Integrated pallet system enhances efficiency and safety
By utilizing dual purpose returnable containers, Ace Hardware dramatically reduces required lifting and associated employee injuries.
By Staff -- Modern Materials Handling, 8/1/1998
A major issue facing many companies is how to combine cost-effectiveness and safety. Lifting of heavy product during truck loading and off-loading is a primary, related health issue. Ace Hardware, the dealer-owned hardware company with headquarters near Chicago, Ill. (Oakbrook), found a solution to these concerns by initiating a container program. It includes returnable plastic pallets and sleeves.Ace uses the new pallets/sleeves (Tuscarora) exclusively at its 600,000 sq ft facility in Little Rock, Ark. The distribution center is composed of two warehouse areas because of an expansion three years ago to the original 360,000 sq ft building. From this support center, Ace serves a number of regional retail stores.
Although not easy to quantify, the most valuable benefit to Ace Hardware from the container program has been a significant reduction in worker injuries. The number of worker compensation claims has been cut substantially; because the container program is still relatively new, an exact accounting is not available.
Another advantage is the time savings. While drivers formerly needed to scan each individual item within a shipment, they now scan just one label. When shipped to retail outlets, each product within the TRIPS (Tuscarora Returnable Integrated Pallet System) containers is scanned and recorded on one label.
Don Zimmerman, distribution center manager, notes that the containers are in use to some degree in all Ace retail support centers, and will be used exclusively in 80% of Ace locations by the end of this year.
As a result of using the container program, Ace has seen at least a 25% increase in numbers of products shipped from the Little Rock facility. According to Zimmerman, the two warehouse areas of this retail support DC store the same types of parts. These two areas differ in that the expansion area contains rack storage only, and stock in this area is stored before shipment to the company's retail operators.
The original facility has a combination of rack, shelving, and floor storage. A one-way accumulating conveyor in the shelving area transports product to the shipping area. An order picker handles stock in the floor and rack areas before shipping.
The overwhelming majority of items (99%) is stored on vendor-supplied wooden pallets. Outgoing freight is handled by an order filler, and transported to retail stores on the returnable plastic pallets/sleeves. Another benefit of the container program is that a single fork lift driver can unload a truck in 15 to 20 min., a task that previously took three hours for four people to complete.
Zimmerman praises the simplicity of the container program. He states that it has helped employees "organize inventory, and has produced a cleaner, safer work environment." He also comments on the drastic reduction in product damage since implementation of the program.
Ordering process
Except for about one percent of affiliated retailers, Ace Hardware retail outlets are part of an automatic ordering/replenishment system. According to Ron McClinton, retail support manager at the Little Rock facility, the retail stores order their stock through an automated system (Telxon) using an AS400. The ordering sequence is based on suggested maximum/ minimum levels of product, as determined by corporate headquarters in Oakbrook. Stores typically receive orders within one day of order placement.
Container program expedites process
Zimmerman emphasizes that the container program, which was implemented in 1997, began after Ace had investigated other options. The company purchased some stock-size pallets and corrugated cardboard sleeves for a few of the retail support centers. However, the stock pallets did not fit the system well enough, and the paperboard sleeves were not durable enough.
Ace Hardware ultimately found its solution in customization. The returnable integrated pallet system (TRIPS) containers are custom-designed to work within the confines of aisle widths at Ace's retail support centers.
After on-the-job testing at Ace's retail support center in Gainesville, Ga., the product needed slight design modifications. To hold the required 1,500 lb loads encountered by Ace, engineers with the container company increased the thickness of the product, and added ribbing in several locations.
To accommodate the required 1,500 lb load, engineers at Ace's container company supplier designed a 55.5 in. pallet thermoformed from 350-gauge high density polyethylene, and a 39 in. high sleeve fabricated from 10 mm plastic corrugated.
Additional customizations include a drop gate on either side of the 39-in. high sleeve, which enables users to fill the container more easily, as well as rounded corners on the drop gate, to prevent Ace employees from getting cut when loading the TRIPS containers. Ace employees comment that the TRIPS containers are definitely more effective for them than the stock-size products that had been in use previously.
Back-hauling was another concern Ace had about using returnables. Ace wanted to maximize space use on return trailers. To address this issue, containers have interchangeable top and bottom pallets that nest and stack, and the sleeves fold flat, thus easing the storage problem before return shipping by retailers. On average, Ace retail stores receive seven containers once or twice a week.
Zimmerman sums up the many benefits of the TRIPS containers by talking about "the vast improvement in worker safety," and the willingness of the container supplier to work with Ace to design a system, which met its specific needs. Ace now has a cleaner, more efficient process, benefits over and above the important increases in safety that were seen almost immediately.
System Snapshot
Ace Hardware Retail Support Center Little Rock, Arkansas
Facility established: 1985
Customers: 360 Ace Hardware retail stores throughout Arkansas, Louisiana, Mississippi, and in parts of six surrounding states
Facility size: 600,000 sq ft
Distribution center manager: Don Zimmerman
Number of employees: 250,including managers
Number of stock-keeping units: 45,000
Value of inventory: Approximately $30 million
Storage strategy: 80% rack (15,000 rack locations), 15% shelving, 5% floor
Returnable pallets/sleeves: Tuscarora 800-887-2276
Conveyors: Unex Conveying Systems 800-334-UNEX
Number of industrial trucks: 60 Crown Equipment Corporation (narrow-aisle, stand-up counterbalanced, and tugger) 419-629-2311
Stock ordering system: Telxon 330-867-3700
Hours of operation: 365 days per year, 24 hours a day: Employees work four 10-hour days each week in two shifts: 6:00 am-4:30 pm, and 4:30 pm-2:00 am
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