Making The Switch From Manual Distribution To High-Speed DC, Liberty Hardware Shows How To Do It Right
By Jim McMahon
The switch from a manual distribution operation to a high-speed, automated distribution center is nothing to be taken lightly. Companies need to be methodical and very careful about putting into place such a change. While this change can be drastic in the least, it is capable of creating a huge positive impact on a company's product delivery turnaround to its customers. Not to mention the tremendous jolt in reduced labor hours – more automation means less hands required to move products. Add to this more standardized handling of the product resulting in reduced damage, and an increase in ergonomics decreasing worker injuries, and it looks like a match made in DC heaven. Ultimately, lowered cost of DC operation, with increased output, is the payoff.
Making the switch, however, can be a nightmare if it means the DC's process flow is going to be slowed or even severely interrupted. Nobody wants 5,000 cases an hour getting backed up for very long, or stopped altogether, while the makeover from manual to automation is working out its kinks. But the changeover can be done without a hitch. One company that has recently made the switch is Liberty Hardware. Operating a manual distribution center in the city of Ontario in Southern California, Liberty realized the need to automate its DC after company acquisitions expanded its product lines, and its desire to speed delivery times to its Southern California customers.
Liberty wanted to automate, but not diminish its manual throughput volume in the interim, a key problem faced by companies making the switch. Its solution was simple, build a new, completely automated DC literally right next to the existing manual operation, and switch operations to the new DC when finished. Providing thorough planning was done beforehand and the project management was executed methodically, the switch had a high probability of succeeding. To co-design the project, Liberty's internal logistics team brought in Tom Zosel Associates (TZA) - a logistics consulting firm, and Dematic Corp. Dematic also managed the project, and supplied the majority of the material handling equipment used in the facility. Working as a tight group, Liberty, TZA and Dematic pulled off a very successful, and relatively quick turnaround of a 550,000 square-foot manual DC into a streamlined, state-of-the-art, high-speed, automated distribution center, without a hitch in process flow.
Liberty
Founded in 1942, Liberty Hardware Manufacturing Corporation is one of the industry's leading manufacturers of high-quality decorative and functional hardware solutions, home organizational products, bath safety and decorative accessories for the home. Its products are sold through retail outlets, wholesalers and original equipment manufacturer (OEM) distribution channels.
Liberty's current product lines include bath hardware, bath safety, decorative cabinets, functional cabinets, builder's hardware, hook rails and wall plates. In addition to the Liberty brand, the company offers its products under the Brainerd, Franklin Brass, Solutions By Liberty, and Safety First brand names. It allows customers to select from products made of solid brass, zinc, ceramic, acrylic, glass, steel and wood. Products are designed to meet the latest consumer demands in terms of styling, finishes and functionality.
The company's headquarters is located in Winston-Salem, NC with other office and distribution facilities located in Ontario, CA, Randolph, NJ, the United Kingdom and China. The company is part of the Masco Corporation, one of the world's leading manufacturers of home improvement and building products, as well as a leading provider of services that include the installation of insulation and other building products.
Planning a Multi-Brand DC
"The concept for building a DC in Ontario, California was born out of an analysis we conducted to serve our West Coast market more efficiently," says Tom Turner, Vice President, Global Logistics, for Liberty. "We deal with many retailers here that sell home building products. We also looked at it from a multi-divisional standpoint, to consolidate the distribution of other Masco company products, in addition to liberty."
Liberty's volume in the DC needed to represent about 60 percent of the product movement. The remaining 40 percent was to be split among three other Masco companies. Including BrassCraft Manufacturing, whose products would consume another 30 percent of the product handling in the DC. The remaining 10 percent of product movement would come from Delta Faucet Company, and Alsons Corporation, two other divisions of Masco.
BrassCraft Manufacturing Company is North America's leading provider of water supply products for builders and remodelers. The company's products include the Speedway, Speedi Plumb and Speedi Plumb PLUS hot and cold water connectors. Flexible gas and water heater connectors are also produced, as are gas ball valves and fittings, brass fittings and water-saving showers.
Delta Faucet Company is the largest U.S. manufacturer of residential and commercial faucets. The company manufactures the Delta, Brizo and Peerless faucet brands, and holds the number-one faucet market share position in the United States.
Alsons Corporation offers hundreds of distinct choices for designers, builders and remodelers of hand-held showers and shower heads in a wide variety of styles, functions and finishes. Resources Conservation, Inc. (RCI) is part of Masco's Alsons division. RCI is a leading manufacturer of water and energy-saving shower heads, as well as bathroom and kitchen fixtures for the do-it-yourself retail market.
To maintain product integrity with the stores, the DC was planned to not co-mingle the divisional segments in delivery. The flexibility was built into the DC, however, to route through it one order of multiple products and brands. Although all products are inventoried in the same locations and use the same conveyors and sorter, they are waved separately and shipped separately by brand. This system is really retail driven, that is the way the orders flow in from the retailers, by brand, so the DC ships them out by brand. But, within the DC, much of the handling is not brand discriminate.
The new Ontario, California DC also needed to supply both mom-and-pop and big-box retailers – about 80 percent of its distribution, and building contractors through wholesalers which represents the remaining 20 percent.
The Automation
"Automation requirements for every DC are different, no two are the same," says Steve Jones, with Dematic. "The trick is putting in just the right level of automation to handle not only the current needs of the DC, but also projected growth demands, without over-specifying. The concept of ‘efficient automation' applies here. Over-capitalization can diminish cost efficiencies in the long-run if the DC is under-utilized."
"Dematic was brought in to help Liberty and TZA develop a new design for handling the volumes of product types from Liberty's different company divisions," continues Jones. "We determined the layout for the product flow, defining the type of system and equipment we needed to handle their projected volumes over a five-year horizon. Dematic was also responsible for managing the installation, the contractors and the construction licensing for the site. This included providing engineering services, the sortation equipment and conveyors, including scanning systems that were integrated with the conveyors, and the warehouse control system (WCS) for running the conveyors."
The DC receives import containers, as well as domestic receipts from vendors in trailer loads. Everything coming in gets palletized and put away. The DC has roughly 35,000 pallet locations in a seven-pallet high-rise, with 32-foot clear ceiling.
The pickers are picking from case flow locations, with eight roller-lane picking, as well as full-pallet locations. 85 percent of the picking is full-case picks to the belt. 15 percent is off-line picking, which is not routed through the conveyor system.
From the picking areas, a belt conveyor threads through three-levels of pick modules, then proceeds to a merge subsystem. Label printers at each module produce shipping labels for the pickers, and bar code labels are manually applied to cartons during the picking process. A five-sided vision scanning system on the conveyors checks the shipping label on the case to provide automatic quality control, and then the system updates the order status in inventory.
The DC has the ability to wave by customer, by ship date, by cancel date, and by ship-to, although typically they wave by ship date.
A Dematic RS Series sliding shoe sorter with photo-eye accumulation and controlling software allows high-speed, accurate package handling up to 150 cases per minute. Interleaving extruded aluminum slats provide a wide, flat carrying surface that prevents jams. It allows the sorting of a wide range of product sizes and types - with quiet and positive sortation and ultra-high throughput.
Coming off of the sorter, automatic pressure accumulation conveyors (APC) are used to temporarily stop, hold, and release material. They allow product accumulation along a line without pressure buildup, and provide quiet, zero-pressure action with electronic sensing and pneumatic components, eliminating the noise of standard mechanical rollers. The DC is also equipped with 10,000 linear feet of conveyor composed of two-inch roller centers, optimum for handling smaller cartons.
Each order is sorted out by ship-to location. Once at the end of the line, they palletize and shrink wrap the orders, and ship.
Dematic's SortDirector is being used for the warehouse control system (WCS) which provides state-of-the-art graphic system monitoring for the entire conveying operation. It gives operators real-time control of product movement, and real-time reporting.
The Payoff
"Since the DC opened in September of 2006, we have cut our order turnaround time to one-third of what it was with the manual operation," continues Turner. "Now, we are operating from receipt of order out to the customer in less than 72 hours. We are handling an average of 350,000 cases a month, and have had peak months of as many as 440,000 cases. From a service perspective, we have been able to gain significant labor efficiencies. We have cut our labor hours by 40 percent."
"What was critical is how quickly we were able to come up with a design and turn the entire project around," says Turner. "From operating in a manual environment, then merging several divisions together, and building in a high-speed automated system, while maintaining our level of service. Total turnaround time was within 18 months."
"At the end of the day what really made this project a success was the team that we had working on the project," Turner explains. "Both internally and externally, the integration of the team made the project run very smoothly, and proved to be a very successful switch for Liberty to a much more efficient distribution center."
About Dematic Corp.
Based on a rich tradition of over 70 years of worldwide industry expertise in creating logistics results and more than 10,000 systems installed worldwide, Dematic Corp is the world's leading supplier of logistics automation solutions, systems and service.
Beginning with Rapistan's rich history from gravity conveyors to automated, modular conveyor and sortation solutions, Dematic now offers a full range of engineered and highly configurable system solutions that optimize warehousing and distribution operations. With Dematic, companies can reduce distribution costs, maximize overall logistics efficiencies, and increase the operating speed of their supply chain.
Dematic is a global company with operations in 22 countries around the world. Its North American headquarters is located in Grand Rapids, Michigan. For genuine Rapistan conveyor system parts, or more Dematic information, visit www.dematic.us.
For more information on Dematic's DC solutions,visit: www.dematic.us.
To reach Liberty Hardware, division of Masco Corporation, visit: www.libertyhardware.com.
Tom Zosel Associates, LTD. can be reached at www.tzaconsulting.com.
SOURCE: Zebra Communications