Toll goes e-commerce – from MHD magazine

Toll Group’s new $160 million retail and e-commerce order picking and distribution centre in western Sydney is designed to support the growth of online shopping by processing orders faster and more cost-effectively.
The 32,000sqm DC has 15,600sqm of automation equipment, which picks, processes and packs up to 375,000 items per day, reducing delivery times from days to hours.
Commenting on the project Toll Global Logistics president Chris Pearce said today’s market is placing aggressive demands on retailers to provide fast order fulfilment and delivery, without increasing costs.
“Toll’s investment in the new facility is helping our customers adapt to the new retail environment. The facility is equipped with advanced automation technology so retailers can deliver their e-commerce  orders faster, and in a much more economical way,” said Mr Pearce.
“Retailers will benefit from the ability to deliver goods to their stores and direct to customers faster and more cost-effectively. And shoppers will enjoy flexible order times and faster order processing, receiving their purchases within hours, not days.”
Fashion retail DC
The facility was constructed in collaboration with a major apparel retailer as the anchor tenant. Toll, Dematic and the client collaborated to design the facility with scalability and future growth in mind.
Toll is constantly looking to improve its omni-channel service for customers. This includes offering faster and more convenient delivery options for online and ‘click and collect’ orders.
The new DC offers complete omni-channel capability to help retailers adapt to the changing needs of customers and operates as a shared, multi-user facility.
Safety and environmental initiatives include a 70% reduction in manual handling, packaging optimisation and recycling, LED lighting and rainwater harvesting.
The site is ideally positioned on the corner of the M5 and M7 tollways, enabling convenient transport links for NSW and interstate deliveries.
The DC commenced operations in December 2017.
Toll transitioned customers through that peak period, and was fully live by the end of January, ahead of schedule.
Automated replenishment
Distribution in the DC starts at the receiving door. Cartons are unloaded from shipping containers and moved into storage, before being transported by a fleet of 10 Dematic automated guided vehicles (AGV) to the decant area.
Six double-pallet AGV are used for longer distance runs, together with four single-pallet AGV, which have been customised for the facility to provide additional safety processes around interaction with the decant tables.
The single-pallet AGV take the pallet from the handover point from the double-pallet AGV onto turntables, from which products are decanted and transported into the automation system.

“The new DC offers complete omni-channel capability to help retailers adapt to the changing needs of customers and operates as a shared, multi-user facility.”

AGV benefits
A key benefit of using AGV over forklifts for repetitive materials handling tasks is that they are predictable. They are safe, don’t take breaks, and they efficiently handle repetitive tasks.

“At the moment we are in the process of scaling up,” said Leon Land, senior product manager at Toll.
“We’ve got the ability to add capacity, extra shifts and extra hours within the time frame that we currently operate.
“The DC typically operates 12 hours a day, 5 days a week. The facility is operating at the moment with our anchor client, which is about 50% of the capacity.
“Within the scope and design of this facility, we’ve allowed for seasonality. We can scale up. We can add hours, shifts and weekends to satisfy our customers’ needs.”
He added: “A typical day at the moment is about 80,000 order lines. This utilises about 50% of the design capacity, which is around 170,000 order lines per shift.”
 RapidPICK GTP pick stations
To achieve this, the automated order fulfilment system includes 24 Dematic RapidPICK goods-to-person (GTP) pick stations. Products and order cartons are delivered to operators in a precise sequence, allowing for very high picking efficiency and accuracy.

“Employees are very happy with the new system,” Mr Land said. “It’s ergonomic, safe and there will be no horror stories of people walking mile after mile looking for products in the DC.”
The new GTP pick stations are very intuitive, easy to learn and operate. Users manage their processes via touchscreens, so it is very easy for Toll to train a new team member on the system.
Products arrive at the pick stations from 24 aisles of Dematic Multishuttle, which provides high-density storage and is capable of supplying products in the correct sequence for order fulfilment, at high rates.
Cardboard cartons are created in two sizes by automated carton erectors, with a licence plate applied on creation. These are then held in one of six Multishuttle order buffers ready for release to the pick stations.
Orders are picked and packed at the 1:1 Dematic RapidPICK stations.
“When all items for an order have been picked, order cartons are transported by conveyor via QA and automated invoice insertion to order finishing areas for either e-commerce  or store orders,” said Toll’s general manager for specialty retail Robert Charles.
“Store order cartons go through automatic carton optimising machines, where the carton is cut down in size to suit the fill level, reducing transport costs. Completed order cartons may be held in a Multishuttle pack and hold buffer, before being transported via the despatch sorter and directly loaded into Toll trailers.
“E-commerce  orders are transported to an automated packing bench with semi-automated satchel bagging machines. Satchels are then loaded into despatch cages, and loaded into the back of vehicles with minimal handling,” said Mr Charles.
The facility specialises in split case and full case picking, and currently operates from 6am to 6pm, which caters for the DC’s cut-off times to make sure Toll gets its online and other deliveries to customers on time.
The head contractor
“Dematic’s ability to support us on this project was what led us to them,” added Mr Charles.
“We collaborated very well. We put together a very strong project team to deliver this project.”
“We transitioned our customer during their peak Christmas period and we wouldn’t have done that if we didn’t have the confidence in our new systems and processes,” said Toll’s Leon Land.
“Dematic brought a very strong sense of how to deliver a highly automated supply chain and integrated logistics environment to us.
“We understand these things as a third-party company, but putting together and integrating all the automation, all of the third-party equipment, and bringing that schedule and compressing that schedule and keeping it on track was vital expertise that Dematic brought in this process.”
“Naturally, we’re very proud of the DC,” added Mr Land.
“It’s a highly automated facility. It’s changed the way we operate within the retail environment and everyone who has been involved in the project is very proud of the outcome.”

“A lot of work was done in the first 18 months evaluating multiple options and technology, whether it would be fully or semi-automated.”

Three years in the making
The DC was three years in the making and went live in December 2017. However, a lot of work was done in the first 18 months evaluating multiple options and technology, whether it would be fully or semi-automated.
“Toll looked at the business case justification, and once we got to a point where we agreed that the DC was going to be a fully automated integrated logistics centre, not only for our core customer, but also for other customers, we built at twice the capacity so that we could fulfil requirements for multiple customers,” said Mr Charles.
When evaluating a solution of this nature, Toll takes many disparate factors into consideration. It looks at customer service levels and, for Toll, how to reduce total costs, which is a big part of why businesses make decisions and realise commercial benefits.
“Safety is, of course, our number one priority on site,” he said.
“We work in an environment where there’s a lot of moving equipment, so we’re always looking at ways to segregate personnel from equipment and machine operations, and minimise the potential for accidents,” said Mr Land.
 Toll
The Toll Group operates an extensive global logistics network across 1,200 locations in more than 50 countries. 43,000 employees provide a diverse range of transport and logistics solutions covering road, air, sea and rail to help customers meet their global supply chain needs.
Toll Global Logistics has its own in-house integrated logistics capability. Toll’s team will evaluate an operation and that takes into account the operational requirements, the commercial requirements and the technical.
“After Toll develops the concept and the design levels and throughputs, we engage the market,” said Mr Charles.
“Dematic was a good choice for Toll because we’ve worked with Dematic in the past on a similar facility. There’s a good cultural alignment between Toll and Dematic, and it’s all about the people within the teams to be able to deliver something like this successfully,” he said.
“Once we selected Dematic as a partner, we had two joint project teams to execute the solution, so their involvement and their input into the solution was very detailed.”
In that detailed design phase, a lot of the input was around IT functionality, processes, and Toll understanding what needed to change from the concept to be able to accommodate some of the automation that it was looking to put in, such as Multishuttles and goods-to-person (GTP) stations.
Dematic’s multi-faceted role
“We had a lot of input from Dematic on third-party equipment, such as the carton-optimising machines, which deliver our customers fantastic benefit in terms of our outbound transport.
“Thanks to our carton-optimising system, we have the ability to reduce the carton sizes and ship 30% more cartons in the containers,” said Mr Charles.
“Dematic had a lot of involvement in terms of the IT functionality – the detailed design of the solution and the system – with regards to how do the Multishuttle system and the GTP stations work efficiently together, to ensure we would achieve peak productivity and accuracy,” he said.
“When we looked at the design of the facility, we had to take into account multiple retail customers.”
Flexible system designed for growth
“Some retailers are dedicated store retailers. We have others that are wholesale retailers who deliver to other distribution centres, and we also have retailers that have a large e-commerce  component,” said Mr Charles.
“Our anchor tenant has over 1,000 retail stores. Our second customer is a wholesale business.
“This business is delivering into other distribution centres that then deliver to its network of stores, and this customer also has a very large e-commerce  component. Toll has a lot of customers who have a fashion retail background, so the distribution profile for this facility caters for any fashion retail customer in the industry.”
“However, this site is also capable of handling any retailer,” added Mr Charles.
“So, if the retailer was a stationery retailer or in another line of retailing, the solution that we’ve implemented can cater for that.”
“The facility with the automation that has been implemented is mainly a unit pick-and-pack operation: between 95-98% of the volume goes to the automation as it’s picked at unit level,” explained Mr Charles.
e-commerce  driving growth
“Between 10 and 15% of volume is e-commerce-driven and the growth across the sector is immense,” he said.
“This is one of the key factors we had in mind when we designed the facility. Scalability and flexibility is key in any 3PL. We have multiple customers, their businesses change every year and we have to be able to evolve with them.
“If we look at what we’ve built here, we’ve built two facilities. We’ve got a fully automated one which is Project Enterprise, however, we also have a manual facility across the hard stand, which also has a lot of other customers.
“Therefore, if we need to expand, we have the ability to expand the automation, which gives us the flexibility to grow, or contract, depending on what we need to do,” concluded Mr Charles.
For more information visit www.dematic.com/en-au. You can also watch a video of this DC in action at https://youtu.be/m6iOqRH8NX8. ■

Automation in APAC: trends for 2019

Jon Young

From the most recent smartphone to the latest fashion, keeping up-to-date with trends can be tiring. In the manufacturing industry, future-proofing your factory may seem like a daunting task, especially as parts become obsolete as quickly as new advancements emerge.
Asia Pacific countries can expect a surge in workplace automation, including the use of artificial intelligence (AI) and robotics, over the next three years. According to research from Willis Towers Watson’s Global Future of Work Survey, automation is set to account for around twenty three per cent of work being done across the region.
This compares with thirteen percent of work using AI and robotics today, and just seven per cent three years ago. With this growth in mind, how should manufacturers adapt to stop them from falling behind?
Visualising maintenance
Virtual technology has been around for a while, and is most often associated with design and entertainment industries. However, augmented reality (AR) and virtual reality (VR) have been breaking into industrial environments over the past few years, and this growth is set to continue.
Enabled by the increased networking of equipment, such as programmable logic controllers (PLC) and supervisory control and data acquisition (SCADA) systems, predictive maintenance uses data obtained by sensors to monitor the condition of equipment. By analysing this data, engineers can predict when equipment parts may need servicing or replacing, allowing them to intervene before the system fails.
AR and VR take things to the next level. By using a smart device, maintenance engineers can create a digital representation of a fault and, more importantly, the solution. This level of maintenance will allow engineers to pinpoint exactly where a system may fail, ensuring the correct replacement part is ordered well in advance.  EU Automation can help your maintenance plan stay ahead of the game by delivering parts worldwide and within 48 hours, meaning broken equipment will never have to put manufacturing on hold.
Going retro
When thinking towards the future, the phrase ‘out with the old, in with the new’ may spring to mind. This doesn’t always need to be the case. As complete upgrades can be costly and time-consuming, many manufacturers will continue to teach older machinery new tricks with retrofitting.
Industrial components that are coming to the end of their service life are always at risk of causing unexpected downtime or delays to production. Retrofitting improves machine reliability by replacing older components with more advanced equipment.
Integration doesn’t need to break the bank. As production rates are so high, some components become obsolete after only a few years, making them an economical option.
Getting personal
One size no longer fits all. Over the last decade, the design-it-yourself business model has snuck quietly into the manufacturing market. Even major producers like Nike and Adidas offer specialised web portals that allow customers to design footwear personalised to their own aesthetic and functional needs.
Thanks to other key innovations in the industry, such as cloud computing, artificial intelligence and 3D printing, automation will continue to take the desire to differentiate to a mass scale.
But mass customisation puts pressure on manufacturing companies to up their game in nearly every aspect of their operations, from customer sales to crafting flexible yet cost-effective custom manufacturing processes. Manufacturers must be lean and adaptable to deliver variations on products and quickly respond to changes in requirements. It will be of no surprise therefore, if machinery were to feel the impact.
As automation advances, keeping on top of the latest trends may seem tricky. However, preparing for what 2019 has to offer can be made simpler. EU Automation’s fast delivery time guarantee means your new part can be with you on the same day, minimising downtime when integrating new and old technologies.
Jon Young is the sales director of obsolete equipment supplier EU Automation.

Welcome to the future – from MHD magazine

Michiel Veenman

What will the warehouse of 2030 look like? 12 years may not sound like a long time, but with the pace of change being faster than ever before, companies need to start planning now, in order to keep up with ever-increasing market demands.
As people begin to have more disposable income and higher expectations for fast delivery, existing distribution networks may be stretched beyond their capacity to adapt.
E-commerce is a key driver for logistics and warehousing technology as consumers expect rapid responses to order placement. Technology is being driven to pick smaller quantities at an increasing rate.
It’s crucial for the supply chain, logistics and warehousing industries to examine current trends and see how they can best adapt to the changing needs of the market.
Trends in society
The goods that make their way through supply chains ultimately end up with consumers, and consumers not only drive demand, but set expectations for delivery. That makes it valuable to quickly review the macro changes occurring in society as we consider the warehouse of the future. Major trends include:

  1. Aging population

In the coming years, global demographics will change due to increasing life expectancy, declining fertility rates and rising levels of education. The number of people older than 65 is expected to double in the next 25 years, reaching 13 per cent of the global population. This will impact global productivity, personal savings and the labour force. It will also change consumption and spending behaviour on a global scale, impacting production, logistics, warehousing and retailing.

  1. Expanding middle class

The global middle class is projected to more than double between 2009 and 2030, rising from less than 2 billion to nearly 5 billion people. The middle class will then account for 60 per cent of the world’s population (ESPAS, 2015, p.19). Formerly poor populations, while still lagging behind developed countries, will have more purchasing power and greater access to information and communication technologies, and enjoy greater mobility (ESPAS, 2015, p.20).

  1. Urbanisation

Urban population is expected to pass 6 billion by 2045. In 2015, 54 per cent of the world’s population was living in cities; by 2050, that will reach 66 per cent. It is predicted that by 2030, the world will have 41 mega-cities with 10 million inhabitants or more. These developments will impact where goods are produced and consumed.

  1. Growth of the sharing economy

Uber, Airbnb and TaskRabbit are examples of the rapid emergence of the sharing economy. According to PwC, the five key sharing sectors — travel, car-sharing, finance, staffing and music/video streaming — have a potential to generate global revenues of $335 billion by 2025 (PwC, 2015). The concept is already being extended to the construction industry and sharing will eventually come to logistics with its heavy assets and infrastructure.

  1. Globalisation and de-globalisation

Globalisation is the increased movement of goods, capital and workers across national boundaries. Today it is common for companies to develop a product in the United States, manufacture it in China and sell it in Europe or Africa. Some experts also note the value created by the global flow of data and communication, which is often referred to as globalisation 2.0. According to McKinsey, “data flows enable the movement of goods, services, finance, and people. Virtually every type of cross-border transaction now has a digital component.”
While globalisation continues to advance, a counter-movement is also emerging as nationalism and the desire to source products locally, particularly food, grows. This de-globalisation is already impacting the decisions consumers in some markets are making about the products they purchase.

  1. Increased connectivity

The increasing connectedness of people and information is creating greater transparency, better information provision, more critical thinking and more creative and dynamic individuals. It is assumed that pressure for greater accountability and transparency at the different levels of governance — and within industry — will increase.

  1. Changing labour market

With global population growth in developing countries and population aging in developed countries, the demographic landscape is changing at the international level. The projected change in working-age population predicts an explosive workforce growth of nearly 1 billion in the developing countries, mainly driven by high fertility rates. The opposite trend is predicted for the most advanced economies, with a future decline in the working age population (Rand, 2015, p.15). In the short term, this is increasing the value placed on ergonomics and other factors that increase worker satisfaction in developed countries where the labour force is shrinking. In the longer term, China and India may gain importance, whereas Europe may lose traction in global governance and economy (Rand, 2015, p.16).

“It’s crucial for the supply chain, logistics and warehousing industries to examine current trends and see how they can best adapt to the changing needs of the market.”

Trends in logistics
The supply chain is being impacted by a number of trends resulting both from the broader changes in society and advances in technology. These include:

  1. E-commerce

One of the biggest current trends already creating significant disruption in the supply chain is the continued growth in e-commerce. In Europe, the average share of e-commerce in retail was 7 per cent in 2015, 8 per cent in 2016 and projected to reach 8.8 per cent in 2017. Globally, retail e-commerce is expected to increase to 14.6 per cent of total retail, with a market volume of more than $4 trillion (eMarketer, 2016).

E-commerce has continued to experience high growth rates, in part by shrinking the time between order and delivery. Early in its development, consumers often waited a week or more to receive their orders. While this may still be the case in some specialty categories, major e-commerce players now routinely offer two-day delivery on many orders, while next-day and even same-day delivery is increasingly common. This is creating higher expectations among consumers and, as e-commerce expands to new categories such as food, delivery times are continuing to be compressed and e-tailers are exploring multiple options to consistently achieve next day or same day delivery.

  1. Anticipatory logistics

Anticipatory logistics is a process that foresees which logistic services will be needed in the future and in which region. The area where anticipatory logistics has already developed is anticipatory shipping. This allows online retailers to predict orders before they have occurred, based on previous customer behaviour data. This information is then used to ship or move goods closer to the potential customer to enable faster delivery. In the future, we will see anticipatory logistics extend across the value chain.

  1. Customer-centric production/batch size of one

In the future, the customer will increasingly become the centre of production. The result will likely be more localised production, as customers do not want to wait for their individualised product. The trend of 3D printing will drive both the individualisation and the localisation of production. The Adidas Speed Factory in Germany, which allows customers to customise their shoes, is an early example of this trend. (Adidas Group 2015).
The impact on warehousing and logistics are significant: these customised shoes never see a warehouse; they are shipped directly from the factory to the customer, reducing the need for warehouse space. However, the logistics required to support individualised production increase.
Even if we are not yet at a point where ‘batch-size-one’ production is feasible for most products, it seems likely that as this trend develops, companies will move production closer to their customers, and focus on next-shoring and near-shoring.

  1. Omni-channel logistics

Consumers are already using multiple channels for their shopping. They start and end their buying journey at different points and expect lots of information, a certain delivery speed and personalised experiences. This is creating opportunities for retailers to merge the different channels and optimise the whole journey for a customer, rather than optimising each channel separately (DHL Trend Research, 2015).
From the retailers’ perspective, omni-channel logistics can achieve an increase in customer base and loyalty, and also improve profitability. Shoppers using multiple channels for their shopping spend 15-30 per cent more than traditional shoppers.

By 2030, the omni-channel journey of a customer will move further, and the channels might be even more diverse than today. Home delivery is currently the most preferred mode of delivery — nearly 70 per cent of all online shoppers make use of it. Yet around 50 per cent of them have already experimented with buying online and picking up in a store. In a survey by PwC in 2017, 33 per cent of shoppers were open to kerbside pickup, and 28 per cent to pick up at a third-party location. These modes are commonly referred to as ‘click and collect’ and experts assume that these models will grow even more (PwC, 2017). As noted in DHL’s 2015 Trends Report:
“Looking ahead, we expect to see the physical assets of logistics networks being virtualised and managed much more dynamically in line with customer demands. It is also anticipated that there will be more focus.”

  1. Same-day (or faster) delivery

As noted earlier, e-commerce has continued to grow by shaping and meeting consumer expectations for faster delivery. The next frontier is same-day delivery. According to DHL’s 2017 Trend Research: Sharing Economy Logistics report, “41 per cent of US consumers have used programs offering same-day, expedited, or on-demand delivery services.”
Other studies show that 20 to 25 per cent of consumers would pay significantly more to receive items on the same day. These premiums would be up to 3 Euro, 20 RMB and 3 US dollars for the respective regions. Assuming that the customers would have to pay the full costs for this fast delivery, only around 2 per cent of all customers would be willing to pay more than that. McKinsey experts predict that “same-day and instant delivery will likely reach a combined share of 15 per cent of the market by 2020” (McKinsey, 2016, p. 9).

“Industrial IoT networks will soon become an essential component of efficient warehouse management as they provide the connectivity and data on which the smart warehouse will depend.”

Emerging technologies
Emerging technologies will play a significant role in shaping the warehouse of the future and supporting faster delivery. The major technology developments on the horizon include:

  1. Drones

Leading companies like Amazon and DHL are actively exploring the potential of drones and filing patents for the use of drones in logistics. Amazon has patented an idea for an airship that can launch drones over larger cities. At the same time, many people see issues with thousands of drones flying over a city. These include traffic congestion, noise and an obstructed view of the sky. Energy-wise, flying is the most inefficient means of transportation.

In 2030, drones should play a role in the supply chain, although legislation could delay their application. The greatest potential may be in non-urban areas where drones would allow consumers to get the same high-speed, i.e., 2-hour delivery, as is possible in cities.
In addition, larger drones may play a role in connecting cities and even doing long-haul cargo flights. Inside cities, drones could play a role in ultra-high speed or short-distance deliveries. What percentage of parcel deliveries drones will carry in 2030 is still uncertain, but any future distribution plan should be designed to interact with drones.

  1. 3D Printing

3D printing will significantly change the way many products get to market. The most common 3D printing application today is small plastic parts. This is still a slow and, therefore, expensive process, but should become radically cheaper and faster as the technology matures. Plus, more advanced machines that can print complex parts of multiple materials, including metal, will emerge. There are even companies creating machines that will enable 3D printed food. By 2030, it is possible that we will see a three-tier approach to the use of 3D printing:

  1. Some consumers will have cheap, easy-to-use 3D printers that allow them to print small plastic parts based on licensed 3D models they buy online. This would apply to things like replacement parts for home appliances, a plastic case for a mobile phone or toys for children.
  2. For less tech-savvy consumers, or larger, more complicated parts, there will be ‘print shops’ in cities. Consumers could either send their digital designs to be printed or order a product online and never know it was printed on-demand for them. Ideally these print shops would be integrated into urban distribution centres.
  3. Complex industrial applications, which use multiple materials including metal, would be supported by sophisticated 3D printers within manufacturing or service centres.

 
3. Autonomous vehicles
Autonomous guided vehicles (AGV) have been used in warehouses for 30 years. In the next 10 years, the use of AGVs in warehouses will grow exponentially.
There are several drivers behind this trend. First, there is an increasing demand for flexibility in warehousing. Changes in processes, product ranges or distribution channels are all impacting warehouse requirements. Traditional, bolted-down automated conveyor systems are not able to adapt to these changes. AGV provide the required flexibility.
The other driver is the simultaneous decrease in cost and increase in performance of AGV as the core components increasingly support consumer products, such as robotic vacuum cleaners and automated lawnmowers. The economies of scale are much greater for consumer products than for warehouse technology and could drive down the costs of the underlying technologies, such as sensors and navigation systems, used by AGV. A similar impact could result from the technologies used to support self-driving automobiles.
Where early AGV still relied on fixed infrastructures, such as reflectors, floor markings or tags, the technology is available today to allow AGV to navigate with the help of on-board radar and camera systems. Intelligent software and self-learning capabilities interpret the images and instruct the vehicle where to go. This makes the systems plug-and-play and, therefore, easy to deploy and more flexible.
Replacing a large conveying system with flexible AGV could require hundreds or thousands of small AGV operating together. This would have been impossible in the past, but today, and certainly in 2030, the combination of peer-to-peer communication, faster wireless networks and cloud-based processing power enable coordinated operation. As the technology progresses, advances in sensors and electronics will allow AGV to move faster, even when interacting with people.

  1. Mobile robotics

In this context, a mobile robot is an AGV with a robot on top. This allows the robot to drive through the warehouse to where products are stored and retrieve them. For this to work effectively, these robots need robust navigation, vision systems and multi-functional grippers. A level of artificial intelligence is also required to deal with the near-infinite variety of products, shelf configurations and product placement. All of these supporting technologies are advancing rapidly.

  1. IoT connectivity

As more sensors are installed in machines and processes, the opportunity exists to connect groups of machines or entire facilities into IoT networks that provide visibility into product movement and enable capabilities such as predictive maintenance. Industrial IoT networks will soon become an essential component of efficient warehouse management as they provide the connectivity and data on which the smart warehouse will depend.

  1. Big data

Big data programs are already shaping everything from marketing to forecasting. They will also drive key advances in logistics, such as the predictive shipping model discussed earlier and will enable machine learning as the integration of real-time and historical data is what allows machines to continually improve their operation based on past actions.
This article is the first in a two-part series. The next article – to feature in the next edition of MHD magazine – will examine the impacts these trends and technologies have on distribution; what the distribution centre of 2030 will look like; scale, flexibility and the need for automation; and pose a key question of ownership: who will own and operate the distribution centres of the future?
Michiel Veenman is the head of the competence centre, warehouse and distribution solutions at Swisslog. Michiel is responsible for the development of some of Swisslog’s next-generation solutions. Michiel has over 20 years of experience in intralogistics with roles varying from consulting, design and project management to market strategy and innovation. For more information visit www.swisslog.com.
 

Narrow aisle reach AGV for freezers

Dematic has released a freezer-rated narrow aisle reach AGV specifically designed to operate autonomously in chilled and freezer environments. The AGV can operate permanently in temperatures down to -25°C and intermittently as low as -30°C.
With a lift height that can access five levels of racking in a typical warehouse, a 1,100 kg load capacity and a reach mechanism to handle double-deep racking , the AGV is well-suited for automating operations in existing freezer distribution facilities.
“Our new AGV are designed for automating existing freezer storage DC that are manually operated today,” said general manager sales for AGV at Dematic Australia and New Zealand Tony Raggio. “Companies can implement freezer-rated AGV for automated picking with minimal infrastructure changes and related costs.”
For manual operations, working in the tough, demanding freezer environment means that workers need frequent breaks from the cold. For every hour worked, a worker might need to spend 10 to 20 minutes out of the freezer. AGV systems may operate 24/7, picking and transporting product in the frozen environment and delivering that product seamlessly to warmer temperature shipping areas.
“Finding people to work in chilled and freezer environments is challenging,” Mr Raggio added. “Our customers can use these AGV in the frozen areas of their distribution facilities to create a fully automated ‘lights out’ automation arrangement.”
 

Coles goes for all-out automation, to be demerged from Wesfarmers

Coles has entered into a Heads of Agreement with Witron Australia, the Australian subsidiary of Witron Logistik + Informatik GmbH (Witron), to develop two new automated ambient distribution centres for Coles over a five-year period. Witron has developed over 50 automated projects for major retailers around the world.
Wesfarmers managing director Rob Scott said the decision to make this investment followed an extensive evaluation process and assessment of global best practice to ensure that the project supports Coles’ strategy over the long term.
“We are pleased to partner with Witron to invest in world-class technology to modernise Coles’ supply chain,” Mr Scott said. “Following a comprehensive review of all options, this investment is expected to deliver significant productivity improvements over the medium to long term.”
Coles managing director Steven Cain said the investment demonstrates Coles’ commitment towards modernising its supply chain, which delivers more than one billion cartons to stores each year, through investment in technology and automation.
“Coles is committed to improving efficiency and stock availability in stores and delivering higher service levels for our customers,” Mr Cain said. “The investment we are making in this technology is expected to lower supply chain costs, provide safer working environments and enhance our business competitiveness.”
The total investment required to develop the two new automated ambient distribution centres will be managed within Coles’ overall capital expenditure budget by applying its established capital allocation processes and return hurdles. Future capital expenditure requirements associated with this investment were taken into account in determining the appropriate level of net debt for Coles as a standalone company, and the investment is supported by the incoming Coles Board.
The 2019 financial year capital expenditure associated with this project is included in Coles’ net capital expenditure guidance of $600 million to $800 million. Coles expects to recognise provisions of approximately $130 million to $150 million before tax in the 2019 financial year, relating to redundancies and lease exit costs for a number of existing distribution centres that will be closed over a five year period.
Demerger details
The Supreme Court of Western Australia has ordered a meeting (Scheme Meeting) of Wesfarmers shareholders be convened to vote on a scheme of arrangement for the proposed demerger of Coles.
If the demerger proceeds Wesfarmers shareholders will retain their Wesfarmers shares. Eligible shareholders will be entitled to receive one Coles share for every Wesfarmers share held at the demerger record date.
Wesfarmers chairman Michael Chaney said: “Demerging Coles enhances Wesfarmers’ prospects of delivering satisfactory returns to shareholders by shifting our investment weighting and focus towards businesses with higher future earnings growth prospects,” Mr Chaney said.
“Following a successful turnaround since it was acquired by Wesfarmers in 2007, Coles is once again a leading Australian retailer, well positioned to grow as a defensive business with strong investment characteristics.”

  • Demerger of Coles to reposition the Group’s portfolio and set up both Wesfarmers and Coles for future success.
  • Wesfarmers to retain 15 per cent of Coles and 50 per cent of flybuys.
  • Eligible shareholders will receive one Coles share for every Wesfarmers share.
  • Wesfarmers Board recommends shareholders vote in favour of the demerger of Coles.
  • The Independent Expert, Grant Samuel & Associates, has concluded the demerger proposal is in the best interests of Wesfarmers shareholders.
  • Shareholder vote scheduled for Thursday, 15 November 2018, with demerger to be completed in November 2018, subject to shareholder, court and regulatory approvals.

Wesfarmers following the proposed demerger
Wesfarmers managing director Rob Scott said the demerger represented a significant repositioning of the group’s portfolio and would set up Wesfarmers for success over the next decade.
“The demerger will reposition the group’s portfolio to target a higher capital weighting towards businesses with strong future earnings growth prospects,” Mr Scott said. “After the demerger, Wesfarmers will have a portfolio of cash generative businesses, with strong returns on capital, good momentum and leading positions in their respective markets.”
“Maintaining a strategic stake in Coles provides an important connection with Wesfarmers to reinforce opportunities to collaborate in the data, digital and loyalty areas. flybuys will be better able to realise its potential as a leading loyalty company through the ongoing support and investment of both Coles and Wesfarmers and by leveraging the broader networks of the Wesfarmers Group, including the existing partnerships with Kmart and Target,” Mr Scott said.

XPO Logistics to deploy 5,000 collaborative warehouse robots

XPO Logistics plans to deploy 5,000 intelligent robots throughout its logistics sites in North America and Europe. The robots, designed to collaborate with humans, will supplement XPO’s existing workforce.
Chief executive officer of XPO Logistics Bradley Jacobs said: “We’ve developed our logistics technology to integrate the latest intelligent automation and adapt it at lightning speed. This allows us to dramatically improve fulfillment time and cut costs. The addition of 5,000 collaborative robots will make our logistics operations safer and more productive in picking, packing and sortation. These are important benefits for our customers – particularly in the e-commerce and omnichannel retail sectors, where order speed and accuracy are essential ways to compete.”
The autonomous robots are part of a modular goods-to-person system that also includes mobile storage racks and fulfillment stations. Each robot can move a rack weighing approximately 450 to 2,000kg, bringing it to a station where a worker picks up to 48 orders simultaneously. The entire process is controlled by XPO’s proprietary warehouse management system. This high-speed, flexible solution supports same-day and next-day deliveries by shortening order-to-shipment times and helping workers minimise walk-time and manual errors.
XPO’s latest robotics implementation is part of the company’s planned $450 million investment in technology this year. Other recent installations include the XPO Direct shared-space distribution network, voice integration with Amazon Echo and Google Home to track the last mile delivery of heavy goods, and the XPO Connect digital freight marketplace with multimodal infrastructure.
 

Manufacturing: 1/3 to be automated within 3 years

A third of manufacturing is expected to be automated within the next three years, according to a report investigating the rise of technology and the impact of Industry 4.0.
The report from SSG Insight reveals one in eight (12%) of manufacturers are going further with their technological evolution, by preparing to automate up to 50% of their business in the same time frame.
Artificial Intelligence (AI) is predicted to help automate internal areas within manufacturing businesses, primarily aligned to the production and manufacturing process including the decision making required to optimise operational performance. AI will also be applied to predict and manage maintenance issues and address quality deviations. External business areas such as sales and marketing, distribution and customer service are less likely to be automated.
Nearly all manufacturers (93%) are utilising live data and automation technology already in some capacity, most commonly to help optimise products and ensure quality consistency. The second most popular way to utilise the technology today is to facilitate a better understanding of the end customer, leading to the development of supporting services as a change to the traditional manufacturing business model.
Improvements in speed, whether developing new products to bring to market, the pace of production, reducing downtime and enabling better decision making are all being driven by automation technology. Furthermore, live data is helping manufacturing businesses to be more accountable, including providing a better understanding of the workforce to create happy and safe working environments, as well as improving traceability of materials and lowering the cost of production.
Manufacturers identify the areas of technology they predict will play a greater role in their business in the next three years:

  1. Analytics of big data including customer insight (28%).
  2. AI and machine learning (26%).
  3. Automation, robotics and cobots (25%).
  4. Internet of Things (24%).
  5. App-based, mobile reporting software for seamless management (22%).
  6. 3D printing and material science (18%).

This latest industry snapshot draws on extensive research among leading manufacturing executives. The report, Harnessing Technology and Insight: Manufacturers maintaining a competitive edge in an age of uncertainty & opportunity, is co-authored by industrial automation and control engineering expert Dr Hongwei Zhang and Professor Sameh Saad from Sheffield Hallam University and Jon Moody of SSG Insight.
Principal lecturer at Sheffield Hallam University Dr Zhang said: “Industry 4.0 is here, and the opportunity is now for manufacturers to embrace the potential of the technology currently available, as well as prepare for future advancements in order to retain a competitive edge. It’s vital that manufacturers seek to futureproof their business as far as possible, utilising live data and advanced analytics to unlock the potential for greater automation and AI within production plants.”
Chief product officer at SSG Insight Jon Moody said: “The rapid acceleration of technology is seen as the biggest challenge disrupting the manufacturing industry today, but it also presents the greatest opportunity. The adoption of technologies such as AI, robotics, automation and 3D printing, as well as innovative data management, will ensure manufacturers can reap the benefits of Industry 4.0 and become more globally competitive. It’s encouraging therefore to see manufacturers committing to investment in technology.”
 

Robots for the supermarket

Drakes Supermarkets will be installing a robotic piece picking system in its new state of the art distribution centre (DC) in South Australia. It is the first time the robotic picking system will be deployed in Australia.
Drakes Supermarkets is one of Australia’s largest independent grocery retailers. The $80 million Drakes DC, which has received planning consent from the City of Playford and is fully funded by the South Australian family-owned business, will be located on a 17-hectare site at Edinburgh North and is expected to create up to 550 jobs.
“Our new facility will be the most advanced independent distribution and logistics centre in South Australia and is a key part of our group’s vertical integration strategy within the supermarket sector,” said Glenn Sutcliffe, logistics manager at Drakes Supermarkets. “We are excited that the centre will incorporate robotics as part of a wider high-tech warehouse picking system.”
To ensure high productivity and efficiency within the DC, Drakes has chosen Dematic’s RapidPICK 1-to-1 Goods-To-Person (GTP) including the Dematic Multishuttle buffering and sequencing system and robotic piece picking.
This is the first robotic piece picking module Dematic will deploy in Australia and only the second globally. The system will handle GTP compatible grocery products in an ambient environment.
“Some of the key benefits of the new Dematic system include the security of high-value items and increased pick rates, which meet Drakes Supermarkets’ needs in an increasingly competitive grocery sector,” said Terry Jamieson, business development manager at Dematic.
“As a business committed to continued growth, our goal is to build a new DC that allows us to offer the best level of service to our South Australian shoppers, as well as set the scene for our plan to expand nationally,” said Mr Sutcliffe.
 

From MHD magazine: Belt perfection

Pharmaceutical supplier Sanacorp and KNAPP have been working together for decades. The first site where automated systems were implemented was the Sanacorp subsidiary in Ulm. Today, 15 Sanacorp sites use KNAPP’s automation technology, including conveyor systems and central belt auto pickers tailored specifically to pharmaceutical wholesale requirements.

Space-saving storage and efficient picking of a broad range of products is possible with the KNAPP-Store.

Combined with Sanacorp’s own software landscape, the KNAPP technology ensures stable operating performance without downtime and high order processing efficiency. This supports Sanacorp in the fulfilment of its quality promise: to supply customers reliably and on time.
Complete transparency with KNAPP-Store
The innovative central belt combination of KNAPP-Store and fast-moving autopicker boosts both quality and efficiency at Sanacorp.

Sanacorp now also relies on new KNAPP technology at its subsidiary in Bad Segeberg. KNAPP-Store is used for the slow-moving article range, which increases the degree of automation considerably. With KNAPP-Store, KNAPP meets current pharmaceutical industry requirements – among other things, the autopicker supports lot tracking and the recognition of security features, thereby providing transparency of all stored articles.
Automatic capturing of product master data with iScan.

Along with the KNAPP-Store, the high-performance SDA autopicker is used for processing fast-moving articles at Sanacorp, which allows high order volumes to be processed efficiently and safely. Thanks to the fusion of central belt systems, KNAPP-Store and SDA, the fastest and most expensive order lines can be processed within one system.
Article data capture with iScan
The KNAPP-Store is easy to operate via a touch screen.

During receipt in the goods-in area, articles suitable for the KNAPP-Store are scanned and thereby allocated to an order container, which is then transferred on the conveyor to its storage work station. The work stations are equipped with an intuitive touch screen monitor for straightforward operation. There, the employee places the articles on the storage conveyor – no time-consuming pre-sorting necessary. The image recognition technology iScan captures all article data automatically, including the article’s measurements. Errors are therefore eliminated up front during movement into the KNAPP-Store.
High storage performance
Optimal storage density and low storage location costs.

The two-arm gripper system of the KNAPP-Store is in charge of automatic storage with a transfer gripper placing the articles on buffer trays. The grippers take the articles from the buffer trays and store them randomly in the KNAPP-Store. The buffer function allows a single person to operate all 4 KNAPP-Stores simultaneously. This way, Sanacorp achieves very high storage performance at minimum personnel costs.

“Errors are therefore eliminated up front during movement into the KNAPP-Store.”

Monitoring the article’s features with precision is easy with the KNAPP-Store. Articles with a specific date mark, lot or serial number can be retrieved at the touch of a button and be picked in due time. That’s why the KNAPP-Store is a particularly efficient for returns that require considerable organisational effort to be fed back into the picking procedure, due to different lot numbers and date marks.

The fusion of central belt systems, KNAPP-Store and SDA allows the fastest and most expensive order lines to be processed within one system.

Efficient picking

“The two-arm gripper system of the KNAPP-Store is in charge of automatic storage with a transfer gripper placing the articles on buffer trays.”

When it comes to picking, the gripper moves to the specified position, picks up the requested articles, and transfers them to the buffer boxes on the retrieval side of the KNAPP-Store. The buffer boxes transfer the articles to an allotted order space on the central belt conveyor in the same way as the fast-moving auto-picker SDA does. At the transfer station the articles are dropped into the dispatch container. All articles of an order are consolidated from all picking areas such as the manual area or the cold-storage area and once the order is completed, the articles are transported towards the goods-out area. A lid is automatically placed on the containers before they are ready to be loaded and dispatched to the pharmacies.
For more information contact Michael Kemeny on +61 428 884 177, email Michael.Kemeny@Knapp.com or visit www.knapp.com.
 
About Sanacorp
Founded in 1924, Sanacorp is the oldest pharmacy cooperative in Germany and is one of the leading companies in pharmaceutical wholesale. Sanacorp is a company run by pharmacists for pharmacists. Its 16 regional branches across Germany ensure the comprehensive, economical and reliable delivery of medicines and health products to 8,000 pharmacies. Sanacorp also supports pharmacists with market-appropriate strategies and measures ranging from logistics to quality management and marketing activities, in order to promote the competitiveness of independent pharmacists and ensure their independence.
 

  1. Space-saving storage and efficient picking of a broad range of products is possible with the KNAPP-Store.
  2. The innovative central belt combination of KNAPP-Store and fast-moving autopicker boosts both quality and efficiency at Sanacorp.
  3. Automatic capturing of product master data with iScan.
  4. The KNAPP-Store is easy to operate via a touch screen.
  5. Optimal storage density and low storage location costs.
  6. The fusion of central belt systems, KNAPP-Store and SDA allows the fastest and most expensive order lines to be processed within one system.

 
 
 

Konica Minolta enters robotics with Mobile Industrial Robots

Martin Keetels and Thomas Visti.

Konica Minolta has formed a partnership with Mobile Industrial Robots (MiR), a manufacturer of collaborative mobile robots, to bring a greater level of automation to its clients in Australia.
MiR manufactures robots that are used by companies to transport trolleys and goods in the manufacturing sector and move pallets in the distribution industry. Built-in sensors and cameras combine with technology so the mobile robot can collaborate safely with humans. No cages or designated human or robot areas are required.
National manager of robotics and innovation at Konica Minolta Martin Keetels said: “Innovation and automation have a significant role to play in manufacturing and distribution environments in Australia. Konica Minolta is excited to bring another level of automation to its customers.
“Australian businesses are requiring greater efficiency to remain competitive in the region, and globally clients are beginning to demand robotic technology. Robotics will be a growth and productivity engine of Australia’s future economy. With more than 150 service engineers in-house and the equivalent number in the channel that can potentially service robots, Konica Minolta is in a unique position to prepare our clients for the workplace of the future.”
The partnership was made official on a recent visit by Martin Keetels to MiR’s headquarters in Odense, Denmark. MiR CEO Thomas Visti hosted Martin Keetels during a two-day visit to the innovative facility.
Martin Keetels said: “I was incredibly impressed by the calibre of MiR’s management team and the market-leading robots. It’s a great combination to find in a partner and we are excited by what the future holds.
“Konica Minolta is committed to continued investment in this space through partnerships and by developing internal resources to deliver the best outcomes for its customers. Konica Minolta’s role is to work with robotics companies to support their growth by harnessing its capabilities of distribution, services, and maintenance while our partners continue designing, manufacturing, and supplying the robots.
“Konica Minolta’s robotics capability is just beginning with MiR, with many opportunities to extend across different industries and applications in the future.”
 

©2019 All Rights Reserved. MHD Magazine is a registered trademark of Prime Creative Media.