Distributing merchandise to Duane Reade's drugstores in the New York city's five boroughs and northern New Jersey has been much easier since the company switched from corrugated cartons to returnable plastic containers. The move has reduced damage, increased the ability to track orders throughout the distribution network and improved ergonomics and handling. It has also provided significant cost savings.

"We had spent over $300,000 a year on corrugated and the labor required to erect cartons," says Don Yuhasz, vice president of distribution and transportation. "We recouped that within six months of moving to returnable containers."

The containers (Buckhorn, Inc., 800-543-4454) are used to gather loose-pick drugstore items. They measure 24 x 19½ x 12¾ inches, which is a little larger than the cartons they replaced. The size allows taller products to stand upright for shipment. Duane Reade now has about 32,000 of the containers in its closed loop system.

The switch to returnables came at a time that the company made changes on a number of other materials handling systems at its DC. Conveyors were upgraded and the facility moved to scanning inventory as it was picked. The addition of the containers made handling at the DC much easier.

"We used to get jams on the conveyor constantly with the cartons," adds Yuhasz. "The new containers have pebbled bottoms which make it easy for them to ride on the systems, including our new spiral conveyors."

The containers also have permanent bar coded license plates riveted onto two sides to allow for scanning, which had not been done with the corrugated cartons. Radio frequency data communication based picking is used to gather the loose pick items into the totes, with the location, item and tote all scanned. The tote is then conveyed to a pallet build station where ergonomic grip handles makes it easy to manually stack the totes onto plastic pallets. The pallet also has a license plate that is scanned to marry the totes to it.

Pallets are then shipped to the stores. Upon arrival, the totes are unloaded, emptied and then nested for the return trip back to the distribution center. The switch to returnables has also eliminated the need for the stores to dispose of the 80-some cartons they had typically received in a shipment. Damage has also been greatly reduced.

"We have had an extremely small amount of loss," says Yuhasz. "All you need to experience is the breakage of a liquid item in a corrugated box to see the advantages of plastic—it contains the spill."