There's nothing easy about performing value-added services in a DC. Rather than just picking items and sending them on to packaging prior to final shipment, something additional has to be done to the picked items. However, those steps take extra time, effort and are prone to error.

And that is exactly the situation at the footwear and apparel DC on this page, says Bob Babel, vice president of engineering for Forte Industries (800-796-5566), a consulting engineering and system integration firm. A paper list guides picking of a small number of stock keeping units (SKUs) that require price ticketing for a few of the DC's boutique retailers. As Babel points out, all items, which are stored on shelves and floor-stored pallets, must be picked directly to orders rather than more efficiently by batch picking. Once picked, items are brought over to the small parcel processing area for tagging prior to shipment.

In other words, the value-added services operation in this 37,000 square foot DC is bare bones. As demand for value-added services grows, operations will need to change.

Shortcomings

• Time consuming
• Error prone
• Limited productivity

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Upgrade one

As expected, demand for value-added services at the DC did grow. More SKUs and higher volumes forced an expansion to 63,000 square feet. Meanwhile, a major retailer placed orders for limited SKUs that required boxing of each unit and a price ticket.

That called for a change in the materials handling mix. There's more floor storage and shelving now. High-volume item picking occurs in the new carton flow rack.

Orderpicking of value-added service items has been changed to bulk picking. Those items are then brought to a dedicated value-added services processing area and a manual pick line. Items are picked by order, boxed, receive a price ticket and are placed in a shipping carton. After manifesting and compliance labels are applied, cartons are palletized for shipment.

Improvements

• Improved flexibility
• Higher picking productivity
• Better materials flow

Upgrade two

The supplier enjoyed continued success and more major retailers became customers. But now each retailer purchases different SKUs. That means higher value-added service volumes and new requirements such as display hangers. Meanwhile, the company expanded its apparel line.

To keep pace, the DC now has a PC-based warehouse management system (WMS) to organize and process orders. Following instructions from the WMS, wireless terminals direct picking of all items directly to cartons, eliminating bulk picking which is now too cumbersome for the volumes involved. Standard cartons are directed to manifesting. Cartons requiring value-added services are manually sorted to an expanded processing line. Personnel at ergonomic workstations efficiently process cartons prior to releasing them to manifesting.

However, volumes have now grown to the point that requires off-site storage for overflow and off-season reserve stock.

Improvements

• Higher accuracy
• Even higher productivity
• Improved materials flow

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Upgrade three

In time, the big retailers demanded higher volumes and a greater variety of SKUs requiring value-added services.

As a result, DC space doubled to 124,000 square feet and the materials handling mix changed yet again. Conventional storage has been converted to very narrow aisle (VNA) storage to maximize density. Shelf storage for small items continues. A two-level pick module replaces the carton flow rack.

The WMS still directs picking with vehicle-mounted wireless terminals in the VNA area. Handheld wireless terminals do the same in shelf storage. Pick-to-light guides activity in the two-level module. All items coming out of the pick module are automatically sorted to carton closeout or to value-added services processing. Once value-add is finished, dunnage added and manifesting completed, those cartons are released for final sortation to shipping lanes.

Improvements

• Higher speed
• Streamlined handling
• Even higher order accuracy