John Johnson joined the DC Velocity team in March 2004. A veteran business journalist, John has over a dozen years of experience covering the supply chain field, including time as chief editor of Warehousing Management. In addition, he has covered the venture capital community and previously was a sports reporter covering professional and collegiate sports in the Boston area. John served as senior editor and chief editor of DC Velocity until April 2008.
When their bubble burst, the dot-coms took a lot of industries down with them. Along with the manufacturers of pool tables, beanbag furniture and cappuccino machines were victims of another sort: manufacturers of the sortation systems used in picking the individual items for all those Internet orders.
Manufacturers of sortation equipment—shoe sorters, tilt-tray and cross-belt sorters, pop-up-wheel and pusher type sorters—had all watched sales swell during the early years of the dot-com boom. High-speed sortation equipment seemed an ideal fit for e-tailing, which tends to be heavy on single-pick orders. And in those heady early days when the dot-coms didn't know what their limits would be, sortation systems offered the design flexibility to ship 50,000 items a day or a million units a day.
Everybody knows how that story ended. And though sortation equipment remains hugely popular in Europe, domestic sales have dropped. "Like almost all material handling equipment makers, we've seen a decline in market size since the fall of the dot-coms and the downturn of the overall economy," says Steve McElweenie, executive vice president of sales and marketing for the Crisplant division of FKI Logistex, which manufactures sorting systems.
But surprisingly, the outlook for sortation equipment sales remains relatively bright. Even with the dot-com meltdown and the feeble economy, demand for high-speed sorters has held its own, bolstered by DC managers who hope that sortation systems' fabled ability to increase productivity, reduce costs and improve customer satisfaction will help them rev up their operations.
Full tilt
Though high-speed sorters aren't for everyone, their appeal to a high-volume operation is obvious. The equipment, which is used most commonly to sort individual items or cases by order in a pick-to-belt operation, offers flexibility, the ability to handle high volumes, and most of all, speed. Rates vary somewhat depending on the type of sorter. According to Christopher Paulsen, CEO of Pittston, Pa.-based material handling specialist WEPCO, shoe sorters can typically handle up to 9,000 items per hour, while cross-belt sorters process up to 11,000 items per hour.
All these things make sort ation equipment attractive to companies selling everything from books to foot wear to CDs to pharmaceuticals. But it's probably made its biggest inroads in the apparel industry: At TJ Maxx's one-million-square-foot distribution center in Pennsylvania, for example, two tilt-tray sorters run over 3,500 feet apiece and sort clothing items for delivery to over 600 stores at mind-boggling rates.
Fashion apparel manufacturer Tommy Hilfiger uses a unique sortation system built into the conveyor line at its wholesale consolidation center in New Jersey, which has cut the time it takes to turn delivery trucks by 40 percent or more. Tommy Hilfiger's DCs pick and pack customer orders (sometimes in advance of the customers' requested shipping dates), then transfer them to the company's consolidation center, where they accumulate to become full truckload quantities. On the day trucks are scheduled to pick up a consolidated truckload shipment, the pallets are placed in a multi-level pallet flow rack pick module. When the truck arrives, cartons are put on to a conveyor, inducted into the sortation system and sorted by bill of lading to the appropriate door. The sorter allows multiple trucks to be loaded simultaneously, typically in less than 90 minutes per truck.
Going for volume
Many times, the decision to invest in sortation equipment signals that a company's order volume has finally hit critical mass. At children's apparel manufacturer VF Playwear, for example, volume can reach over 100,000 units a day. "At over 100,000 units a day … when they looked at pick-tolight tolight or other options, the sheer labor it would take to process that unit volume was overpowering," says McElweenie. "Sortation provided a pretty good return on investment for them."
Scholastic Inc., the world's largest publisher and distributor of children's books, processes an avera ge of 50,000 to 60,000 orders a day at its distribution center in Jefferson City, Mo., but during a recent peak period, it actually moved more than 112,000 orders. The DC—which occupies just under one million square feet—couldn't move such high volumes without the sortation system now in place.
In Scholastic's highly automated operation, which features approximately 5.5 miles of conveyor line, high-speed merging and sortation take place at key points in the orderflow process. Wide-merge tables consisting of live roller and power-faced plow equipment from Hytrol merge up to 100 cartons a minute before they move to the quality control and automated weight check lines.
Another high-throughput merge system prepares the cartons for transport to taping lanes for sealing. From the taping area, the completed orders move toward the shipping area for the final high-speed merge and sortation.
Cartons enter this area on live rollers and connect with a three-lane servo-belt gapping system. Each lane has three segments. Photo eyes control the speed of the belts in each segment, creating gaps between the cartons. This creates a "zipper" effect as the cartons merge onto a tube-and-chain combiner.
The combiner aligns the cartons and nudges them onto a belt conveyor that leads to the Hytrol ProSort, an advanced sortation system that can handle more than 150 cartons a minute. Product is transported on flight tubes, where at predetermined locations, divert shoes move diagonally across the conveyor to push the product onto a take away line.
Start spreading the news
As sortation systems evolve,distribution centers are finding new uses for them. McElweenie notes, for example, that many customers are adapting their systems to handle a wider variety of products. Others are finding ways to perform multiple sorts on their sorters, running not only outbound order processing but also handling returned items on a second shift in an effort to achieve a higher return on their investment.
These applications haven't escaped the vendors' notice. While they wait for the economy to perk up, they're working hard behind the scenes to get the word out about sortation. Educating—or re-educating—the industry may sound like an ambitious endeavor. But it beats sitting around waiting for a dot-comeback … or shopping for a good deal on a used cappuccino maker.
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.