When old is new

Magid Glove & Safety turned its old factory into a new warehouse with 80% improved efficiencies.

Staff -- Modern Materials Handling, 2/1/2003

At Magid Glove & Safety Co. , something had to be done to cope with growing demand for its line of protective clothing and safety equipment. Not only was the amount of space in its adjoining manufacturing and warehousing operations insufficient for rising volumes, but there was a strong need to cut costs and improve overall operations just to remain competitive.

'Our efficiencies were poor,' explains Greg Cohen, operations manager and a fourth-generation family member to work in the business. All shapes and sizes of boxes were stacked ceiling high on all three floors of the building. Building and rebuilding of pallets was common. And all materials handling was manual assisted only by pallet jacks and freight elevators.

While Cohen and other family members would have liked to start over again with a new building, that option was costly. Furthermore, a new facility would have required the company to move 50 miles from its northwest Chicago location, potentially losing many if not most of its employees.

Instead, Magid moved its manufacturing operations to a 130,000 square foot building about a mile away while turning the existing building into a top notch warehouse. Holes were knocked through many of the old walls and floors to accommodate the new handling equipment including conveyors and sortation systems (Automotion Conveyors). The facility also features wireless terminals with bar code scanners, carousels, lift trucks and a warehouse management system (WMS).

'We literally turned the building upside down,' says Cohen. 'We planned our renovation as if it was an empty building. Each room was redesigned.'

With paperless order processing, accuracy has improved to better than 99%, and information is available in real time. Labor has been reduced 30% with corresponding increase in efficiency. Same-day order processing is now the norm despite extensive value-added services for customers. The $5 million project, the biggest ever undertaken by the company, has an expected return on investment of four years.

The renovated facility has nine receiving docks. Five are used to receive imported items while the others are for output from Magid's 600 domestic suppliers including itself. After initial processing, receipts are palletized, bar code labeled and scanned, marrying the pallet to the product on it. Lift trucks take full pallets to reserve storage or to pickup and delivery stations for later putaway. Less-than-full pallet loads go to forward picking areas.

Reserve storage has both high-stack racking and drive-in pallet racks. The former is located slightly below the first floor where an indoor railroad siding once was. The drive-in rack is located in several rooms on the first floor.

Arriving stock keeping units (SKUs) with four pallets or less head to single- and double-deep racks in the high-stack area. Prior to putaway, which is under the direction of the WMS, the reach truck operator scans the bar code at the location and on the pallet to marry the two for the software.

SKUs with more than four pallets go to the drive-in rack. Putaway is similar to the procedure used in high-stack racking.

Received SKUs of less than a full pallet are taken from the docks to pallet racks in the forward pick areas. The vast majority of these SKUs are stored on the second and third floors. The fastest moving SKUs remain on the first floor to be closest to shipping.

The forward pick areas are replenished as needed with stock from reserve storage. The WMS directs the pulling of these items from the high-stack and drive-in areas. These are deposited onto the closest freight elevator for transportation to the second and third floors. There they are assigned positions as close as possible to the elevator to reduce the handling distance of the lift trucks and pallets jacks used to move the loads.

The forward pick areas on the second floor also include flow rack for the fastest moving items, horizontal carousels for medium movers and bin shelving for slow movers. The conveyor system replenishes both from cases previously placed into the pallet racks of the forward pick areas.

Orders for gloves and other stock items are released for fulfillment every 1-1/2 hours. Shipping labels are pre-printed and distributed to the various areas for picking.

Full pallets are pulled from reserve storage. Lift trucks pull from the drive-in racks while reach trucks handle the high-stack racks. Picking directions are displayed on wireless terminals and bar codes scanned to confirm accuracy. Full pallet shipments are taken directly to the dock. If the pallet is to be broken into several orders, each carton is labeled and deposited on the conveyor that delivers it to a shipping sorter.

Full case orders are pulled from the pallet racks and bin shelving of the forward pick areas. Split case orders are picked into totes from carousels, flow racks and pallet locations of the forward pick areas. Using wireless terminals, the WMS directs all picking while a conveyor system moves cartons between rooms and onto other areas of the facility. Freight elevators move inventory between floors. Some picked items are also diverted to a value-added area for special processing. The conveyor system ensures all picked items arrive at the shipping sorter.

'Companies in similar situations should take a long look at their (existing) building,' says Cohen. 'New buildings might be an easy answer, but they may not be the best. Old buildings can work well too.'

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