Interfacing Storage & Handling Equipment
For Efficient Distribution Operations

By Scott Hennie

The days of pallet-in/case-out warehousing are far behind us, yet we often see distribution operations that utilize one type of storage and material handling equipment to satisfy its diverse storage & handling requirements. The most efficient operations employ a hybrid of storage & handling equipment to match the dynamics of their inventory and order profiles. As system integrators, it's our responsibility to match the storage & handling equipment in a synergistic way to ensure efficient and accurate order fulfillment operations, while maintaining flexibility to meet constantly changing customer requirements.

The storage system is the foundation of an efficient order fulfillment/distribution operation. Although the objective in many businesses is to reduce inventory, our clients still need to fill their customers' orders and ship them on time. This means that our clients must be able to find the inventory and have immediate access to it before even beginning to handle the product. Once the inventory is accessed, it needs to move efficiently and accurately through the process. This interdependency of storage equipment and handling equipment presents opportunities that we may be overlooking.

The shift from pallet in/case out warehousing to case in/piece out order fulfillment has placed a challenge on our clients that they may not understand. This challenge, combined with their customers ordering fewer items more often, has shifted the dynamics of distribution to a more specialized operation with centers of activity based around the inventory characteristics and handling requirements of the business. Our challenge comes in understanding the dynamics of our client's business and offering solutions that are better than his current practices, solutions that may not be obvious to our client.

A client's request to quote additional pallet rack or a new order picker truck is typically triggered by a change in business. It's easy to gather the specs of the existing equipment, get pricing from suppliers, and submit a quote based on price and delivery. But what triggered the initial request? Why does the client need more storage or additional order picking capacity? Are the changes in his business consistent with the application of the equipment for which he is asking? Is there a solution that will provide better storage capacity or product throughput?

These questions are the basics in providing value to the client. By asking these questions, we are either confirming our client's request or gathering data to develop a solution that will provide him with a better ROI on his investment.

State the Obvious
There are specific applications for each type of storage & handling equipment. Ask the client if he is using the equipment for these applications. If so, he has probably targeted the right solution. If not, what would be a better solution for the application? Too often, a client will choose a piece of equipment because that is what he is using today. Sales staff, with the assistance of engineering staff, can offer an audit of the operation to determine if the client is using the “Best Practices” that fit his business.

When a client requests equipment quotes, stating the obvious can help confirm the application. For example, a request for an order picker truck would trigger the following responses:

• You will be hand stacking and hand picking off pallets;
• The orders you are filling are primarily cases shipped on pallets;
• You have primary pick locations that are above 60 inches.

At the very least, these statements will cause the client to think about the application. If he is unsure or appears hesitant in his response, you will want to further explore the application and the possible solutions to your client's challenges.

Solutions = Opportunities
There are some fundamental synergies between storage & handling equipment that can be explored for further opportunities. A request and confirmed application of one type of equipment may be an opportunity to provide additional equipment. The following interfaces should never be overlooked and always kept in mind when providing equipment proposals:

• Pallet rack and lift trucks,
• Pallet rack and pallet trucks,
• Pallet rack and order picker trucks,
• Pallet rack and VNA trucks,
• Flow rack and conveyors,
• Carousels and conveyors,
• Shelving and catwalks.

If the client is looking to add pallet rack because of an increase in storage space requirement, this typically indicates an increase in business volume. How is the new rack going to be stocked and picked from? Is there adequate capacity with existing equipment to support the increase in inventory? Can a change in layout from a standard aisle system to a very narrow aisle system help the client increase business further? Is the proper type of handling equipment being used to access the rack? Is pallet rack the best solution for the new inventory volumes? It doesn't take long to confirm the equipment application, and asking questions about the application may provide answers to a better solution.

Offer Alternatives
Sometimes approaching a client's request with a different solution can cause an awkward situation. Giving the client what he asked for and offering one or more proposals that may be a better solution to his challenge can erase the awkward environment and give the contact the opportunity to present alternative proposals to his supervisor. Giving additional proposals requires more probing and data collection, but also shows a commitment to the client's best interests.

This approach is highly acceptable when the solutions provided have a favorable ROI and can be implemented with little disruption to the client's business. The alternate proposal should be determined based on business processes, information systems and throughput requirements of the operation.

The proposal should also be developed with an eye toward future enhancements. If the client doesn't currently have Warehouse Management Software, provide a proposal that can be overlaid with WMS in the future. Employing effective Warehouse Management Software can further enhance the storage & handling system. Good WMS will support directed put-away, multiple storage and pick locations, replenishment, sortation and tools such as pick-to-light, radio frequency terminals and bar code scanners.

The key to a successful storage & handling system is to build the foundation based on the metrics of the business, using sound material handling fundamentals. Once this is done, overlaying a good information system will make further refinements in efficiency and accuracy. If the operation has more than one SKU and ships orders by more than one method, there is a high probability that more than one type of storage equipment and more than one type of handling equipment should be used.

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The MHEDA Journal • Fourth Quarter 2001 • Volume 30, No. 4 • Contents are Copyright © Data Key Communications, Inc.
All rights reserved. • Nothing may be reproduced in whole or part without written permission of the publisher.