Advance Auto Parts - Turbo-Charged Distribution
Productivity Award Winner in Distribution
Staff -- Modern Materials Handling, 4/1/2002
After successfully expanding throughout its home state of Florida in the 1990s, Discount Auto Parts (DAP) which merged late last year with Advance Auto Parts, began putting down roots in neighboring southeastern states. And before long it became obvious that a single distribution center in Lakeland, Fla., couldn't go it alone supplying more than 600 stores that made up the DAP retail network.
That's when a new distribution center was built in Gallman, Miss. Within months, the new center had begun to lap overburdened Lakeland.
Central to the DC's effectiveness is a unique system that combines a pallet carousel, gantry unit and stretch- wrapper that together build pallets of case pick. The system is more than 500% more efficient than the case picking methods at Lakeland – 1,000 picks an hour compared to just 170.
Additionally, picking from pallet flow racks in the new facility is 70% better than in Lakeland. Full case picking from case flow racks is 44% more efficient. Much of this is due to extensive use of pick-to-light technologies.
Labor costs have also been reduced due to the automated systems, while staff training is much easier.
But those were the accomplishments of the DC in its first few months of operation. Since then, DAP's purchase by Advance Auto Parts makes the combined company the second largest auto parts supplier in the U.S. with over $3.0 billion in combined revenues and 2,400 stores. That has put Gallman on a steep trajectory to even greater achievements, explains Roy Martin, who was vice president of supply chain and logistics for DAP and now has accepted an executive level position with Advance.
The original plan, he says, was for Gallman to ramp up from supplying 160 stores last fall to more than 400 stores by 2004. Now the plan is to supply 300 to 400 stores by the end of this year. As a result, throughput is expected to double by mid-summer as the DC goes from one shift to two. "I've always said productivity in Gallman will improve significantly as volumes increase," says Martin.
Before that happens, however, Gallman will be closed for a short period of time in April. That will allow the replacement of the current warehouse management system with a home grown one already in use at Advance Auto Parts' DCs. Martin explains that the shift will establish continuity across the merged company while simplifying training of people and making it easier for them to move from one DC to another.
Meanwhile, one-third of the inventory, about 7,000 stock keeping units (SKUs), will be switched out of Gallman. The switch is primarily vendor-related as DAP's previous suppliers are replaced by Advance Auto Parts' suppliers.
What won't change is how Gallman processes orders. Martin explains the DC will still work to a fixed schedule that fills orders in batches using wave picking.
Where items are slotted, or placed within the DC's processing areas, is crucial to effective management of distribution costs.
"We make or break productivity here based on what we do with out slotting and inventory control," says Martin.
Efficient order fulfillment for retail outlets requires several different types of materials handling equipment. The gantry/pallet carousel unit handles the fastest moving full-case SKUs in pallet loads. Twenty-eight bin carousels process medium movers, while split-case fast movers are picked from pallet and case flow racks. Slow movers are stored in shelving in a pick module.
The gantry/pallet carousel unit is located next to the shipping dock to maximize outbound flow. It consists of two pods each with 32 wheeled carts pulled around an oval hub. Together, they hold 64 pallets of the fastest-moving large-item SKUs such as cases of motor oil, antifreeze and washer fluid.
One employee monitors the unit as its gantry's vacuum lifters lift the top layer of cases from a cart and brings it to one of three pallet-build positions. The carousel then advances to the next pick position while the gantry lifts another layer of cartons from a cart. Once all picks for a store have been deposited onto a pallet, it is conveyed to an automated stretch wrap station.
Pick-to-light systems are used to pick most all other items in the DC. At the two-level bin carousels, pick tickets are scanned to initiate picking and rotate the carousel into position for a pick. Lights show the exact shelf and quantity of SKUs for required items. These are placed in totes that are eventually delivered directly by conveyor to the shipping sorter.
Two, three-level modules comprise the forward pick area.
Pick module 1 holds broken-case items. Pick-to-light directs item selection into totes.
Pick module 2 contains pallet and case flow racks. Full cases are selected by scanning a pick ticket and then following the instructions of pick-to-light displays and lights attached to the pallet flow racks. Workers attach store labels to picked cartons as they place them on a conveyor belt that runs through the modules. The module also holds small carton items that are picked from the flow racks also using pick-to-light.
Slow-moving high-security items are picked from shelves by workers using pick-to-light carts. After the paper pick ticket is scanned, the carts show workers what SKUs and quantities to pick as well as which totes on the cart to place the items into.
"We are a retail company, so distribution is a back room function," Martin says. "Our job is to bore the retail stores with our consistency. When we have done that, then we have succeeded."
Click on this icon to read the full story about the distribution center.
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