS), and ten goods-to-person pick/pack stations driven by a warehouse management system (WMS) that also controls a conventional warehouse.

“We knew we needed to automate our U.S. facility, both in systems and in software to support Phoenix Contact’s growth in the Americas, as well as growing manufacturing in the U.S. Without it, we were on a fast path to run out of space in a couple years,” explains Lou Paioletti, director of supply chain services for the company.

In addition to freeing up an existing 45,000-square-foot distribution building to accommodate manufacturing processes, from an operational perspective Phoenix Contact has benefited in three ways by creating near-duplicate automation systems spaced 4,500 miles apart, Paioletti says. Among them:

1. Elimination of additional handling steps. “We receive product manufactured in Europe at our U.S. facility already in totes, using our supply of company-owned sea containers,” he says. By selecting compatible AS/RS solutions, Phoenix Contact’s facilities can easily pass items back and forth without requiring additional handing steps upon receipt. Further, by leveraging the automated tote storage system, the use of cardboard packaging has been reduced. Instead, the U.S. facility receives and returns the totes in a closed-loop process.

“We saw an immediate labor savings from being able to take inbound product from Europe and induct it into the AS/RS with minimal interaction,” said Paioletti. “We knew this would be a labor saver, and made an immediate impact. What used to take 7 people 2.5 days to unload a sea container now takes 3.5 people 6 hours.”

2. Establishment of best practice handling and operations processes. Implementing a common material handling automation solution across multiple facilities made sense to Phoenix Contact’s management from a sharing of best practices perspective. “There was a collective mindshare in trying to utilize a global solution,” adds Paioletti. “Having an automated facility in Europe, we already saw the potential that an automated facility in the U.S. could bring our operations.”

Like its counterpart location in Germany, the automated U.S. facility has also experienced higher throughput, lower operational costs, greater density storage and a higher level of system availability than conventional warehousing. Network-wide, the “increased processing speed has reduced our lead times, resulting in lower required reorder points and, subsequently, more efficient inventory levels,” he says. “Overall, when looking at total labor and line items shipped, the system has delivered a 50%-plus productivity gain.”

3. Supply chain information system synchronicity. Having facilities with identical automation equipment and information systems makes sharing planning and performance data across geographic boundaries much easier. At Phoenix Contact, product and order information from the global enterprise resource planning (ERP) system interfaces with each operation’s warehouse management system (WMS), creating true economies of scope.

At the facility level, the WMS directs product allocations, sequencing and picking of totes to the pick stations to fulfill customer orders. “Our WMS handles both a fully automated AS/RS and conventional warehouse using the same software,” concludes Paioletti. “This gives us the ability to better serve customers and improve manufacturing support, all from a single solution.”

Would your multi-site operation benefit from implementing the same warehouse automation solutions in every facility? Call us at 616.977.3950 to discuss your supply chain and handling goals with one of our warehouse planning specialists.

About John Clark

John is responsible for Marketing and Business Development at the North American headquarters of viastore systems in Grand Rapids, MI.

He has over 20 years of broad hands-on experience in all aspects of marketing and communication, including writing, content marketing, advertising, design, trade show and event planning, public/media relations, website, lead generation and management.

Prior to viastore, he has held marketing management positions at TGW Systems and Dematic, both global material handling automation companies.

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