The right answer for Rite Aid

The drugstore giant's new DC ships 99% of orders on time to its 400 Southern California stores.

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

To the people at Rite Aid Corp ., efficient handling and processing within its distribution centers assures that the company's drugstores stock the products customers need when they want them. That requires agile facilities able to respond quickly to a constantly changing product mix.

And that's exactly the story at Rite Aid's new Lancaster, Calif., distribution facility. Situated on the edge of California's Mojave Desert, the facility currently distributes to over 425 retail outlets in the Southwest.

'We increased our store base in that area, so we built this facility to reduce operating expenses and increase our customer service,' says Mark Gullo, project manager for the facility.

The DC processes a peak of 60,000 cartons and totes daily with 99.6% accuracy. It also makes 99% of store deliveries on time.

Central to those performance levels is extensive use of pick-to-light technology (Vertex Interactive) that directs processing of most broken case items from multiple pick modules. The facility's flow-through design also features horizontal carousels, 'slapper' lines that handle fast movers, pick tunnels, eight miles of conveyors, a large sliding shoe sorter, and a highly sophisticated palletizing and wrapping system.

'It's not just the materials handling equipment though, it's how you use it,' explains Gullo. 'We have gotten about 36% more productivity within the first year by using it better.'

Or as Bill Atherton, production operations manager, puts it, 'We have the youngest facility in the chain in Lancaster, so there is a lot of growing to do.'

The DC has a total of 61 receiving docks. Some are dedicated to full pallets and containers while the others receive partial or mixed pallets. Crossdock items arrive at specially designed doors on the other side of the building next to shipping docks.

Bar code labels on each receipt are scanned for entry into the warehouse management system (WMS), which directs putaway by lift trucks with on-board wireless terminals. Putaway is in several areas.

The fastest moving items, many of which are promotional and seasonal, go to the slapper lines.

Cartons are stored at floor level on both sides of a conveyor belt. Following paper pick lists with bar code labels, items on one side are picked as full cases. As case is selected, a label is 'slapped' onto the carton top before placement on the belt for delivery to the sorter.

Split-case items are batch picked into totes from the other side of the slapper belt. Each tote represents a store that requires a particular stock keeping unit (SKU). Completed totes are released to the belt for sortation.

Meanwhile, large-cube items and other non-conveyables are delivered by lift truck to designated floor locations in bulk storage. These items are later picked either as full pallets or split pallets using paper pick lists prior to direct lift truck delivery to shipping docks.

The facility also contains two pick tunnels. Smaller, non-conveyable items such as ice chests and plastic trash containers are stored in racks. Reserve storage for the pick tunnels is directly above them. These bulky, broken case items are picked into large cartons before delivery by lift truck to shipping docks.

Slow-moving, split-case products are stored in carousels on a mezzanine. Items are placed into totes at processing stations on the main floor and then conveyed onto the mezzanine. Put-to-light is used to deposit products into the system's three pods, each with four horizontal carousels.

Picking in this area works in reverse of putaway. Items are batch picked from the carousels as directed by lights and placed into ten order totes staged at a light-directed put station. Completed totes are released to a conveyor that feeds sortation.

Other receipts are taken to reserve storage pallet racks, where items are held according to pick frequency and the type of pick area they will eventually replenish.

The most active areas of the facility are the nine pick modules. Three modules contain pallet flow racks, each three levels high. These hold medium- to high-volume SKUs that will be picked as full cases.

Two additional modules have pallet flow racks which pick high-volume or large split-case items. Each of these modules has three levels.

Pick-to-light identifies items for picking into order totes, each representing a store. Lights illuminate next to the SKUs that are needed and indicate the quantity to be picked into the tote. Completed totes are pushed off onto takeaway conveyor where they will be automatically scanned and labeled.

Medium to high split-case SKUs are processed in four other modules with case flow racks. Pick-to-light is also used here to select items from the flow racks into totes. Completed order totes also travel by conveyor for scanning, labeling and sorting.

Picked cartons and totes from the various areas feed into a huge 16 to 2 merge located on a third-level mezzanine for induction onto a 700-long sliding shoe sorter that feeds 81 diverts, each dedicated to a store. Sorted items are palletized and automatically wrapped for shipment.

During future peak periods, one million items will pass through Lancaster daily for delivery to what Rite Aid expects will be 850 stores in the region.

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