Engineering a warehouse design for multiple scenarios is crucial before businesses lock themselves into an operational lease. MHD speaks with Fuzzy LogX about purpose fitting distribution centres to avoid wasted space, reduce operational inefficiencies and future-proof your business.
Businesses that identify weak links in their DCs are often faced with a make-or-break choice: reconfigure an existing warehouse space – or start from scratch in a new facility.
How to make this crucial call?
Jeffrey Triantafilo, Director of Systems & DC Design at Fuzzy LogX, says that for their team of “Warehouse Wizards” data is key. He says that Fuzzy LogX’s proprietary scenario modelling tools provide a crystal ball allowing businesses a glimpse into the future – accounting for different business’s potential growth and operational nuances.
“We don’t just design warehouses, we engineer them,” Jeffrey says. “From the start, we work hard on making sure the data behind our decisions is as accurate as possible. What’s the sensitivity of the data? Where does it lead us? We really go to the nth degree for our clients.”
Jeffrey emphasizes that Fuzzy LogX always sits “client side” and flies the DC Design flag in every project they’re involved in. This is particularly important when space equals money. There must be a game-plan in place to avoid underutilisation of space – for instance, if a business doesn’t grow enough to need the additional space they’re paying for – or underestimating warehouse needs, in which case a business will have to move again before the lease expires.
“You have to think like the client, so their pocket doesn’t hurt as much for every square metre they are not fully utilising.”
A MULTIFACETED APPROACH
While there is a justifiable enthusiasm for automation in warehousing – and Fuzzy LogX is an ambassador for effective automation – Jeffrey says that relying on automation alone is too narrow minded.
“What you have to consider with these “emerging technologies” is that the investment involves not just the up-front cost of the solution – but the cost of accommodating it, too,” he says. “The price tag of the solution itself might seem cheap – but if it’s only using the lowest two-and-a-half or three metres leaving another seven to ten metres of unused cube, you have to consider the extra square metres you’ll be paying for during the length of the lease.”
Consultants that are not fully independent can be tied to certain solutions and oversell big-ticket items to their clients, Jeffrey says. “Some consultants tend to look at an autonomous process in isolation, not understanding all the moving parts and turning a blind eye to expansive designs. As independent consultants, we think about engineering the warehouse holistically in terms of process, people, and systems while not losing sight of the impact of technology in terms of time, space, and practicality.”
RIGHTSIZING WAREHOUSES
Bas Schilders, Fuzzy LogX’s Principal Consultant, outlines that returns, picking and packing are the most common warehouse processes that must be reconfigured as the e-commerce era unfolds. The shift in consumer behaviour, he notes, has raised the stakes for DCs – as they are now responsible for the fulfilment that was formerly done through stores.
“Warehouses used to be these dusty old sheds that no one wanted to know, and the store would service customers,” he says. “Now, all of a sudden, the whole organisation is making a promise that the warehouse is fulfilling – there’s no buffer. The warehouse is being transformed into an experience fulfilment centre.”
When warehouses pick for direct fulfilment rather than for store replenishments, “the difference is chalk and cheese,” says Jeffrey. “When you pick for a store it’s easier to get volume out the door because you’re picking full cartons. You’re doing a lot of products and lots of units. However, when you pick for an online consumer, you’re only going to be picking two to three units, possibly, one to two different products. You must completely re-think your fulfilment process. You have to change pick case types from full cartons to individual items and you have to pick multiple orders at a time.” And that is without even considering the myriad of solutions if your DC must cater for both store replenishments and online customer fulfilment.
How orders are picked naturally has ramifications for right-sizing a warehouse but a lot of businesses forget the packing and sorting part of the process and its impact on the size of a warehouse, according to Bas.
Bas adds that the packing process also involves logical and physical steps and may take up considerable warehouse space. “Whereas before you were simply sorting cartons to each store, each customer order now not only has to physically be put into a despatch shipper – but you also have to logically confirm that the order was picked to the right quantity, with no damage, at dedicated packing stations which didn’t exist prior to the ecommerce era,” Bas says. “It has to be for the correct customer, with the right label and void fill. And once completed each despatch shipper will need to be sorted to the right destination, increasing the need for staging space.”
In engineering a warehouse that is future-proof and right-sized, Bas says, Fuzzy LogX considers the equipment, the personnel, the processes, and the likely future direction and mode of scaling – striking the right balance depending on relative despatch styles and volumes – and the attendant human-capital, spatial, and equipment requirements.
Fuzzy LogX’s latest high-profile warehouse-engineering successes is about to go live for Countdown in New Zealand, with whom Fuzzy LogX has been working for the last two years. The Fuzzy LogX team has supported the design of a 38,000 sqm distribution centre in Palmerston North that will deliver 450,000 cartons of food a week to supermarkets from Gisborne to Wellington.
Jeffrey and Bas believe that Fuzzy LogX’s drive for maximum operational efficiency – with best practice in safety and process – help to foster these strong partnerships and increase the success rate for their clients– and will continue to do so in future.
For more information on Fuzzy LogX, click here.