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Good, better, best

Gary Forger, Editorial Director -- Modern Materials Handling, 2/1/2003

"Our industry has three or four major players, so having a cost advantage is important to us," explains this month's cover man Tim Beauchamp, senior vice president of distribution for the business supplies company Corporate Express. And he's not alone. In fact, you're probably in much the same position.

And just like Beauchamp, you can't afford to underestimate the importance of distribution efficiencies. But do you know if your operations are good, better or best?

If you're like managers at an alarming number of DCs and warehouses, you just don't have an answer. Sure, you may know how many of yesterday's or last week's orders got out the door, and how many were left behind. But do you know the reason(s)? Do you know the consequences of missing those targets from the perspective of customer service levels, internal costs and productivity, to name just three measures.

Even if you have that information, do you have any idea how you stack up in the eyes of your customers or with other DCs that have similar operations to yours? The benchmarking story on page 36W1 can help you get on the road to finding the answers to these and related performance issues and questions.

Three companies that know exactly where they stand are the winners of this year's MMH Productivity Achievement Awards. Magid Glove & Safety won in Warehousing and Rite Aid in Distribution. The winner in Manufacturing is General Motors Lansing Grand River . Along with many others, they were featured in the pages of MMH last year, and judged best in their categories by our Editorial Advisory Board. We salute the winners for what they have done to push their operations to the highest level.

In the case of Magid Glove, a recent upgrade of its warehouse was a major step forward. "Our efficiencies were poor," says Greg Cohen, operations manager. So the company invested $5 million, its largest capital expenditure ever, to convert its multi-story manufacturing building into its new warehouse. Same-day order processing is now the norm. With paperless order processing, accuracy is better than 99%, and information is available in real time. Meanwhile, labor was reduced 30% with a corresponding increase in productivity.

Rite Aid, on the other hand, won for a new facility on the edge of California's Mojave Desert. It now makes 99% of deliveries to its 425 stores on time. Accuracy is 99.6%. And in its first year of operation, the DC increased productivity 36% by making better use of its materials handling equipment, says Mark Gullo, project manager.

Knowing where you stand on the good, better, best scale doesn't have to be a mystery. And if you already know you're on the top rung, tell us about it. You could be an award winner a year from now.

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