For Dallas-based Winzer Corp., strong growth despite a slumping general economy was a mixed blessing.

'As we grew 12% a year, the only way to keep pace with the increase in orders was to throw more bodies into the distribution center. Unfortunately, you could see the diminishing returns,' explains John Carney, president of the $40 million a year fastener distributor.

For every increase of 50 orders a day, Winzer added a new orderpicker, recalls Jeff Wolfe, director of operations. While that kept pace with the order rate, it didn't do much for profits.

That put Winzer at a crossroads. Moving to a larger facility was a possibility since space was tight in the 64,000 square foot facility. But Carney decided to stay put and make better use of the space.

Just over a year ago, the distributor traded in its manual order processing system and shelving for a semi-automated handling system (SK Daifuku, www.skdaifuku.com). While shelving is still used extensively, orderpicking in those areas is now directed by wireless terminals rather than paper lists. Meanwhile, a two-aisle mini-load automated storage and retrieval system (AS/RS) manages 10,000 of the company's 40,000 stock keeping units (SKUs) in half the floor space previously required. High-demand SKUs are located in a 660 location pick-to-light area.

All DC activities are directed by a new warehouse management system (WMS). Wolfe says the software has significantly increased inventory visibility while improving Winzer's ability to update order status, improving the flow of orders through the facility.

Process improvements of the new system have been impressive, says Wolfe. Even as orders have continued to climb, 25% fewer orderpickers are needed today. Meanwhile, the time to fill an average order has dropped 55%. Those two gains get more orders out the door faster than ever, a requirement as the business grows.

Winzer is also on track for a 3½ year payback for the $2 million investment. 'Which is pretty darn quick,' Carney adds.

While Carney says the payback on the new system is the highest accomplishment of the system, Wolfe, who runs the DC, is most enthusiastic about the new efficiencies.

With the old system, orderpickers were handed picking labels that identified parts, quantity and location in the maze of shelving. Picked bags of fasteners were placed in carts that workers pushed from location to location. Walk time was considerable before all the picks were made in that batch. In the packing and shipping area, picked bags were 100% quality checked before being allocated to orders for shipment.

In the new system, picking of bags is still slowest in the shelving areas but has been speeded up with the use of wireless terminals. The WMS directs orderpicker movements to save time. While an average order of 13 line items once took 15 minutes to pick, it is now done in 7 minutes, explains Wolfe. Details on overall DC operation accompany the system layout drawing below.

In addition, the WMS now tracks the productivity of each employee. 'A capability we didn't have before but needed,' adds Wolfe. In fact, he didn't even have a handle on how long it should take to fill individual orders with the old system.

That's all changed. Productivity of all workers is posted daily in the break room, resulting in healthy peer pressure on each other, Wolfe says. Availability of that data has also made possible a bonus system for top performers.

A major challenge in getting to where Winzer is today was installation of the new system as the DC continued to pick, pack and ship orders to schedule. Automating on the fly could have been disruptive, but Winzer 'never missed an order because of the installation,' says Wolfe.

The key, he says, was careful upfront planning. Carney and Wolfe say that included determining the sequence of the install but having people from all key departments at Winzer and the supplier talk early and often.

A night crew was hired to move shelving and inventory, first making room for the mini-load, then the pick-to-light. Prior to going live with the new system, it was tested on three successive weekends to get people used to the new operation. Then on Monday, they would return to the old system. Even when the switchover was completed, software for both systems ran for 30 days just in case.

In retrospect, Winzer made the move to its semi-automated system just in time. Carney says the company is currently growing 15% this year, and just bought another distributor. The new system is expected to meet Winzer's needs for a decade.

Click on the icon to read how Coty uses pick-to-light.