March 12, 2017
strategic insight | Manufacturing Warehousing

That sounds like a job for ... an AGV!

That sounds like a job for ... an AGV!

At its new dietary supplement plant, Amway needed a way to move goods in and out of cleanrooms while limiting human touches. The answer? Automated guided vehicles.

By David Maloney

As one of the world's largest direct-sales consumer businesses, Amway knows that the quality of its products is paramount to its success. That's why in an age when many companies outsource production, Amway chooses to manufacture a significant amount of its own health and beauty products, even growing some of the plants that will be used as ingredients on its own organic farms.

That can be a challenge. The manufacture of supplements and cosmetics is governed by a host of federal laws and regulations. Amway must follow the Food and Drug Administration's (FDA) current Good Manufacturing Practices (cGMP) regulations, which specify how ingredients for these products are handled, stored, and used in manufacturing. Among many other things, the cGMP regulations require that production be performed in sanitary manufacturing environments.

All that had to be factored into the planning when Amway began work on a project to convert a former warehouse building into a new manufacturing plant for its Nutrilite soft gel dietary supplements. That building, known as the Spaulding facility, is located in Ada, Mich., about three miles from company headquarters, where many of Amway's goods are manufactured (the company offers some 450 different products in all). The new manufacturing operation, which opened in 2014, has allowed the company to increase production of the soft gels. On top of that, the facility's proximity to the company's other manufacturing sites has created opportunities for distribution economies of scale.

Though Spaulding had been a distribution center in its previous life, the Amway team started with a clean slate in designing the new manufacturing operation. Among other considerations, it would have to find a way to accommodate multiple activities with very different operating requirements under the same roof. Production, for example, would have to be performed in a sanitary manufacturing environment, while many of the manufacturing support functions, like receiving, storage, and shipping, could not possibly maintain the same levels of sanitation. That meant that areas would have to be set aside for these activities apart from the manufacturing cells.

One of the most challenging parts of the design was figuring out how to move products easily from these functional areas into the clean environment s without slowing down production or contaminating the processing areas. Because contamination is often transmitted through people, limiting human touches was an important part of the solution.

"We wanted to prevent having people moving back and forth between the warehouse and the manufacturing area because each time they would enter manufacturing, they'd be required to gown-up," says Dave DeVries, principal engineer.

To minimize human involvement, Amway invested in a fleet of five automated guided vehicles (AGVs) from material handling and logistics systems provider Dematic. The AGVs handle most of the intraplant material moves, taking products in and out of storage and ferrying them to manufacturing areas. Although there are some limits to where they may go in the facility—for instance, the AGVs do not venture into any areas where raw materials are processed or into rooms with open product containers—they're still able to handle much of the intraplant transport work.

Dematic also implemented a warehouse execution system (WES) to manage the flow of goods as well as an integrated equipment management system (EMS) to control the AGVs' movement. Working with Dematic is convenient for Amway, as Dematic's North American operations are based in nearby Grand Rapids. In fact, the two companies have worked together on many projects in the past.


The quality control process that guides every aspect of the work at Spaulding starts in receiving. As ingredients for the supplements—like gelatin, glycerin, and fish oils—arrive at the facility's 10 truck docks, workers load the drums, boxes, and sacks onto plastic pallets supplied by Gorilla Pallets. Plastic pallets were chosen both for reasons of hygiene and because they have the consistent dimensions required for use with AGVs.

Two forklifts (supplied by UniCarriers) gather the pallet loads from the docks for transport to a receiving rack system that holds 52 pallets—about the number contained in one incoming truckload. The rack serves as a transfer point between the dock and the warehouse, with all forklift traffic restricted to the dock side while the AGVs operate on the other side. The receiving rack is one pallet position deep and four levels high, and is accessible from both sides.

The forklift operator first locates an open rack position. He then scans the pallet ID and a rack location bar code to assign the pallet to a particular slot. The scans automatically notify the WES of the products' temporary location.

The forklift operator then places the load into the rack position. Mechanical guides built into the racks assure that the pallets are placed precisely into the slots. That makes it easier for the AGVs to retrieve the loads from the opposite side of the racking.

The WES coordinates with the EMS to control the AGVs. It uses a "look for work" algorithm, whereby the software matches an AGV with a task based on the vehicle's location, status, and availability. When an item is needed, the WES assigns the selected AGV to retrieve the pallet from the receiving rack. Each AGV's forks are able to reach up to 18 feet high, so the units can easily access any of the pallet positions within the four-level racks.

The laser-guided AGVs navigate using a rotating sensor attached to the top of each vehicle. "The vehicles look for reflectors mounted at locations within the building," explains DeVries. "The AGVs follow designated fixed paths, though we have the ability to change some paths."

Two other laser sensors (supplied by sensor manufacturer Sick) also check for obstacles and will stop the AGV if they detect a person or object in its path. They even "look" around corners as they approach a turn to make certain the route is clear. DeVries reports that the safety features have worked flawlessly, noting that all workers in the facility have also been trained to be aware of AGVs working nearby.

After a pallet load has been retrieved from the receiving racks, the WES assigns it to one of the building's internal warehouses for storage. Like other parts of the building, the warehouses have specific classification levels according to what is stored inside and the specific activities they support.

The warehouses are further divided according to the attributes of the ingredients they house and thus, vary according to temperature, humidity, or other storage-related considerations. Some oils, for example, require a temperature-controlled environment, so these are stored in a separate area where the proper environment can be maintained. In accordance with storage requirements, care is also taken to segregate allergens from other materials and products.

The AGV carries the pallet to the assigned warehouse and deposits the load into the proper location in the storage racks, which, like the receiving racks, are four levels high. The amount of time a given product spends in storage varies by ingredient. To keep items fresh, the facility manages inventory by expiration date, sending items with the earliest expiration dates to manufacturing first.

For recordkeeping purposes, the EMS that operates the AGVs also records and tracks the inventory moves, passing the location data along to the WES that manages the warehouse and tracks all activities in real time.


Workers in the manufacturing areas control the delivery of ingredients to the production areas. When an ingredient is needed, a worker uses a computer to access the operator interface within the EMS and call for the material. The management software then dispatches an AGV to the appropriate warehouse to retrieve the ingredient.

In keeping with the FDA cGMP regulations, the facility is designed with vestibules that provide a clean buffer zone between the warehouses and the various manufacturing areas. As an AGV approaches a vestibule, it signals (via an RF antenna) an automatic door to roll up to give the vehicle access to the vestibule (the automatic doors were supplied by Rytec). The first door closes and a second door opens to allow the AGV to exit to dedicated drop zones adjacent to the manufacturing cells, where the AGV deposits the load.

There are, however, some manufacturing areas where the guidelines prohibit AGVs from entering. At these locations, the AGV simply drops its load in the vestibule and departs via the same door through which it entered. An operator working in the manufacturing area then opens the second door to retrieve the load with a pallet jack.

Once inside the manufacturing area, a worker removes the ingredients from the pallet for use in production. If more than one pallet of a given ingredient is needed, the worker uses a wireless push button to signal the EMS that he or she is ready for delivery of the next pallet.

When all of the ingredients have been consumed, the operator takes the empty plastic pallet and places it onto a stack. When a full stack is accumulated, the operator signals the EMS to send an AGV to gather and transport the empties to an automated pallet washer. If unused ingredients remain on a pallet, an AGV is summoned to return it to its warehouse.

The AGVs also handle pallet moves for work-in-process. After manufacturing and inspection, palletized boxes of bulk soft gels are moved to a packaging staging warehouse, which is a small storage area that is temperature- and humidity-controlled. This area contains four levels of racking for temporary storage of the bulk soft gels. The AGVs later collect the gels for packaging internally or for shipment to another Nutrilite facility for final packaging.

When a truck arrives for pickup, AGVs are again summoned to retrieve the loads from the finished-goods warehouse. After the loads are secured for transport (using Lantech stretch wrappers), the AGVs deliver them to floor staging lanes, where manual forklifts take over the loading of pallets onto the truck.


As for how it has all worked out, since moving to the Dematic AGVs, Amway has accomplished its goals of maintaining a clear separation between the warehouse and production. Plus, there's no more waiting around for forklift drivers to deliver goods, as workers can simply call for the AGVs to deliver products on demand.

Dematic continues to provide ongoing support for the AGVs. "We had a great working relationship with Dematic from the design phase through commissioning, and they continue to do our quarterly preventive maintenance and the training of our technicians who maintain our systems daily," says DeVries.

Eliminating forklift traffic and congestion in production areas has also resulted in a safe manufacturing environment. It further allows Amway to allocate its work force to production instead of intraplant transport. And best of all, Amway has gained the "supplemental" advantages of consistency and accuracy in its operations.

Editor's note: To learn more about Amway's manufacturing strategy, see "Manufacturing from the ground up" in the Q4 2016 issue of DC Velocity's sister publication, CSCMP's Supply Chain Quarterly.

About the Author

David Maloney
Editorial Director
David Maloney has been a journalist for more than 35 years and is currently the editorial director for DC Velocity and Supply Chain Quarterly magazines. In this role, he is responsible for the editorial content of both brands of Agile Business Media. Dave joined DC Velocity in April of 2004. Prior to that, he was a senior editor for Modern Materials Handling magazine. Dave also has extensive experience as a broadcast journalist. Before writing for supply chain publications, he was a journalist, television producer and director in Pittsburgh. Dave combines a background of reporting on logistics with his video production experience to bring new opportunities to DC Velocity readers, including web videos highlighting top distribution and logistics facilities, webcasts and other cross-media projects. He continues to live and work in the Pittsburgh area.

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