Pallet Storage and Picking Optimization Lecture Transcript

Animated publication


(00:00): Yesterday we started walking through best principles inside the warehouse. We started with receiving and put away, and our next stop is in the storage area. We're going to look at practices and systems to support pallet storage. What is the range of technology that's out there, and then how do you make a good decision about that technology? The first thing we're going to do is divide these systems into two major categories. One is called static racking. The other is called dynamic racking for obvious reasons. In static racking, nothing's moving in the rack. Nothing in the rack moves in dynamic racking, there is mobility built into the racking itself to move pallets forwards and backwards in static racking. The first option, actually there's no rack there with it. It's called floor storage. Second is what's called a stacking frame. It's like a pallet with a rack built into it. Third is single deep rack, then double deep, then drive in slash drive through rack. This is like the rack song. It's not a rap song, it's a rack song. (01:13): In dynamic, there's pallet flow rack, so we put a pallet in at the back and it flows through to the front. There's pushback, so we put a pallet in at the front and we push the others back, and then there's mobile rack where the rack itself literally moves up and down a set of rails. The first general question I want to ask you before we get into these, because we're going to look at each one of them, how would you know if you'd done a good job choosing the racking for storing pallets and large loads? How would you know if you'd done a good job? What's the criteria? Yes, cube utilization would be one. What else? The labor associated with storing and retrieving. What else did you address any first in first out requirement? In fact, what you're describing, we like to use this term optimization. (02:08): We coined a phrase called right chain. The basic idea in right chain is supply chain optimization, so how do you minimize the total supply chain cost and satisfy the customer service policy? Whatever supply chain configuration does that is the right chain, right store is a reference to a warehouse in aggregate that's optimized. It's the warehouse configuration that minimizes the total warehousing costs and means all of the requirements of the customer service policy, the inventory strategy, et cetera. That's where the term Wright store comes from. Wright modes means do I have the right mix of storage modes, which in this case is going to satisfy this thing called unit load storage optimization. So who remembers what the idea of optimization is? Anybody remember? Yes sir. Resource get the most out of the resources that you have. That's a good way to say that a little more formally. There's an objective function, something you're trying to achieve with this. Typically in this area, it would be minimize the storage costs. Right now we're looking at the pallet storage area as if it is a warehouse unto itself. So that would include what labor, occupancy and equipment.

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


(03:46): Now, if that's all I got up here, that's pretty easy to do, right? And say, I'm not going to store anything that way. I don't need any labor, I don't need any space and I don't need any equipment. What stops me from doing that? There's a set of constraints. One is the storage capacity. I've got to provide enough storage capacity to accommodate whatever the inventory strategy says I need to accommodate. Where'd that inventory requirement come from? By the way, the service policy related to the inventory. So that storage capacity has got to be greater than or equal to the storage requirement, and we said that comes from the inventory strategy. So suppose I don't have an inventory strategy. How do I solve that? (04:45): No way. I don't know. It's a big guessing game. Number two, fi o first in first out. If that's a requirement, it may not even be a requirement, so what I really would rather say rather than FIFO would be shelf life. Sometimes people will put a very strict first in first out requirement, and really that's not what you need. You just need to make sure that the product gets out of the warehouse before the shelf life expires. Three is the building configuration. You can't put racking in higher than the clear eye of the building. You can't stack pallets higher than the clear height of the building. (05:44): Four, labor availability. If you can't get access to the labor, you may be forced into a highly automated solution. That's what happens in parts of Japan and parts of Europe. When you put that in combination with the space availability, so in words, that's what unit load storage optimization looks like. How would you know if you've done a good job if you satisfy these constraints and minimize the cost in doing so? Now we're going to show you some models that help you deal with all of that, but the first thing I want us to walk through are the storage systems themselves and then we'll talk about how do you get the right mix of Vogues in place? What Jason's talking about is the trade-off between accessibility and storage density. If you've got one floor storage lane and you put 12 different SKUs in them, you can pack the lane, but where's the product that you're really going to need? (06:50): It's going to be at the back underneath everything else, so that's that trade-off between accessibility and storage density. How would that play itself out in here? By the way, that's why you need labor and space in that equation right there. We had one client. The economic justification was very easy for an automated storage retrieval system, I want to say 60 feet tall. The zoning said you can't build a building higher than 35 feet, so what do you do? They dug it out and I'm not recommending that. I'm just saying that regulations play a big role in here. Let's take a look at these different systems and we'll start it with floor storage. First of all, what is the advantage of floor storage?

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


(07:40): There's no rack. What happened to the equipment cost over here? Zero. How about operating flexibility? It's good, right? What's the problem? Storage density is a big problem because of a factor called honeycombing. Why is it called honeycombing? It's because if you look at this picture, once you start operating it, it looks like a honeycomb and here's the reason. Let's look at that aisle right there. How many SKUs should I put in an aisle one because if I put more than one SKU in that aisle, what happens? Yeah, you need the one in the back. I dunno what that's about, but maybe it's to teach us not to do that. (08:36): We had one client, they actually had a budget item for the warehouse called shuffling, and I thought, what are they talking about? Like shuffle off to buffalo or is it some new dance step that they do? I thought maybe it was an aerobics instructor. They had come in, I said, what is this? He said, oh, that's when we have to take some of the SKUs out of a lane to go get the one we need. I thought, wow, that's amazing, right? That's amazing. That's amazing, so we can't put anything else there. Can we put another SKU on top? Same phenomenon. Those loft lives that are due to one SKU per lane, one SKU per stack are called honeycomb losses. (09:22): What are some of the other limitations in the warehouse to the use of the cube? Why can't we not store all the way to the ceiling? One is you might crush the product. This is potato chip, so that could be a problem, right? Two is the equipment. Three is what kind of load can the floor tank? Four are the regulations, five is the weather. How could the weather play a role in how high you can stack material? Yes. The humidity. We had one client and they set up a warehouse in the Philippines and they had to redo all of their stack height requirements because the humidity level, it's the firmness of the corrugated. Sometimes it's the firmness of the product itself. Now, this is not so much a weather thing, but a Coca-Cola, you can stack Coca-Cola classic three pallets high and their orange drink. You can only stack too high. Why? (10:36): This is a weird one, the carbonation very good. The carbonation in Coke Classic creates a very rigid surface and it says cushy in the orange drink. Low stability is another one. We do a project with a dog food company and the tops of the surface of the load is not even, so you can only stack those two high where if you've got nice even pallets, you can stack those three or four. How do you really figure this out? How do you really figure this out? Trial and error. The parking lot. That's a fun day to be at the warehouse. Have you ever seen the national Oreo stacking contest? If you're really bored, you can't find anything else on tv. Every year they have a national Oreo stacking contest and literally kids compete on how high they can stack the Oreos. It's like that. Unfortunately, most people think if it's floor storage, this thing must be really easy to operate. Actually, it's not that easy to operate. There's some rules we're going to need to keep the honeycombing losses at a minimum. Let me give you an example.

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


(11:53): These numbers right here represent SKUs, so here's S-K-U-A-B-C, et cetera. Let's look over here at SKUN. Suppose a request comes in for SKUN and it's sitting in two lanes, lane one and lane two. Which lane should I take the product from? Which lane should I take the product from? I would suggest lane two so that you can free up that space for another product. That's one of the rules that you need to have in place to make floor storage really work for you. The second thing I want to share with you is there's another option for this product that's over here in NO and P and that is what's called re warehousing, which would be to take those small quantities and move them maybe into some racking to free up this space right here. That practice, which is not executed very often is called warehousing, but it's very powerful. The next question that comes up is how deep should the lane be? This started out pretty simple, but all of a sudden we got honey coing and re warehousing and lane depth optimization. Let's suppose a lot comes into the warehouse and the lot has 24 pallets. We can stack them three high. That's the stack height. How many stacks do we have? (13:45): That's eight stacks. Let's suppose I've got an aisle right here. There are a lot of ways I could put those eight stacks against that aisle. Let's suppose I'm really concerned about storage density and that's a wide aisle, so I think try to store the pallets this way. Here's 1, 2, 4, 5, 6, so there's my eight stacks. That's eight d. Was that a good idea? Why not using that much aisle space for that lot? The problem is when I take that stack out and that stack out and that stack out and that stack out, they're gone. Can I put anything else in that space that was vacated so that didn't work so good. That lane is too deep, so you think, let's try something else. (14:46): 1, 2, 3, 4, 5, 6, 7, 8. How about that? We took up a lot of frontage for that. SKU. The length of this path has gotten very long because I'm doing this with all the SKUs, plus if I do the same thing on the other side with just one deep and I've got this big 12 foot aisle, all of a sudden 60% of the floor space is devoted to aisles, so the answer is probably somewhere in the middle, right? I hope you'll say yes. It depends on the turnover of the product, the max stack height, the length of the load, the height of the load, the width of the load, the width of the aisle, the clearance between rows and the cost of the floor space. The optimal lane depth 1, 2, 3, et cetera is different. That's how you start to optimize the lane depths. Normally we put all of the SKUs through an analysis like this and it'll tell you very quickly what the lane depths need to be. We did the project last year for a big consumer products company helping them figure out what the mix of lane depths should be, so you can see 15, 14, 13, all the way down to one deep how many SKUs and how many lanes you needed of each one of those depths. That's what a floor storage optimization looks like. The assumption to this point is that floor storage is the right option. That may or may not be true, but if you're going to use it, that's how you start to optimize it.

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


(16:37): Yes, that's a great question. Hold on. You got all these different lane depths. What should you do because you probably can't set up a warehouse and have we got a few three deep, we got a few eight deep, we got a few four deep, we got a few. What do you do? If you saw this graph, what would be your recommendation to them in terms of configuring that warehouse? There are 25 SKUs that need six and 14 that need 70, so that's 39 SKUs right there. Probably there's not that much difference between six and seven. There might be some. Where's another pocket? (17:30): 10 and 11. Here's nine and nine. What I might do then is have some 10 deep lanes here and I'm going to have maybe some six deep lanes here and that may be all I have, but at least I've got somewhere close to the right mix. Here's the other thing to remember. Here's my aisle right here. Here's 1, 2, 3, 4, 5, 6, 7. From one side that can be four and three. It could be two and five, it could be one and six. There's flexibility in there and a good warehouse management system will help you implement a wide variety of lane depth if it's managed that way. Walter, that was a really good question. You're going to set this warehouse up and it's going to have a mix of these lane depths. Sometimes you get it right on and sometimes the lot comes off the line and you run the calculation and say this lot needs to be in five deep lengths. We don't have any five deep right now we only have four deeps and seven deeps. Based on the analysis I was showing you, the next best option would've been four deep. Let's put it in the four deep. If you just keep running the warehouse that way you can maybe double the storage density is substituting information and optimization in this case for physical space. That's what we're doing right there. (19:09): The next thing I could do is to use racking to try to improve the use of the floor space. That is called a stacking frame. What's unique about it? Instead of stacking on top of the product, they stack on top of fixtures. This isn't more expensive. I have to pay for the frame. When would you ever use stacking frame? Seasonals a good option because usually it's for temporary and it's a big buildup because the accessibility may not be that great, plus maybe you can't ship in the stacking frame, so now you have to disassemble it every time you want to ship something, so usually it's for a short term high volume storage requirement. When you don't need the stacking frames, they collapse down so they don't occupy that much space. Does anybody here use stacking frames? What are you using for Hubert (20:07): Ford line?

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


(20:10): The storage density in that case is more important than the accessibility because it's a big burst of import product. That's a good example. The other good news is when you don't need the frame for themselves, they store in a very limited space. If somebody could receive it with a stacking frame, that would be even better, but usually folks can't receive it that way. Now we're into some real racking. By far the most common type of racking is single deep rack. Why is it called single deep? It is because it is single deep against the aisle. What's the advantage of working with single deep rack? (20:52): What's the advantage as compared to any option we've looked at so far? Visibility is one. Every pallet is accessible from the aisle. We've got very good accessibility, but the storage density is not so great because what portion of the floor space is devoted to aisles? Just look at the picture. What portion of the floor space is devoted to aisles? 50 to 60%, so when would you ever use it? Got a lot of skews and not many pallets on hand for each one. The other thing is now we bought some equipment depending on the price of steel, this option can get pretty expensive. (21:44): Lemme ask you another question. Suppose you're looking at that picture, you're talking to the manager of that warehouse and they say, you know something, we're absolutely full. What would you say? That's amazing. You need to recalibrate your definition of full. Why? What portion of the locations are occupied? What portion of the locations are occupied? The number of locations? We're working at 20 locations and only two of them don't have something in them. What portion of the locations are occupied? 90% different questions. What portion of the cube is occupied? 20%. What about all the space right there? All of the space right there. All of the space right there. All of the space right there. What's wrong? (22:42): The locations are not sized properly. You want to make sure that the rack is configured to match the height of the pallets. Just that alone can help you get 15 to 25% better storage density, just making that match happen. Double deep rack is just single deep rack back to back. So here's one two deep against the aisle. What's the advantage of double deep rack over single deep rack? What portion of the floor space is devoted to aisles now? Maybe 30 to 40% instead of 50 to 60%. However, can I put more than one skew in a lane? (23:38): I could, but probably I shouldn't because if I did, let's suppose I have A here and B here and I need B. Got to take A out to get to B and then put a back in the location. So what you want is A and A, B and B, C and C, et cetera. That said, what types of products should I put in double D

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


rack products where I have two or more pallets on hand, usually two to five pallets on hand because suppose I've got a product, it only has one pallet on hand. Let's call it product D. There's only one pallet on hand. Can I use that location right there for anything useful? Not really, unless there's another D, which there's not. The other disadvantage with double deep rack over single deep rack is what equipment. That little gizmo right there is called a scissor rate, which costs a few thousand. Worse than that is the productivity of getting to this slot versus this slot. (24:48): It's another trade off of accessibility and storage density. What costs are impacted here? Labor space equipment. That's why you got to include all three of those When you do the optimization, we're just walking through the static rack options. We have floor storage, stacking frames, single deep rack, double deep rack and now drive in or drive through rack. The basic idea goes like this, here we are 1, 2, 3, 4, 5 deep against the aisle. So what's the advantage? What portion of the floor space is devoted to aisles? Very little 20% maybe so the use of the floor space and the use of the cube of the building is very good as long as you've got a lot of the same SKU and you don't need it anytime soon. This could be a great way to store the product, but I don't know a lot of folks who are in that situation. You are. Bulk cheese would be perfect for this. There you go. (25:58): Bulk chickens would be another one that would be great for this and you mentioned another key in there, what do cheese and those chickens have in common? Refrigeration which makes the space even more expensive. So what costs are impacted here? Let me get to the labor part just before we answer that question. How long would it take you to retrieve this pallet Right here on the front pretty quick. How long would it take you to retrieve that pallet? You start driving down that little lane. It's like trying to drive down peach Street Street in a Hummer. You got to be very careful in there so the productivity is not very good. Let's go through it again. What costs are impacted? Labor space equipment, same thing. Run the numbers. Flow rack. That's the beginning of our dynamic rack discussion, which is gravity, flow rack drive in rack. (27:02): You put it in from the front, you withdraw it from the front pallet flow rack, you put it in from the back and you pick it from the front. Here's an example, we put it in at the back and we pick it from the front. What is the advantage of pallet flow? Rack over drive in first in first out is one. Since you pick from one side and replenish from the other, you don't have so much congestion at the front of the system, which for high turnover items, that's a big deal. What else? It should be more productive, right? Because now we have either conveyor in here or sometimes it's done with little air pockets to slide the product down to the front. The labor's not doing that. The rack is doing that. What's the disadvantage?

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


(28:07): One is space because we got access on both sides. Second is the cost. This could cost a few hundred dollars per position because I have mobility inside the rack itself. What type of product should I put in? Pallet flow rack something where fi FO is a big deal. Also, I got to have several pallets on hand. If I've got a product and I only have one pallet on hand, what's the utilization of that lane? Terrible. Well, this is usually 3, 4, 5, up to 10 pallets on hand somewhere in there. Another option if I don't want the space on the front and the back, but I still want good use of the lanes and I don't want the operator moving inside. That rack is pushback rack here. (29:06): The operator puts a pallet in it pushes the other pallets back. If I take a pallet out, the other one's behind it come forward. That's why it's called pushback rack. What's the advantage? Every SKU has a pallet in the front position. I don't have space behind it. I've got good storage density and it's less expensive than gravity flow rack. This advantage I got picking and restocking going on at the same spot so I got that congestion. This comes from a pushback rack fender, so you got to take this with a little bit grain of salt, but you get a feel for just how much floor space you're picking up using a system like this as compared to single deep rack. Next on the dynamic side is mobile storage. Here the entire bay is moving. We're not moving product within the bay, we're moving the bay. I create an aisle where I need it. This aisle is created, so let's suppose I need product from Bay J, then I move H this way and I move I this way and now I can access aisle J. What's the advantage of working this way? (30:26): What portion of the floor space is devoted to aisles? 5%. What's the problem? Cost is one. Now you're in the four or $500 a position couldn't be accessibility. The product I always need is right here. The accessibility is not very good at all. Then when would I ever use it? Slow moving. Not many pallets on hand and the space is really expensive relative to the labor. So you'll see this in Japan and Europe much more than you will here in the states. And then there's cantilever rack that's used to store sofas, sheet metal bar stock, plywood where the load itself is going across several different positions and you can't have racking in the front otherwise you couldn't access the product. So the beams themselves are can cantilevered, cantilever off the main mast and the racking. (31:31): Now which type of racking should I use? Which one of those should I use? Very good. He said the key run the numbers. There's probably not one of those I should use. There's a mix of those. I should use a hybrid solution that probably is going to work best. It's probably a combination of single deep and pallet flow and pushback, et cetera, and I'm looking for that right mix. Let's take a quick trip through the vehicles and then we'll put all this together into a solution. So far all we've looked at are the storage systems. If you put the product in some single deep rack and you have no way of retrieving it, that doesn't do us any good, right? So a unit load storage

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


solution is a racking configuration and a vehicle configuration and these are the options and I hope you'll have picked up by now. I always try to go from the simplest least complex, least expensive, most flexible to the other end. I always there. That's our approach. If you can solve it with a counterbalanced lift truck, I'd rather do that than solve it with an automated storage retrieval machine. That's our approach for a lot of different reasons. We're going to walk through these different options. Option number one is a walkie stacker. What is unique about a walkie stacker? (32:59): You walk behind it so it's not very expensive and it will stack product. Can you unload a truck with it? Can you put product away with it? Yes. Can you retrieve product with it? Can you load a truck with it? Yes, so with the same vehicle I can do all of the interleaving steps we talked about yesterday in terms of expense and productivity and flexibility. This is a pretty good place to start. What's the limitation? The stack height only going to be two, maybe three high, but if you've got short distances and the ceiling is not very high anyway, this may be a very good S and this may be 3, 4, 5, 6, $7,000, something in that range. Next option is a counterbalanced lift truck. Question number one, can you unload a truck with it? Can you put product away with it? Retrieve product, load a truck. Yes. Okay. That's why we start with these first two so I can do all of that with one move. Never have to make a handoff. What is the relationship between handoffs and performance inverse? Now, why is a counterbalance truck called a counterbalance truck? It's got this big weight back here so that when this pallet is 15 feet up in the air without that weight back there, what would happen right there? That's what would happen. What's the disadvantage of a counterbalance truck? (34:34): The size that counterbalance takes up a lot of room. Okay, just ask Charles Barkley. He had a big counterbalance, but man, he could get some rebounds. He took up so much space that's good. In basketball in a warehouse that may not be such a good idea. The turning radius will probably going to require us to operate in an aisle between 10 and 14 feet wide depending on the product. Now there's some things we can do about that though. There are standup counterbalance trucks that might work just as well. Also, I can handle one, two loads at a time. I don't have to handle just one load at a time. (35:14): There are attachments I can put on the lift truck to get even better utilization of the vehicle. It could be for handling carpet backing or drums, anything you want to handle. Pretty much there's an attachment to allow a lift truck to handle it. The other cool innovation in lift trucks recently is fleet management where there are companies who will come in and they'll help you figure out vehicle by vehicle when it needs to be replaced and what it needs to be replaced with. Also, some of the vehicles today will run off a GPS inside the building so you can see at any point in time what vehicle is where and exactly what it's doing and be able to divert it

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


accordingly and to monitor its utilization Perpetually, you can do a lot with a lift truck. This is at Toyota loading and unloading a trailer, but what's unique about that trailer?

(36:11): It's called a goal wing. It opens like this but it's sideloaded so I get access to the whole truck all at one time. Lindy makes this, which is somewhere between a turret truck and a counterbalance truck. It's a counterbalance truck in the back and it's a turret up in the front to help reduce the aisle space requirement. The other cool thing I can do is the multi load truck and this is at a sun in Japan. How many loads is that truck carrying? Four. How many trips would that have been? Four. So the productivity is literally four times what it would've been. The disadvantage is I need a wider aisle. We put a system like this in with a company here in the states and the option against it was automated guided vehicles, but because we could handle so many pallets at the same time, there was no way to justify that level of expense given that you could work with a truck like this. (37:11): Now for the Iowa width, there are a couple of things we can do. Where was the counterbalance for a counterbalance lift truck behind it. I can also counterbalance in front with what are called outriggers almost a duck and that's called a straddle truck because those outriggers straddle the load. So what is instead of an aisle that's 10 to 14 foot wide. Now I can operate in an aisle that's maybe seven to nine feet. The problem is can I load and unload a truck with this? Probably not because of the height of the mast. I'm going to pick up something on the storage density side, but I'm going to lose something on the labor and the flexibility side. The truck is about the same cost. These things are in the 20 to $30,000 range. The other problem with the straight straddle truck is to put the product away. (38:08): I literally have to take the product, the mast of the truck and it has to come flush with the face of the racking. If I use a reach mechanism, that's this little gizmo right there that will reach into the location and do the putaway for me, but that's going to cost me a few extra thousand dollars probably is going to allow me to be a little more productive. You'll notice as I go through these slides, the aisles are getting narrower and the lift height is getting higher and higher. What's happening to the storage density? It's getting better and better. However, how am I paying for that? The cost of the vehicle? Because this side loading truck, this could be 40 or $50,000. It only needs an aisle that is five to six feet wide. (39:00): The problem is it's side loading, so I can only access one side of the aisle at a time, but now I can get five or six levels high and I've only got an aisle that's four to six feet wide storage density, big thumbs up, cost of the vehicle, big thumbs down, and then flexibility. Can I unload a truck

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


with that? Nope. When would you ever use that? The pretty unique application. The space is expensive relative to everything else, and I've got bar stock, sheet metal, plywood, that kind of thing to work with. The next thing I can do, somebody came along and invented a turret truck and it only needs an aisle that's four to six feet wide because in front of it, the forks are on a turret. The vehicle itself doesn't have to turn. The forks turn left and right, and now I'm in an aisle four to five feet wide and I'm up seven or eight levels high. So the storage density is outstanding. The problem is the cost of the vehicle because that little puppy right there could cost 60 to $80,000. Could be even more than that. That's a turret truck and they're a swing mast and swing fork turret trucks. We're getting close here. It's a good thing, right? This is an automated storage retrieval system. So what is unique here? What's different in this picture as compared to any other vehicle we've looked at? (40:41): Nobody there. It is like a robot. That could be 40, 50. I've seen them a hundred feet tall in an aisle that could be 40, 50 or 300 feet long. How wide is the aisle? Just as wide as the pallet because the way it works, this is called a shuttle table right here. It runs up and down this mast at the same time. The mast is traveling horizontally up and down the aisle. So you've got simultaneous, horizontal and vertical travel. When I get to a location, the shuttle table comes up, puts a pallet in, comes down, and comes out. What's the advantage here? So what? It's storage density. I'm up 60, 70, 80 could be a hundred feet. The aisle's only a few feet wide. Storage density is great. How about labor? (41:42): There's no labor. What's the problem? The cost of the equipment. That little aisle right there could be 500,000 to a million dollars. So it's the same thing. Equipment, occupancy and labor. It's in that trade-off. Who would use this? We've started working with Hallmark cards in Kansas City. They put one of the very first of these systems in. Now I'm not sure it is the best justification in the whole world, but they put one in Japan. There are thousands of these systems because the space is so expensive. That's the dominant factor there. You see these more in Europe. Another big problem is flexibility. Suppose you're picking profile changes. What do you do? We have a client right now, they have a system like this just north of Atlanta and the whole profile has changed from pallet in, pallet out to pallets in cases out, and the retrofit is going to be a few million dollars to make that happen. So the flexibility is not very good. When I was a PhD student over here, we had a big material handling lab and Eaton Kenway gave us one of these things. I used to have to fix these things. That's why I don't like 'em. I think they've gotten a lot better today, but at least here in the states it's hard to find the justification form, but it's increasing. It's easier today than it used to be. (43:08): There are all types of configurations for these. See if you can find out what's unique on the picture on the right. This in Chiba. What's unique in the picture? This is a tough one and I had a

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved


hard time getting the picture. There are two a SR machines in the same aisle, two machines because a big issue. You've only got this one spot right down here at the front at the bottom where you can get things in and out. So they put two machines. So now I can work both into the aisle and at two levels. (43:42): There's all kinds of ways to configure these. I'm not recommending one of these over another. I just want you to see what's out there. This is probably the most sophisticated unit load storage retrieval system I've ever seen. It's mobile rack with an A SRS. The last one I want to talk for a little bit about is what's called an automated guided vehicle system. But if the vehicle can stack, we call it an automated storage retrieval vehicle, an A SRV, the one that you're looking at costs about a hundred thousand dollars, but the costs are coming down. What's the advantage? (44:23): It can go anywhere. There's no labor. If you've got steady paths through the warehouse, the labor is, this could be a really good way of solving that issue. You got another picture is at a company called Kieran. That vehicle, there's no labor and it's handling four pallets at a time. The productivity there, you can hardly even calculate it and the vehicle probably costs $45,000. That's not much more than a traditional lift truck. Why did they give it a steering wheel in case somebody had to drive it? Plus, it's fascinating to watch it move. It looks like a ghost is driving that thing. (45:02): The next page, I wanted you to see what a solution looks like. This is one we did last year. You run this optimization we talked about right here. Remember this, minimize labor occupancy and equipment costs. Meet these constraints, and at least for this particular company, the answer was we put 79 SKUs in floor storage, 33 and single deep four high seven and single deep six high. We needed two sit down counterbalance and pretty much that took care of it. That's a storage solution. Now that's a pretty simple one right there, but I wanted to give you a feel for what one looks like.

Pallet Storage and Picking Optimization | © RightChain™ Incorporated | All Rights Reserved

Made with FlippingBook Digital Publishing Software