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Boosting productivity with operations under one roof

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Munro Footwear Group has committed to a new $50 million distribution centre in Melbourne’s west on the back of online growth. The footwear wholesaler and retailer – together with supply chain consultancy TMX – talk about the efficiencies to be gained from consolidating all operations under one roof. 

Marcus Bartlett, Chief Operating Officer at Munro Footwear Group (MFG) says the company’s major investment in supply chain operations supports its multi-year growth plan to expand the business. Critically, moving two separate operations to one distribution centre helps iron out existing inefficiencies, for example working with two warehouse management systems. MFG will consolidate its currently separate operations – a self-run facility in Thornbury and a third-party-run operation in Truganina – in a new $50 million facility strategically located as part of the $600 million MidWest Logistics Hub in Truganina.

“Having all of the inventory accessed from one location will be critical,” Marcus says. “Internally transferring products between buildings is inefficient – and having two differently-run facilities adds further operational complexities. This move will help increase productivity and efficiency, with our customers directly benefiting from reduced lead times and improved service.”

MFG has a long history in the bricks and mortar retail and wholesale world, so the new distribution centre will cater to all aspects of the business. 

“We are experiencing increased online growth – which is a significant factor to be sure,” he says. “But before embarking on this investment we had to be certain the size and operating model was going to be fit for purpose for the long-term across all different parts of our business.”

WORKING WITH TMX TO BUILD THE RIGHT FIT

MFG partnered with supply chain and property consultancy TMX to review its supply chain network, design new operations with an automated solution, and run the property procurement process. TMX secured a 10-year lease for MFG with Charter Hall – and will now project-manage the development of the new facility.

As is customary for the property and supply chain consultancy, the full gamut of solutions and experience was brought to bear by TMX’s team in its objective of establishing the Truganina facility as a vehicle to support MFG’s accelerated growth. 

“Having the subject matter experts on our side along the journey gave us full confidence in the exciting opportunity,” Marcus says. “Having the right information – receiving the support to decide on the technology, the developer, the location – will allow us to transition from a primarily manual operation to using more future-proof solutions.”

Marcus Bartlett, Chief Operating Officer at Munro Footwear Group.

AMRs LEADING TO HIGHER THROUGHPUT

Sam Dellios, Director at TMX, says the Truganina facility will have one of the largest AMR goods-to-person deployments in Australia, capitalising on MFG’s recent growth from online and in-store sales. 

“One of the biggest benefits of AMRs is the flexibility they provide,” Sam says. “Historically, goods-to-person and automated picking systems have been largely fixed units that effectively form part of the building as long as the tenants are there. An AMR layout such as this one allows businesses to adjust to different throughputs and offers maximum flexibility.”

The scalability of the solution particularly interested MFG, whose sales ramp up at specific times of the year depending on online events and seasonal shifts. 

The new AMRs will increase picking speed and accuracy, creating greater productivity and efficiency in operations while reducing lead times to customers. 

“The dynamic grid is intuitive and designed to help MFG reach a significantly higher level of picking accuracy and productivity while providing a safe working environment,” Sam adds. 

The facility as a whole will assist in optimising inventory levels, integration with transport carriers, and enhancing customer experience across the group’s 260-plus store network and –importantly – its 11 e-commerce sites, which have been experiencing significant growth. 

Sam Dellios, Director at TMX.

SUSTAINABILITY 

The Green Building Council of Australia’s Green star rating system is Australia’s largest holistic sustainability rating system for buildings and fit-outs. The facility is being designed to meet a five-star rating – the Australian category reserved for excellence in meeting sustainability standards.

Sam notes that a variety of sustainable building initiatives contribute to a highly-rated facility, but that – among them – creating a comfortable, inviting work environment is a key pillar of the rating system.

“It’s about including a lot of green space instead of a fully built-up environment,” he says. “There’s a big push towards creating a happier, healthier work environment centred around wellbeing and user-comfort.”

A 600-kilowatt solar system will power all operations and around 20 electric vehicle charging points will also support the current push towards electric powered vehicles. “The solar capability will power the entire facility, and then some,” Sam adds.

LOCATION LOCATION LOCATION

Marcus Bartlett says the facility’s advantageous location will allow for faster access to transport and carriers. MFG will join existing tenant customers – including Coles, Uniqlo, Toll, Ingham’s, Encore Tissue, and Bridgestone – at MidWest Logistics Hub, providing access to distribution channels, including the Port of Melbourne. While examining various parts of Melbourne, TMX’s location analysis identified the west as the best nucleus for MFG’s operations. 

“The transport savings – being close to the airport, ports and CBD – provide a significant financial advantage, as well as contributing to a more sustainable operation,” Marcus says. “We’re hoping to unlock benefits for our customers by more closely integrating with domestic carriers to provide greater fulfilment options.” 

For more information on TMX, click here.

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