REI’s Innovative Warehouse Offers One-touch Production

REI’s new Arizona LEED Platinum, Net Zero Energy facility brings together two automation technologies to manage store replenishment and e-commerce fulfillment at the same workstation.

By ·

Recreational Equipment Incorporated (REI)

Goodyear, Ariz.

Size: 393,000 square feet
Products: Outdoor gear and apparel
SKUS: 75,000 SKUs
Shifts Per Day/Days Per Week: 3 shift per day/6 days per week
Employees: 190 employees

The “one-touch production environment” is the operative concept behind the order fulfillment processes at REI’s facility outside of Phoenix. Using Knapp’s goods-to-person station, a donor tote is delivered to one of eight workstations on the mezzanine, allowing an associate to simultaneously process store replenishment needs and fill direct-to-consumer (DTC) orders. That is a different take on omni-channel fulfillment than in most buildings, according to Rick Bingle, REI’s vice president of supply chain, and Bill Best, divisional vice president of supply chain operations. “We reviewed many designs, inventory flows and facilities. Some facilities operated with separate inventories supporting retail and DTC channels. Others used a single inventory but still employed two process designs to support retail and DTC,” Bingle says.

Totes are discretely tracked, scanned and delivered to workstations that include multiple visuals queues and alerts that signal the user if product was placed in the wrong retail or DTC order without the need for a product scan validation. It is the accuracy of the decant process that enables reduced touch and picking velocity at the goods-to-person stations. As an added quality check at the goods-to-person station, a photo eye beam across the totes alerts the associate if they try to put a pick or put an item in the wrong tote.

Elegant and simple, here is how it works.


When conveyable cartons arrive at receiving (1), they are unloaded onto a receiving conveyor and sortation system (2). One of four things can happen.
(1) Cartons with demand at a store are crossdocked directly to retail shipping (3) or to a staging area for crossdocked inventory (4). (2) Product that requires a quality check is conveyed to a secondary receiving station for validation. (3) Product destined for storage in the shuttle system (5) goes to a tote decant station (6), where items are placed into a tote for induction into the shuttle.(4) If there is no need for the product at the time, or if the quantity received is larger than the maximum storage for that product in the shuttle, it will go to a palletizing area for put away into reserve storage (7). Separately, non-conveyables, such as bicycles, strollers and canoes, are put onto pallets and delivered by fork truck to an area that can handle large format products (8).


There are two primary put away processes:
Reserve storage: Cartons conveyed to the palletizing area are scanned to a pallet. Once the pallet is built, the lift truck operator is directed by the warehouse management system (WMS) to a pallet location in reserve storage or the large format area (7 & 8), where he scans the pallet or hand stack carton into a put-away location.
Shuttle storage: Items going into the shuttle system (5) are conveyed to the tote decant area (6). There, an associate scans the UCC-128 label initiating the process. A matching process between the system delivered tote and the product identified by the UCC-128 begins. The associate opens the product carton, scans the UPC bar code and enters a total quantity. If a blind triple match is achieved between the UCC-128, the UPC and the quantity, the associate is directed to load the product into the tote and release the tote to the shuttle system (5). Totes are then conveyed to the induction station for the shuttle, and the warehouse execution system (WES) determines a storage location. The contents are now available to promise.

Order fulfillment:

Once orders are passed from the WMS and pass to the WES, automation takes over. The shuttle system (5) automatically removes totes from storage and conveys them to one of the workstations (9). The system will opportunistically identify DTC order demand and integrate that work-in-process for retail store replenishment at the workstation. That means that if another order for those same items comes in while the tote is traveling to a workstation, it will be associated with that tote.

The workstation includes a display screen, four cardboard shipping containers for store replenishment and an array of overhead pocket sorters for DTC orders. When the tote arrives, the screen displays a picture of the product and the number of items to be picked; a red light serves as a visual queue directing from which tote to select the items displayed on the screen. A green light identifies the correct shipping container. If the associate accidentally places product in the wrong destination, a photo eye will catch the error, freeze the process, and the interface will instruct the user to correct the mistake. When a retail box is full to capacity, the associate will release the carton to an automated lidder and labeling station in retail packing (10) while it is sorted (15) to the retail shipping lanes (3).

The order selector is also directed to fill DTC orders from the same tote. As with retail, the associate receives queues on the screen and lighting providing error protection when moving product from the tote to a pocket in the pocket sortation system (11). Each pocket receives only one discrete item. In the case of a single line, single unit order, this pocket is conveyed directly to packaging stations. For multi-line orders, the pocket sorter collects all items and sequences the pockets into order groupings that are then conveyed together to the DTC packing stations (12).


The system determines whether a DTC order will ship in a carton or a bag and routes them accordingly.
Cartonized orders: Both single and multi-line orders that will ship in a carton are sent to a packing station (12) where cartons are automatically erected and labeled. The packer has the ability to select whatever size box they deem appropriate, but is prompted based on item attributes to select one of four carton sizes. As the packer selects a carton, it is passed by a fixed scanner. The scan associates the order delivered by the pocket sorter to the carton and activates the packing slip printing. Since the item(s) has remained discrete since the decant process, no additional scanning is required. The carton is automatically sealed, labeled and transported to a tilt tray DTC shipping sorter (13) for sortation to the appropriate shipper (14).

Polybagged orders: The process works the same as cartons, except that an automated bagger with labeling is used instead of the carton. The user has the ability to select from two sizes of bags that support the order dimension. Upon completion, bags travel to the same tilt tray sorter (13).
One final step, while the cartons are in transit to the tilt tray sorter (13), the recommended carrier routing that was created before the order was packed is compared with the actual weight and cube to optimize the carrier routing. This allows for a post pick rate shop adjustment to occur, as appropriate.

System Suppliers

Systems Integration, Direct-to-Consumer Tilt Tray Sortation: DMW&H
Building Construction: Renaissance Companies
Warehouse Execution System (WES): DMW&H and Knapp
Shuttle System, Goods-to-Person Workstation: Knapp
Pocket Sortation Systems: Durkopp, a member of KNAPP Group
Conveyor and Sortation: Hilmot
Spiral Conveyor: Ambaflex
Expandable Conveyors: FMH Conveyors (Best Flex)
Warehouse Management System (WMS): Manhattan Associates
RF and Mobile Computing: Zebra Technologies
Fixed Scanners and Dimensioner: SICK
Pallet Rack: Elite Storage Solutions
Mezzanine: Steele Solutions
Stretch Wrap System: Wulftec
Lift Trucks: Crown Equipment Corp.

About the Author

Bob Trebilcock
Bob Trebilcock, editorial director, has covered materials handling, technology, logistics and supply chain topics for nearly 30 years. In addition to Supply Chain Management Review, he is also Executive Editor of Modern Materials Handling. A graduate of Bowling Green State University, Trebilcock lives in Keene, NH. He can be reached at 603-357-0484.

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