The warehouse of the future is getting closer

Warehousing pressures are driving substantial investment in augmented reality, voice technology, and people tracking. Spending on AR in warehousing alone will reach over US$23 billion by 2025.
Demand for warehousing facilities has been steadily increasing thanks to the strength of international trade and the continual growth of e-commerce. With customer expectations for rapid delivery rising, warehouses are struggling to process the increased volumes of goods passing through facilities in time. The problem is compounded by labour shortages and staffing challenges. The need to adopt technology to alleviate these issues is driving significant investment in augmented reality (AR), voice-directed picking, and real-time location systems (RTLS) for workforce analytics.
By 2025, global spending on AR in warehousing will reach over US$23 billion, US$3.3 billion will be spent on voice solutions, and RTLS will grow to 500,000 implementations for people-tracking across all verticals, according to ABI Research, a market-foresight advisory firm providing strategic guidance on the most compelling transformative technologies.
“Fulfilling higher order volumes is difficult when warehouses are struggling to hire and maintain staff, and automation is cost-prohibitive for many distributors,” said senior analyst at ABI Research Nick Finill. “Warehouses are therefore increasingly using digital tools that can empower the human worker, deliver efficiency gains, and also reduce the time it takes to induct new or temporary staff.”
Augmented reality is finally starting to gain mass appeal in industrial sectors, thanks to maturing technologies and demonstrable ROI from early adopters. Voice-directed technology represents a considerably older technology but is also undergoing a technological revolution thanks to deep learning-based voice recognition that vastly improves ease-of-use and reliability. Voice is being leveraged to assist the warehouse workforce by providing operational instructions in a clear and hands-free way.
The drive for digitally-enabled workforce productivity in the warehouse is incorporating the human worker into the Internet of Things at a rapid pace. The increased use of RTLS technologies, such as Bluetooth Low Energy, Wi-Fi tracking and RFID, are allowing warehouse operators to analyse productivity of the workforce as well as the movement of physical assets. Workers can be monitored in a way that respects privacy while generating valuable operational data that can drive workforce efficiency over time.
Companies such as RealWare,, Panasonic, Lucas Systems and TopSystem are providing warehouses with a wide range of technology products that can provide incremental advantages. Driving productivity in this way can be an attractive alternative to more expensive automation projects, which is a concurrent trend in warehousing with the potential to transform operations in the longer term.
“The combination of multiple devices and technology can have a positive compound effect on workforce productivity,” concluded Mr Finill. “However, companies must be smart about how they integrate multiple technologies within the same stack to ensure they remain complementary and ROI is maximised.”
These findings are from ABI Research’s ‘Devices and Solutions for Workforce Productivity in Warehouse Logistics’ technology analysis report. This report is part of the company’s Intelligent Supply Chain service, which includes research, data, and analyst insights. Based on extensive primary interviews, Technology Analysis reports present in-depth analysis on key market trends and factors for a specific technology.

What's in the press this week?

Spotlight on: distribution centre design
Mal Walker
Many logisticians are keen to understand the basics behind effective distribution centre design. This is a complex area as there are scores of variables that have to be considered. So to help you along, without getting into tedious details, here are some proven rules of thumb that you can apply if you are designing a new warehouse or making changes to an existing facility.
Critical design template options
I-shaped design
Warehouses that receive at one end and dispatch from the opposite end are flow-through or ‘I’ shape layouts. These are commonly used for high-volume operations, or where complete separation of receiving and dispatch operations is required. While I designs are widely used, these designs required greater hardstand areas than the alternative ‘L’ or ‘U’ shape designs.

U-shaped design
Receiving and dispatch operations that are adjacent, on the same side of a warehouse are known as ‘U’ shape designs. The majority of distribution centres are designed as U-shaped. This is because they offer the best ratio of building-to-land use and minimise the amount of hardstand required for receiving and dispatch vehicle movements.

L-shaped design
‘L’ shape designed warehouses typically receive on one side and dispatch on an adjacent side at 90 degrees from the receiving side. Many cross-docking operations employ an L-shaped design, along with organisations that receive goods in large trailers but dispatch in smaller vehicles.
In some cases, modern distributions may include two or all three of I, U and L designs. Particularly where a number of methods to market are required, e.g. direct to store deliveries, business to distributor, business to consumer, and business to route. They may also be used where facilities need multiple chambers to store temperature sensitive or dangerous goods. In all cases the key design drivers are spatial planning, vehicle types accessing the site, flow, and volume.

Racking orientation
For conventional warehouses the most efficient method of operation occurs when racking runs in the same direction as incoming materials. This allows forklift operators free access from receiving and to dispatch docks. Placing the racking at 90 degrees to incoming materials is not recommend as funnelling and bottlenecks can occur, as forklifts are forced to use central aisles to put-away and retrieve stock.
What level of mechanisation should be applied?
The simple answer to this is only what is necessary to optimise capital investment against ongoing operational expenditure. Spending a little more capital may actually reduce ongoing operational cost, but spending far too much may send you broke. Conversely, spending too little on capital equipment may cause high operating costs in the ensuing years of operation. So what is the right mix of mechanisation? While there are a number of factors that drive mechanisation decisions, there are two common drivers:

  • Number of stock keeping units (SKU) or products handled.
  • Volume of picks per day, week or month.

You may ask why picking is a point of focus. This because order picking can absorb up to 80% or resources within distribution centres, so every effort to reduce time and resources to fulfil orders will mean savings to your business. Conceptually, the matrix shows how SKU and picking volume form the basis for justifying mechanisation.

Dock and loading bay design
Providing the right docks and loading bays in a distribution centre should be straightforward, but sadly it’s not, as many warehouse operators can testify. Consider the variety of vehicles that may visit your warehouse, and the numbers of each. E.g. pantechnicons, rigid vehicles, temperature controlled end-loading trailers and B-Doubles, ground delivery side- or end-loaded vehicles, utilities, side-loaded trailers and B-Doubles and rigids, courier vans, motor bikes and push bikes. Ignoring or overlooking any one or more of these groups, can cause deficiency in dock, loading bay and hard stand design.
As a general rule, if a dock or loading bay is 75% utilised, you should provide an additional one.
How tall should my building be?
Over the decades building roofs have progressively been getting higher. In Australia’s manufacturing past, pre- and post-WWII industrial facilities were 5.5 to 6m high. Many were of saw tooth design with lots of columns throughout. Fortunately, these have largely been demolished and replaced with portal frame buildings as high as 11 or 12m at the springing line. The portal frames allow much longer spans across the warehouse and minimise internal rows of column to only one or two. This provides designers with freedom to install many varieties of equipment to a height of 10m to 11m.
However, where high-bay warehouses (for automatic retrieval systems) are considered, there are limited developers willing to take them on. This is because history reveals that it’s hard to lease specialised high buildings after the first user has exited, compared to lower height facilities. This trend is changing though, due to increased urbanisation, so more high-bay warehouse are tipped to be constructed in coming years. (See my previous article ‘Spotlight on ASRS’, MHD July/August 2017 – available at
What are the rules of thumb for planning and design?
Warehouse aspect ratio
Never design your building to be circular, triangular, or square! Avoid trapezoids and parallelograms if you can. Why? Despite whatever architectural licence is used to make warehouses look great, the best shape is the humble rectangle. Over the years, I’ve found it to be the most efficient shape for distribution centre design. Ideally at a ratio of length = 1.7 x width.
Land aspect ratio
Same as warehousing.
Usable land for buildings and hardstand
Rules differ across states and councils on the allowable building size as a proportion of land size. In many instances 50% applies. That is 50% of the land space can be planned for buildings, however, some city councils may allow a greater proportion.
An additional consideration is the recent spatial rules applied by some councils to alleviate floods and to promote greater green space. In effect, they dictate a greater percentage of permeable land, which may in turn restrict the amount of non-porous hardstand that can be laid.
In both of the above cases, its best to check local council rules during the design phase.
Amount of room planned for receiving and dispatch
Many completed warehouses can suffer from an over-concentration of materials handling and storage equipment. This can have a drastic impact on the operation of a facility. As a guide, for most warehouses, from 20 to 25% of the available warehouse floor space should be allocated to receiving and dispatching operations. The balance of 75% is usable for storage equipment and picking systems.

“The building will be set up once, but operations will continue year after year, so wise planners give manoeuvrability the priority.”

Truck turning /reversing space
For semi-trailers’ movement, in and out of facility and reversing into docks, allow 37 to 40m. For B-Doubles, allow 50 to 55m. However, where B-Doubles drive through and do not reverse in, 37 to 40m is sufficient.
Vehicle flow around warehouse
It’s best, in Australia, for vehicles to flow in a clockwise direction, to allow for driver side reversing. While this is not always achievable, its preferable over anticlockwise operation, as driver visibility is better.
Sqm per pallet in a conventional warehouse (quick rule of thumb)
Allow for 1.2 sqm per pallet for conventional selective racking systems. Push up to 1.4 for narrow aisle or double deep systems.
More pallets or more forklift room to manoeuvre?
What is best? More pallet racking with narrower aisles, or less pallet racking and wider aisles for fork lifts to manoeuvre in?
In my view the priority should always be ‘operation’ over ‘capacity’. The building will be set up once, but operations will continue year after year, so wise planners give manoeuvrability the priority.
Hopefully the rules of thumb will help you be effective in your design quest, but please remember that there are many other aspects that are relevant. Perhaps you have learned from your own experience and have a few tips of your own. Drop me a line if you do, as I am always interested in hearing what others have faced during the design process.
Mal Walker is the manager, consulting, at the Logistics Bureau. For more information contact Mal on 0412 271 503 or email

SAF-Holland joins MEGATRANS2018

SAF-Holland is the latest commercial road transport equipment specialist to join supply chain trade event MEGATRANS2018.
The company is a leading original equipment manufacturer (OEM) for the global commercial vehicle industry, which has provided a range of solutions for fleet operators to boost freight productivity, equipment efficiency and safer operations through the implementation of innovative SAF-Holland components and technology.
The OEM is known for providing the commercial road transport industry with axle and suspensions systems, landing gear, braking systems, truck and bus suspensions and couplings.
SAF-Holland is a welcome addition to the multimodal logistics and supply chain event, which will make its debut in Melbourne next May.
SAF-Holland will take the opportunity at the trade event to meet directly and engage with OEMs, end-users and third-party logistics companies that are becoming increasingly sophisticated in their knowledge of components technology and their requirements to reduce tare weight, improve productivity and increase safety.

ALC welcomes “common sense” report from Productivity Commission

The Australian Logistics Council (ALC) has said the release of the Productivity Commission report Shifting the Dial: 5 year productivity review provides a welcome injection of common sense into the national conversation about transport and urban planning policies.
The report noted that urban congestion is already costing Australia’s economy $19 billion each year, forecast to rise to over $31 billion by 2031 if remedial action is not taken.
The Association described the Commission’s observation that “infrastructure decisions could be enhanced by taking out the ‘Utopia’ factor in their preparation” as “sound advice for policy-makers at the federal, state and local government levels.”
“The message in this report is very clear,” said ALC Managing Director, Michael Kilgariff. “Unless we take definitive and practical action to address issues such as urban congestion and the efficiency of our transport networks, the nation’s economy and the wellbeing of its citizens will suffer.
“Freight Doesn’t Vote, ALC’s submission to the Discussion Paper on National Freight and Supply Chain Priorities – contains a comprehensive range of practical ideas drawn from the freight logistics industry that can help to address the challenges which the Productivity Commission has identified.”
“It is particularly pleasing to see the Commission making recommendations that align with many of ALC’s long-established policy positions,” Kilgariff added. “Including better alignment between freight movement and planning, that infrastructure proposals be subjected to a public cost-benefit analysis, that road funds be established from hypothecated road-related revenues, and that state and territory governments consider adopting a road user charging pilot program.
“As ALC has consistently said, policies which restrict or ban the movement of freight vehicles in particular areas, and especially in CBDs, are neither realistic nor desirable. It is heartening to see the Productivity Commission has drawn a similar conclusion, and calls upon governments to address the ad-hoc and anticompetitive planning policies that have given rise to the congestion problems that now bedevil our cities and their surrounds.”

Clorox outsources supply chain to DHL

Family supplies brand Clorox has chosen to outsource distribution of its products around Australia to DHL Supply Chain.
According to a statement, the partnership reflects Clorox’s focus on customer service, innovation and consistency.
Clorox’s decided to outsource its warehousing operation to achieve a more standardised and customer-centric approach, allowing the company to meet customer demands while removing the stress of distribution.
“We were looking for a partner who understands its customers’ business and responds quickly,” said Mike Fraser, Regional Logistics Manager, Clorox. “DHL Supply Chain has enabled us to maintain high levels of speed, reliability and quality control in our logistics processes, allowing us to stay competitive in the industry and help transform our end-to-end logistics operations.
“Our goal is that when a customer reaches for a product at the supermarket, it’s there. With DHL Supply Chain, we are confident that all of our products will be delivered on time and in full. We continue to look to them as a logistics partner of choice for future growth.”
DHL Supply Chain implemented a range of warehouse and supply chain improvements to Clorox’s operations across Australia, including warehousing, value-added services and inventory reduction, helping Clorox improve productivity by developing a more flexible operating model.
“The implementation of the 3PL (third-party logistics) service provided to Clorox has been achieved in just over three months, a process that would traditionally take six,” said Saul Resnick, CEO, DHL Supply Chain Australia and New Zealand.
“For fast moving consumer goods (FMCG) businesses, the logistics process is critical as consumer purchasing decisions are largely based on availability. We ensure all stock is delivered to stores when promised and with as little manual intervention as possible,” he concluded.

WiseTech Global establishes partnership with C.T. Freight

Logistics technology company WiseTech Global has entered into a partnership initiative with C.T. Freight, an international freight forwarder with extensive coverage throughout Australia. The partnership is designed to help accelerate the creation and expansion of technological innovations in the logistics industry, including automation through digitisation, natural language processing and machine learning.
Richard White, CEO, WiseTech Global, said, “The logistics industry is under intense pressure as eCommerce pushes upward on shipment numbers and applies downward pressure on consignment size, price, and margins. eCommerce is disrupting the old world order and will force logistics providers to higher levels of automation whilst border agencies continue to raise the bar on timely, accurate, and compliant trade data.
“WiseTech Global is focused on improving productivity, quality, speed, visibility, and manageability in the logistics industry. Our development partner initiatives represent a tightly targeted commitment to further automate logistics execution processing, moving CargoWise One to ever higher levels of throughput.
“With C.T. Freight as a development partner on high volume airfreight and eCommerce automation, we will further develop our cutting-edge productivity and automations to address these issues across the logistics industry and its many segments.”
C.T. Freight has bonded warehouses at each major Australian gateway, and through the initiative the company will gain access to developments and deployments of WiseTech Global software.
“One of the most compelling features of CargoWise One, and of WiseTech Global’s philosophy, is productivity,” said Clive W. Thomas, CEO, C.T. Freight. “Eliminating rework, reducing risk and improving margins by automating entire processes frees up specialist resources who can then concentrate on adding value back into the international supply chain. In our industry, the gains achieved by minimising errors and automating processes can have a tremendous impact across all modes and geographies.”

VTA celebrates project progress and industry resilience

Victorian Transport Association (VTA) CEO Peter Anderson has highlighted the major productivity challenges facing Australian freight and logistics operator in opening remarks to the VTA’s annual State Conference at Lorne.
Anderson said in a big-picture sense, it is a challenging time for all freight operators.
“Freight movements are generally down thanks to a stagnant economy, and operator margins that are already stretched thin are being further squeezed by higher input and variable costs. We are also operating in an increasing regulatory environment and having to adapt our businesses to satisfy and comply with additional regulatory oversight.”
Anderson explained operators are also facing higher road and infrastructure user charges, which eat into profits and erode margins.
“These factors highlight the need for operators to extract greater productivity from their systems, their equipment, their people, their customers and their suppliers to remain viable and successful.”
Anderon noted that there are a lot of exciting things happening in the industry across technology and innovation, safety and training and human resources, and infrastructure.
“We now have a North East Link Authority established and are actively putting together the business case and corridor study for the connection, which will finally link the M80 to EastLink or the Eastern Freeway,” he said.
“This has long been the VTA’s priority road infrastructure project and we are playing an active role in the consultation and planning for the connection, which the current Victorian Government has committed to take to the next election.
Anderson also reflected on the considerable progress made on the West Gate Tunnel project. The Victorian Government last week released additional plans and environmental modelling for the project, which will provide better access to the Port of Melbourne for heavy vehicles.
“While we support the project, we are unimpressed with plans to permanently curfew trucks from existing roads and force them to use a toll road. We’re working closely with the treasurer and the roads minister on incentives for trucks to use the new freeway, such as toll rebates and reduced tolls at nights, as well as exempting modern and efficient vehicles from the proposed curfews.”
Anderson explained that the Association is encouraging infrastructure planning and investments in the Port of Melbourne to ensure it remains Australia’s biggest.
“There are many issues working against freight volumes increasing within the Port of Melbourne, so it’s important we plan now for short- and long-term infrastructure needs at the Port to keep it competitive,” he said.
“This includes improving rail access via Port Rail Shuttles, proper road and rail infrastructure planning for freight movements in and out of the new Webb Dock Terminal, and upgrading infrastructure to accommodate high productivity freight vehicles.”

VTA releases full speaker list for 2017 conference

With just over a week until the Victorian Transport Association’s (VTA) annual State Conference in Lorne, the peak freight industry representative body has revealed the full list of speakers that will address delegates over the two-day event, June 4–6.
New keynote speakers include Simon Thomas, Director – Programme Delivery, Australian Rail Track Corporation (ARTC); Jonathan Dexter, Australia National Sales Manager, Viva Energy; Max Kruse, Chief Operating Officer, DP World Australia, Ian Matthews, Regional Operations Manager, WorkSafe Victoria; and CMV-Volvo Product Manager Thiago Leal.
These addresses will be supplemented by panel presentations and discussions from a mix of equipment manufacturers and suppliers, insurance and finance providers, human resources, and superannuation and legal experts.
“Productivity impediments remain the number-one barrier to transport operators being more successful, which is why we’ve built the program around a group of expert presenters and topics that can help delegates improve their operation’s KPIs across the board,” said Peter Anderson, CEO, VTA.
“The program reveals an interesting mix of keynote addresses and presentations from politicians, regulators and industry leaders, supported by several panellists that will share insights and learnings on key productivity drivers of technology, safety, people, customers and equipment during a number of interactive discussions.

Former ATA Chair joins freight and supply chain panel

Former Australian Trucking Association (ATA) Chair David Simon will sit on expert panel supporting the Australian Government’s National Freight and Supply Chain Inquiry.
The Hon. Darren Chester, Minister for Infrastructure and Transport, announced the appointment on 17 May, in a speech about transforming Australia’s freight and rail network.
Current ATA Chair Geoff Crouch said the appointment shows that the Australian Government recognises the importance of trucking operators to moving the national freight task.
“Trucking operators are critical to the national supply chain, and increasing the productivity of trucking makes the supply chain more competitive, reducing costs for consumers, industry and exporters,” said Crouch.
“The ATA and its member associations are working on the issues and proposals that need to be made to the inquiry to boost productivity and safety for our industry.
David Simon is the Executive Chairman of Simon National Carriers and was Chair of the ATA from 2010 to 2014. He also served as a member of the National Heavy Vehicle Regulator (NHVR) project implementation board and the Heavy Vehicle Charging and Investment reform board.

Flinders University ‘Kookaburra’ discovery may boost logistics productivity

Flinders University researchers believe they have cracked a long-running quest for an optimal solution to the classic algorithm question in computer science known as the Travelling Salesman Problem (TSP).
The TSP focuses on finding the most efficient and cheapest way for a travelling salesman to visit all of his cities and return to a starting point.
An optimal answer could lead to lucrative productivity gains in a range of industries and complex tasks, from logistics and transport to more cost-efficient manufacturing, gene sequencing and even drone mission planning.
The solution was achieved by the Flinders Mathematical Sciences Laboratory Hamiltonian Cycle Project over the past three years and has already broken more than 20 records, solving open TSP problems listed on the international register maintained by the University of Waterloo in Canada.
It is shaping up as a powerful new tool to develop better software systems for a range of industries, said Associate Professor Vladimir Ejov, director of the Flinders Mathematical Sciences Laboratory.
“In a resource-restrained world, optimal solutions are increasingly necessary in ever-more-complex processes,” Ejov said. “We hope this TSP solver could become a world leader in highly competitive market of solving difficult logistics and many other industrial problems by the virtue of its highest quality outcome.”
The history of the TSP dates back to Sir William Hamilton’s early investigations of the dodecahedral graph in 1857 and his Hamiltonian Cycle Problem has puzzled math minds ever since. It is summarised as: given a graph containing N vertices, determine whether it contains a simple cycle of length N.
Ahead of seeking out possible industrial and research partners, PhD students Alex Newcombe and Pouya Baniasadi are putting the software to work in a range of applications while lecturer Dr Michael Haythorpe is looking to upgrade computer cluster facilities Colossus.

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