Today’s Class:How layer picking can mitigate the effects of SKU proliferation

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Speakers

Julia ArlinghausProfessor

Head of the Chair for Production Systems and Automation at the Otto-von-Guericke University

Magdeburg in personal union with the head of the Fraunhofer Institute for Factory Operation and

Automation IFF.

4/13/2021

Klaus Kristensen

Sales ManagerLayer Picker SolutionsKörber Supply Chain Automation

The Right Storage Method for Your Warehouse

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Why are we here? What are we trying to accomplish?

Class Schedule:

• April 6: The Right Storage Method for Your Warehouse• April 13: How layer picking can mitigate the effects of SKU proliferation• April 20: Increasing productivity of person-to-goods operations• April 27: Improving a goods-to-person Order Fulfilment System

Master Class Series - On-Demand

• Addressing Labor Challenges• Cold Storage Trends• Warehouse Technology Excellence• Workforce Efficiencies & Safety

Supply Chain Master Class:

• SAP Supply Chain Excellence• Disruption Mitigation• Sustainability

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All phones lines are muted

Recording of today's class and slides will be email you within 48 hours

Questions:

• Ask questions during today's class in the GoToWebnair Questions window• Questions will be addressed at the end of today's class or we will follow up with questions via email after class

Poll Question:In your current operation, how do you pick orders for full layers:

1. Manual picking with individual case picking2. Semi-automatic (fork lift + operator)3. Using automation solutions4. Not applicable to my current position5. None of the above

Housekeeping

4/13/2021

Determine the product assortment and price segment on retail stores

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High Customer Expectations

ability to choose between cheap, medium and expensive brands

grocery stores with different

price segments

ability to choose among many

different brands

GMO-free products

Organicproducts

exclusive food(delicatessen, halal,

kosher)

products for immediate

consumption

food for intolerances

ASSORTMENT

fair tradeproducts

many different brands

in-house brands

PRICE SEGMENTS

regional products

IFH Köln 2018

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One-Stop-ShoppingCustomers prefer a bundled offer of goods

84,5%

42,2%

75,5%

42%

77,6%

40,4%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

I like to seek out grocery stores where I can do all myshopping.

If a store doesn't offer a wide enough selection, I don't shopthere.

2018 2015 2011

IFH Köln 2018

Powerful stores require powerful warehouses

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SKU proliferation is inevitable with a growing business

• High demand for logistics space close to urban areas -heterogeneous use of logistics real estates and retrofitting of individual storage modules and real estates

• Brownfield uses and revitalization of existing buildings• Optimization of warehouse layout and technological

exploitation of vertical storage spaces• Dynamically changing customer preferences and need of

product variety• Shift of customer expectations towards delivery speed and

product pallet• Competitiveness of the market• Explosion of small brands and niche products• Seasonal products - short-term increase of SKUs• Less space in stores and higher efficiency for replenishment

Sorbis / Shutterstock.com

Operational productivity problems caused by SKU proliferation • Excellent warehouse operations prerequisite to excellent store

operations - pallet mix individually optimized to stores` need -rainbow pallets / sandwich pallets

• Highest accuracy of order fulfilment • Smaller ordering quantities and shorter order cycle times• Increased labor and operating costs• Tracing and track-keeping of perishable goods• Additional storage spaces, replenishment and picking areasAutomated layer picking can contribute to • Better space utilization: less or non picking areas needed• More efficient and accurate order fulfilment even for small orders

(rainbow pallets / sandwich pallets)• in the long term, capacities can be optimized and costs reduced

Increasing complexity challenges warehouse operations and business productivityPain Points of SKU Proliferation Emerge in the Warehouses

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SKU Stock Keeping Unit

Distribution Center Distribution Center Distribution Center

Past - Decentralized Distribution Center(s) Small volume – 100.000 cases/week and 100 SKUs as an example

97%

97.000

2%

2.000

1%

1.000

What has changed?

Picking complexity:

Low

Today - Centralized Distribution Center - High volume 1.000.000 cases/week and 1.500 SKUs as an example

75%

750.000

20%

200.000

5%

50.000

Super size Distribution Center

What has changed?

Picking complexity:

High

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Layer Picker Solution – Combining pallet storage with Layer Picking

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Gains with Automated Layer Picking

SKU #

98%

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Gains with Automated Layer Picking

Higher efficiencies

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Gains with Automated Layer Picking

Scalable 1.000 10.000 layers/day

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Gains with Automated Layer Picking

Higher picking accuracy

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Gains with Automated Layer Picking

Full

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Gains with Automated Layer Picking

Vacant

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Gains with Automated Layer Picking

Fully automated warehouse

Automated Layer Pick

Return

Investment

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13 April 2021 20

• Have a requirement for picking more than 1.000 layers per day• The complexity of the layer picking is high due to more than 100 SKU and/or

a have a flat ABC curve• Have made a strategy to increase the throughput and capacity of the current

operation using automation

What to provide for the next step?

• Production data, order line • Product master data• Building drawings• Product pictures, examples• Brief description of your operation and what you want to gain from the

automation• Input that helps determine the business case

When to consider Layer Picker Solution?

13 April 2021 21

Layer Picker Solution examples

13 April 2021 22

Layer Picker Solution examples

Questions & Discussion

April 20

Increasing productivity of person-to-goods operations – key considerations for your project

Better understand AMRs solutions. How canAMRs take over transport activities inside thewarehouse while voice technologies can keepworker’s hands and eyes free to improve pickingefficiencies.

In this week’s session, we will explore how voiceand robotics technologies can augment person-to-goods case-picking workflows and helpimprove job satisfaction.

Contributor:Anton Du Preez | Group Sales DirectorKörber Supply Chain

Next Supply Chain Master Class

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