In the U.S., we spread out. In Europe, they move up.

And that's exactly what Julius Blum Inc. did at a manufacturing plant in Bregenz, Austria. It even went a little further with that concept.

Not only did Blum go up but it also went underground to make maximum use of its real estate. The main plant, which is three stories tall, connects to a two-level plant by a 100-yard long tunnel, explains Wiegobert Haller, logistic leader.

At the complex, which is located near the company's headquarters along the Swiss border, Blum builds kitchen cabinet drawers and hinges for the European market. The company also supplies its U.S. arm with finished goods as well as components and assemblies for production of cabinet hardware in Stanley, N.C.

With manufacturing spread over two buildings and multiple levels, Blum Austria has some materials handling challenges not seen in a single-level plant. To begin, the two buildings are sufficiently separated that horizontal travel distances are not necessarily minimized. Furthermore, materials have to move between levels in an orchestrated fashion that supports schedules which may very well conflict at times.

Making this work well requires a mix of manual and automated materials handling solutions. The centerpiece is an eight-aisle automated storage and retrieval system (Swisslog, www.swisslog.com) that handles components and finished goods on all three levels of the main building. The system is augmented by two other AS/RS and several manual warehouses that manage raw materials and components across the two buildings. Meanwhile, materials are moved by a combination of powered conveyors, vertical reciprocating conveyors, lift trucks and automatic guided vehicles (Swisslog).

Software works behind the scenes. It controls everything from movement of the materials handling equipment to the balance between production and customer requirements. Key software packages are the logistics management system, which manages the overall operation, and the warehouse management system, which manages warehouse activities and equipment.

The end result, explains project manager Elmar Marchl, is a highly efficient production complex that keeps pace with extremely strong demand without sacrificing quality. The components and finished goods AS/RS turns its 19,000 pallet positions every 10 to 15 days, minimizing inventory levels without slowing production or shipments.

Certain raw materials such as steel coils as well as components are received in both buildings. In the main building, this occurs on the lowest level of the three-story plant. Receiving in the second building is on the bottom level too.

Raw materials and some components come from outside suppliers while the balance of components are from other Blum facilities in the area. Receiving is handled the same way in both buildings. Due to certain operational limitations, not all receipts are stored in the same building as they initially arrive.

Depending on the item from outside suppliers, some are weighed while others counted to check against expected receipts. Actual data is then keyed into the logistics management system (LMS), which is the highest level software running at the plant. This initiates printing of a bar coded load unit identifier label that tracks the load during the warehousing process.

Materials are also transferred to what are known as half-size Blum pallets. These pallets are roughly half the size of a Euro pallet. A Blum half pallet is for smaller loads.

Receipts from other Blum facilities already carry the load unit identifier, which is simply scanned to confirm receipt. These materials also arrive on a Blum pallet, Euro pallet or in a Blum crate, ready for putaway. (The load unit identifier labels as well as the Blum pallets and crates are also used in the U.S. facility.)

In the main building, components travel by lift truck a short distance to an input conveyor that feeds the eight-aisle AS/RS. A fixed-position scanner reads the load's label and updates the warehouse management system (WMS) that runs that AS/RS. The WMS was pre-notified by the LMS that the load would be arriving. The WMS then selects a storage location and the load is then putaway in the system.

Raw materials received in the main building are picked up by lift truck for transportation to a second AS/RS also in the main building. Putaway is managed much the same. However, a second WMS manages this 2,500 location AS/RS.

Any receipts that must travel to the other building do so by laser-guided automatic guided vehicles (AGV). The eight-vehicle system operates only on the bottom level of the two buildings and in the tunnel of the complex. At the far end of the tunnel, the AGV simply deposits the load on the warehouse conveyors or at separate stations for pickup by lift truck. Drivers receive instructions by on-board wireless terminals from the LMS, and putaway the load as directed.

Components and raw materials received in the second building are also stored by lift truck in the third AS/RS and manual warehouses there. Each of these warehouses is also run by a dedicated WMS, all of which are tied into the LMS, ensuring coordination of materials throughout the complex.

While receiving is handled only on the bottom levels of the two buildings, manufacturing is a bit more complex. It occurs on all three levels of the main building but on both levels of the other building.

In all cases, however, workers follow the same procedure to order raw materials and components to their workstations. As needed, they request materials from the LMS. In turn, this data is sent to the WMS managing the warehouse where the materials are stored, notes Haller.

After retrieval, materials that must be shuttled between buildings are handled the same way as they were originally sent to storage - by AGVs and lift trucks using the tunnel. Once in the main building, AGVs follow two possible procedures. On the bottom level, loads are deposited at designated workstations. For materials needed on levels two and three, the AGVs deliver loads to deposit stations at vertical reciprocating conveyors that feed the upper floors and final delivery by lift truck.

For those components stored in the AS/RS in the main building, the system delivers materials directly to the floor where they are needed. On the bottom level, AGVs deliver materials directly from the AS/RS to workstations. On levels two and three, loads pass from the AS/RS onto a conveyor spur for pickup and delivery by lift truck.

Materials in the second building travel by vertical reciprocating conveyors upstairs to production. Lift trucks make the final delivery to workstations on the shop floor.

Regardless of where they are manufactured, all finished goods must pass through the main building's eight-aisle AS/RS before shipping. After receiving a bar coded transport unit load label at the production station, pallets from the second building travel by lift truck and AGV to the AS/RS. In the main building, AGVs deliver loads to storage on the bottom level. Finished goods from floors two and three re-enter the AS/RS directly for putaway.

Shipping for all finished goods is from the second floor of the main building. Planning software makes the bridge between the order system and the LMS, determining what pallet loads to call out of the AS/RS at any particular time, explains Marchl.

Picked pallets leave the storage system on a conveyor spur for staging. Full pallets are directed to a pickup station for retrieval by a lift truck and delivery to a designated shipping consolidation lane.

Pallets needed to build orders by case pick are staged on conveyor to feed one of two picking stations. Following instructions on a terminal, workers build orders by picking cartons onto another pallet for shipping.

Once complete, the pallet load is released to a shuttle car that delivers it to a location for lift truck pickup and delivery to the consolidation area. Pallets sit there until a customer order is completed.

Prior to shipment, each finished goods pallet load receives a serial shipping container code label and is stretchwrapped. Each pallet is hand scanned as it is loaded onto an over-the-road truck. Shipments of components and some finished goods to the company's plant in Stanley, N.C., are handled the same way.

"As you can see, we have created systems to manage the flow of materials vertically and horizontally and it works quite well," concludes Marchl.