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Big Picture: Materials handling comes out of the shadow

Warehousing and distribution are more closely tied to the business than ever before. Here’s a look at the biggest business issues impacting the design and operation of materials handling systems today.
By Bob Trebilcock, Executive Editor
September 01, 2012

For years warehousing, distribution and manufacturing were largely invisible to the corporate enterprise. Of course senior-level executives knew they had plants, warehouses and distribution centers, but they didn’t necessarily know what purpose they served. How else do we explain the trend toward outsourcing manufacturing to contract manufacturers and distribution to third-party logistics (3PL) providers? The attitude was: Let them own all those assets and figure out how to make a profit. (Read more Big Picture articles.)

Today, supply chain processes have come out of the business shadows. Increasingly, the C-level suite recognizes the contribution that warehousing and distribution makes to the bottom line. More importantly, there is the recognition that when done right, warehousing, distribution and manufacturing can create a competitive advantage.

As a result, our industry is more connected to the business than ever before. Finally, we play a role in furthering business objectives. What then are the biggest business issues impacting the design and operation of materials handling systems today? Modern put that question to seven system integrators and consultants to find out what is top of mind with their customers and potential customers.

Forte: Optimizing in a multi-channel world
Multi-channel selling is transforming the retail industry. The challenges are big enough for retailers that once sold through stores and now are selling online. It’s more pronounced for those companies that once sold wholesale and now have their own stores, their own e-commerce shopping carts or both.

The hurdles range from adapting facilities that were designed to handle cases and pallets to piece picking to grappling with SKU proliferation. “We do a lot of retrofit projects for retailers,” says Jeff Ross, vice president of consulting for Forte. “We see semi-automated or automated solutions that worked great when direct-to-consumer was 5% of the business, but now it’s 30% of the volume. We have also seen direct-to-consumer retailers that have opened their own brick-and-mortar stores. Either way, we have to think differently for the client.”

How does that translate to the shop floor? In many cases, it means applying familiar technologies and equipment in different ways to create new processes. “For one retailer, we waited until the packing station to differentiate between e-commerce and retail orders,” says Ross. “We pick in batch regardless of the type of order, but once items hit the sorter, single line orders are sent to one section of the building for packing while multi-line orders are sent to another area for packing.” 

In another application, multi-line orders use a sort-to-light, or put-to-light, process that features a light-enabled cubby wall with spots for a group of totes for outbound orders. Items are picked to a tote that is transported into the put wall area. There, an associate scans the license plate bar code label on the tote to launch the sort-to-light process. As the associate removes and scans pieces in the picking tote, the lights identify the outbound tote that has been designated for that order. Once all the items for an order have been put to the tote, it’s transported to a packing station.

“The technology is not new,” says Ross, “but we’re applying it to a new process.”

About the Author

Bob Trebilcock
Executive Editor

Bob Trebilcock, executive editor, has covered materials handling, technology and supply chain topics for Modern Materials Handling since 1984. More recently, Trebilcock became editorial director of Supply Chain Management Review. A graduate of Bowling Green State University, Trebilcock lives in Keene, NH. He can be reached at 603-357-0484.


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