Twenty years ago, Frito-Lay relied on workers to hand stack cases of chips, nuts, and cookies in its trucks. Now, it has more colorful loading options, including the "T. Rex" and robots.
Susan Lacefield has been working for supply chain publications since 1999. Before joining DC VELOCITY, she was an associate editor for Supply Chain Management Review and wrote for Logistics Management magazine. She holds a master's degree in English.
For many companies, truck loading and unloading is one of the last frontiers of automation.
Consider the case of Frito-Lay. By the mid-90s, the snack food giant had long since automated operations inside its distribution centers. But when it came to loading trucks, the company still relied on manual processes, with workers spending their days inside trailers hand stacking cases of chips, nuts, cookies, crackers, and meats.
As for what was holding it back, Frito-Lay didn't feel it had much choice. Its loading requirements are somewhat out of the ordinary: Because cases of snack foods are relatively light—about five to seven pounds each—trailers tend to cube out before they weigh out. Although there were loading systems on the market, there was nothing available at the time that could match hand loading when it came to ensuring that every inch of the trailer cube was utilized.
Eventually, Frito-Lay decided to take things into its own hands. Working with a partner, it developed a semiautomated solution that includes a conveyor with a series of "arms" that lob cases onto a stack. Some 10 years later, the two partners took the technology to the next level, devising a fully automated loading solution that uses robots guided by sensors.
Today, half of Frito-Lay's distribution centers use one of the two solutions, with 15 semiautomated solutions in use at five sites and 10 fully automated solutions at four others. The result? Significant gains in productivity and a raft of ergonomic benefits.
REPLICATING THE TOSS
What sent Frito-Lay down this path was a need to boost productivity. The traditional labor-intensive process was becoming less and less appealing as volume ramped up—the company ships out 700 million cases each year. On top of that, the process required a lot of bending and reaching on the workers' part. So the company was eager to find an alternative, explains Andy Fisher, senior director of warehouse operations for Frito-Lay North America (US and Canada).
In 1995, the company approached integrator Wynright about automating the process. Fisher says Wynright was a natural place to turn for help. The two had worked together on a number of DC racking and conveyor projects since 1982, and over the years, the provider had offered many useful suggestions for improving Frito-Lay's operations. "They really knew our business and understood our [distribution centers'] wants and needs," he says.
The team of engineers and project managers assigned to the task kicked off the project by going straight to the source, observing workers as they built stacks by gently tossing cases on top of one another. After watching the workers load trucks, they then tried it themselves. Deepak Aurora, a 30-year veteran of Frito-Lay (now retired), who served as a technical liaison to Wynright, recalls, "We said to the operators, 'All right, you step aside, and we will load the truck, so that we [can] get a feeling for how difficult it is and what all the steps are.'"
Once it had a handle on the process, the team took up the question of how to replicate that gentle tossing action with technology, Fisher says. It determined that this could be accomplished by having the cases shoot off the end of a conveyor. To create the stack, workers would simply change the angle of the conveyor so that the cases would land in the right place, according to Aurora.
To test the concept, one member of the team actually stood inside a trailer holding a small piece of conveyor while other team members experimented with changing the conveyor's speed and angle. The team discovered that at a speed of 400 feet per minute, they were able to stack the cases quickly without causing damage to the product.
Once the two parties had settled on the general concept, Wynright designed a conveyor with a series of arms that shoot the cases out. An operator working inside the truck aims the equipment, which Frito-Lay nicknamed "T. Rex." The conveyor then rises up automatically, and the next case is lobbed on top of the first.
With the semiautomated solution, Frito-Lay could now load trucks twice as fast as it could via the manual process, says Fisher. The solution also offered ergonomic advantages, since workers no longer had to bend, reach, and stretch to position the boxes.
The solution worked so well for Frito-Lay that the two companies filed for a joint patent for the T. Rex truck loader. "Once the thing was designed and built, we looked at the concept and realized that it's really a unique application of available technologies—of how you can put together all these simple technologies and make them into one system that will do the job," Aurora recalls.
FROM DINOSAURS TO ROBOTS
While it was Frito-Lay that came to Wynright with the general concept for a loading system in 1995, 10 years later it was the other way around. This time, Wynright approached Frito-Lay with an idea for an upgrade. Wynright's idea was to take the worker out of the process and instead, use a mobile robot that would move into the trailer, build the load, and then back out again.
After seeing a computer simulation, Frito-Lay gave Wynright the go-ahead. Then, the real work began, recalls Tim Criswell, divisional president for Wynright Robotics. "We collaborated with Frito-Lay [to figure] out how to make that work in their environment under their economic conditions: how the cases would come in, what rate we would have to run at, what reliability we would have to run, those sorts of things," he says. "When we finished that, we took those things and did the detailed engineering and implementing."
The result was a sophisticated solution called a robotic truck loader (RTL), which builds half a stack outside the trailer then drives into the trailer and gently sets it on the floor. Each stack is built to half the trailer's height. After positioning the first stack, the robot places the second stack on top of it, then works its way across the trailer. Once the robot reaches the other end, the system moves it back one case length and it repeats the process.
The biggest challenge in turning the concept into reality was figuring out how to tell the robot where it was inside the trailer. "You can put a robot on a cart and drive it into the trailer, but it's never going to be in exactly the same position," says Criswell.
Wynright solved that by deploying advanced sensor technology. "We used a laser measurement system that would scan the environment and create a cloud of data points on the location of the trailer's floor and walls, and the existing cases," Criswell explains. "The system then analyzes the data, feeds that information to the robot, and off you go!"
According to Criswell, the robot can cube out the truck as well as—or better than—a person can because it's taller and has more reach. That allows the robot to gently place the final cases on the top of the stack instead of having to toss them. Believing they had another unique solution, Frito-Lay and Wynright once again filed for a joint patent.
Fisher reports that the RTLs have brought about significant productivity gains at the sites where they've been implemented, boosting case loading rates from 500 cases per labor-hour to over 1,100. The gains in this case are due to efficiency, not speed. An RTL can't load a truck any faster than a human can, but because a single operator can control three robots at once, it allows workers to be more productive, says Fisher. It was this ability for one person to operate multiple units that justified the cost of the automation for Frito-Lay, Aurora says.
A BLENDED APPROACH
It's worth noting that the introduction of the fully automated robotic truck loader did not make its semiautomated predecessor obsolete. Because the RTL only works with products that have a standard footprint, its application is limited to those DCs that handle nothing but Lay's potato chips and Doritos, which are shipped in standard-size returnable cartons. Facilities that ship cookies, crackers, nuts, or meats in addition to chips use the semiautomated solution.
Regardless of where they're deployed, both solutions have been a hit with workers, Fisher says. "The technicians appreciate that Frito-Lay is making their jobs better and that this has been accomplished without a reduction in manpower except by natural turnover," he reports. "They have really embraced the technology. Instead of standing in a trailer throwing cases for seven hours a day, they're pressing buttons and operating machinery. It's a higher-level [job] for them."
Fisher does acknowledge that he's received one complaint. "I had one guy come up to me and say, 'I have a problem. I find that I'm gaining a little bit of weight because I'm not as physically active as I used to be.' I said to him, 'Well, are you exercising?' He said, 'I think I'm going to have to start. At the end of the day, I'm not diving into my chair anymore. My energy level has really improved.'"
Jeremy Van Puffelen grew up in a family-owned contract warehousing business and is now president of that firm, Prism Logistics. As a third-party logistics service provider (3PL), Prism operates a network of more than 2 million square feet of warehouse space in Northern California, serving clients in the consumer packaged goods (CPG), food and beverage, retail, and manufacturing sectors.
During his 21 years working at the family firm, Van Puffelen has taken on many of the jobs that are part of running a warehousing business, including custodial functions, operations, facilities management, business development, customer service, executive leadership, and team building. Since 2021, he has also served on the board of directors of the International Warehouse Logistics Association (IWLA), a trade organization for contract warehousing and logistics service providers.
Q: How would you describe the current state of the contract warehouse industry?
A: I think the current state of the industry is strong. For those that have been focused on building good client relationships over the years, I think it’s a really exciting time. Coming out of all the challenges of the past few years, I think there’s a lot of opportunity for growth and deeper partnerships. It’s fun to see the automation and AI (artificial intelligence) integration starting to evolve [in a way that’s] similar to what we saw with WMS (warehouse management systems) in the early 2000s.
Q: You are now president of your family firm. Is it an advantage having grown up in the business as opposed to working elsewhere?
A: I definitely believe it was an advantage growing up in the business. Whether it’s working with family or someone else in the industry, there’s always an advantage when you have mentors[to guide] you. I’ve been blessed to have several mentors, some in the industry, others just in life, and I’m thankful that they were willing to mentor me and that I was willing to listen to them.
Q: What are the biggest challenges currently facing 3PLs, and how are you addressing them?
A: Labor and legislation are both tough right now. The two seem to have a lot to do with each other, and it can make it tough to find and retain people. So I think we’ll see more and more automation of processes industrywide.
Q: Third-party service providers often must handle a wide variety of products for a lot of different clients. Does this variety make it difficult to invest in automation and other new technologies?
A: It can make things more difficult when looking at certain automation, but it’s in the “difficult” that a lot of opportunities lie. It would be tough to find a single solution that fits every client’s needs, but there are always opportunities to improve in certain areas. It just takes a bit of vision and commitment, and a willingness to invest in your own long-term success.
Q: As a 3PL, what do you look for when selecting the clients you work with?
A: Quality relationships that will last a long time. When both parties are happy and working together in the same direction, everyone wins.
Q: You’ve been a board member of the International Warehouse Logistics Association since 2021. Why is your involvement with this organization important to you?
A: I think it’s important to understand what’s happening in the industry. IWLA is a great resource for staying up to date and getting a solid education when it comes to the latest logistics trends. I also think it’s important to give back and pass along what we’ve learned to those just getting started in the business. As important as it is to have a mentor, it’s just as important to mentor and help others.
“While there have been some signs of tightening in consumer spending, September’s numbers show consumers are willing to spend where they see value,” NRF Chief Economist Jack Kleinhenz said in a release. “September sales come amid the recent trend of payroll gains and other positive economic signs. Clearly, consumers continue to carry the economy, and conditions for the retail sector remain favorable as we move into the holiday season.”
The Census Bureau said overall retail sales in September were up 0.4% seasonally adjusted month over month and up 1.7% unadjusted year over year. That compared with increases of 0.1% month over month and 2.2% year over year in August.
Likewise, September’s core retail sales as defined by NRF — based on the Census data but excluding automobile dealers, gasoline stations and restaurants — were up 0.7% seasonally adjusted month over month and up 2.4% unadjusted year over year. NRF is now forecasting that 2024 holiday sales will increase between 2.5% and 3.5% over the same time last year.
Despite those upward trends, consumer resilience isn’t a free pass for retailers to underinvest in their stores by overlooking labor, customer experience tech, or digital transformation, several analysts warned.
"The 2024 holiday season offers more ‘normalcy’ for retailers with inflation cooling. Still, there is no doubt that consumers continue to seek value. Promotions in general will play a larger role in the 2024 holiday season. Retailers are dealing with shrinking shopper loyalties, a larger number of competitors across more channels – and, of course, a more dynamic landscape where prices are shifting more frequently to win over consumers who are looking for great deals,” Matt Pavich, senior director of strategy & innovation at pricing optimization solutions provider Revionics, said in an email.
Nikki Baird, VP of strategy & product at retail technology company Aptos, likewise said that retailers need to keep their focus on improving their value proposition and customer experience. “Retailers aren’t just competing with other retailers when it comes to consumers’ discretionary spending. If consumers feel like the shopping experience isn’t worth their time and effort, they are going to spend their money elsewhere. A trip to Italy, a dinner out, catching the latest Blake Lively and Ryan Reynolds films — there is no shortage of ways that consumers can spend their discretionary dollars,” she said.
Editor's note:This article was revised on October 18 to correct the attribution for a quote to Matt Pavich instead of Nikki Baird.
The market for environmentally friendly logistics services is expected to grow by nearly 8% between now and 2033, reaching a value of $2.8 billion, according to research from Custom Market Insights (CMI), released earlier this year.
The “green logistics services market” encompasses environmentally sustainable logistics practices aimed at reducing carbon emissions, minimizing waste, and improving energy efficiency throughout the supply chain, according to CMI. The market involves the use of eco-friendly transportation methods—such as electric and hybrid vehicles—as well as renewable energy-powered warehouses, and advanced technologies such as the Internet of Things (IoT) and artificial intelligence (AI) for optimizing logistics operations.
“Key components include transportation, warehousing, freight management, and supply chain solutions designed to meet regulatory standards and consumer demand for sustainability,” according to the report. “The market is driven by corporate social responsibility, technological advancements, and the increasing emphasis on achieving carbon neutrality in logistics operations.”
Major industry players include DHL Supply Chain, UPS, FedEx Corp., CEVA Logistics, XPO Logistics, Inc., and others focused on developing more sustainable logistics operations, according to the report.
The research measures the current market value of green logistics services at $1.4 billion, which is projected to rise at a compound annual growth rate (CAGR) of 7.8% through 2033.
The report highlights six underlying factors driving growth:
Regulatory Compliance: Governments worldwide are enforcing stricter environmental regulations, compelling companies to adopt green logistics practices to reduce carbon emissions and meet legal requirements.
Technological Advancements: Innovations in technology, such as IoT, AI, and blockchain, enhance the efficiency and sustainability of logistics operations. These technologies enable better tracking, optimization, and reduced energy consumption.
Consumer Demand for Sustainability: Increasing consumer awareness and preference for eco-friendly products drive companies to implement green logistics to align with market expectations and enhance their brand image.
Corporate Social Responsibility (CSR): Companies are prioritizing sustainability in their CSR strategies, leading to investments in green logistics solutions to reduce environmental impact and fulfill stakeholder expectations.
Expansion into Emerging Markets: There is significant potential for growth in emerging markets where the adoption of green logistics practices is still developing. Companies can capitalize on this by introducing sustainable solutions and technologies.
Development of Renewable Energy Solutions: Investing in renewable energy sources, such as solar-powered warehouses and electric vehicle fleets, presents an opportunity for companies to reduce operational costs and enhance sustainability, driving further market growth.
A real-time business is one that uses trusted, real-time data to enable people and systems to make real-time decisions, Peter Weill, the chairman of MIT’s Center for Information Systems Research (CISR), said at the “IFS Unleashed” show in Orlando.
By adopting that strategy, they gain three major capabilities, he said in a session titled “Becoming a Real-Time Business: Unlocking the Transformative Power of Digital, Data, and AI.” They are:
business model agility without needing a change management program to implement it
seamless digital customer journeys via self-service, automated, or assisted multi-product, multichannel experiences
thoughtful employee experiences enabled by technology empowered teams
And according to Weill, MIT’s studies show that adopting that real-time data stance is not restricted just to digital or tech-native businesses. Rather, it can produce successful results for companies in any sector that are able to apply the approach better than their immediate competitors.
“ExxonMobil is uniquely placed to understand the biggest opportunities in improving energy supply chains, from more accurate sales and operations planning, increased agility in field operations, effective management of enormous transportation networks and adapting quickly to complex regulatory environments,” John Sicard, Kinaxis CEO, said in a release.
Specifically, Kinaxis and ExxonMobil said they will focus on a supply and demand planning solution for the complicated fuel commodities market which has no industry-wide standard and which relies heavily on spreadsheets and other manual methods. The solution will enable integrated refinery-to-customer planning with timely data for the most accurate supply/demand planning, balancing and signaling.
The benefits of that approach could include automated data visibility, improved inventory management and terminal replenishment, and enhanced supply scenario planning that are expected to enable arbitrage opportunities and decrease supply costs.
And in the chemicals and lubricants space, the companies are developing an advanced planning solution that provides manufacturing and logistics constraints management coupled with scenario modelling and evaluation.
“Last year, we brought together all ExxonMobil supply chain activities and expertise into one centralized organization, creating one of the largest supply chain operations in the world, and through this identified critical solution gaps to enable our businesses to capture additional value,” said Staale Gjervik, supply chain president, ExxonMobil Global Services Company. “Collaborating with Kinaxis, a leading supply chain technology provider, is instrumental in providing solutions for a large and complex business like ours.”