Modern Thinking: From steel plant to DC
Staff -- Modern Materials Handling, 2/1/2009
Interstate-McBee sells components and kits to diesel engine parts distributors and repair shops. Our Cleveland facility accounts for 12 million parts (18,000 SKUs). Our facility is the story here.
Our previous DC was running out of space, and it was not a safe work environment. It was 24,000 square feet and inventory had to be spread among several facilities, accounting for an additional 20,000 square feet. That's inefficient and expensive. It was expensive because in addition to the leases and utilities, we were paying employees to drive between buildings.
Eighty percent of our business is same-day, where a customer will call us by 3:30 and we accommodate whatever order is placed if it's in the continental U.S. We needed a building that would lend itself to that service.
All of the warehouses we looked at were too small. Then we came upon a building with clear height, wide spans with no eaves in the way, and a good solid floor. In its previous life it was a steel plant. To my surprise, a steel plant offered just what I was looking for from a DC. In addition to being conveniently located for our employees, the infrastructure we needed was already here, including the power. Plus, we knew the floor would hold any load we chose to put on it. After all, it was built to hold 20-ton steel-hauling cranes.
There were constraints, however. When we moved here it might have taken 10 minutes just to walk to the far end of the building to fill an order. With some help from our consultants, Trommer & Associates (330-668-3700, www.trommerinc.com), we implemented a zone-picking environment with eight zones. I have seven full-time pickers and now they pick less than six hours a day because of the efficiency we gained with this facility.
Facilities like this will become more available as the manufacturing base in some regions shrinks. Cities will work with businesses, and landlords are more accommodating, too. The landlord insulated ours to lower heat loss through the roof and replaced the windows with high-efficiency glass. Bottom line, distribution doesn't have to be a in a box. Because of this facility we're a more efficient distribution company.
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