The leading edge

Every carpenter knows that the work isn't done until the finishing touches have been added. For 25,000 carpenters and cabinetmakers throughout Europe, that often includes adding edgings along with knobs, handles, hooks, and other hardware from Rudolph Ostermann GmbH.

What are edgings? They're the finishing strips that go on the end of a cabinet or countertop. Once a carpenter cuts a piece of material to size, there remains a rough unfinished edge. An edging piece is then glued on to provide a professional finish. Ostermann is the largest supplier of edgings in Europe, and edging accounts for 70 percent of its annual sales.

Ostermann distributes these products from a facility located in Bocholt, in the northern Rhine region of Germany near the border with the Netherlands. The 11,000-square-meter (118,403-square-foot) facility handles around 3,000 orders daily, consisting of about 5,000 order lines. The distribution center also ships to carpenters, furniture stores, and office supply stores throughout Europe and to select customers in other countries, including the United States. Orders received by 4 p.m. ship the same day, with next-day delivery throughout Germany and nearby nations.

In order to keep up with demand and improve its product handling, the family-owned company erected a high-bay building outfitted with an automated storage and retrieval system (AS/RS) in 2012. The facility was designed by SSI Schaefer, which also served as the systems integrator. The project included the material flow design, construction of a rack-supported high-bay building, the installation of the automated storage system and connecting conveyors, and seamless integration with the warehouse management system. The automated system now helps Ostermann organize its stock and keep pace with growth.

"We considered just building a warehouse with racks in it, but we realized that it would be slow to process orders," says Christof Wauters, logistics and material manager for Ostermann. "A manual warehouse would have reduced the performance of the picker. That is why we chose automation. The system also takes up less space in the building and reduces errors," he says.

The AS/RS is used to house products that replenish picking areas. Hardware and other decorative products are stored in the automated system, along with 1,500 different edging products (the edgings come in wood tones and just about every color of the rainbow, as well as in a variety of widths). The variety results in more than 7,000 different SKUs (stock-keeping units).

Suppliers deliver the edgings in large rolls that lie flat on pallets. These pallets are placed onto conveyors that feed the AS/RS. The system offers 10,000 storage locations for pallets arrayed along its two aisles, both of which are 120 meters (394 feet) long. Each aisle has a crane to pick up pallets for storage and retrieve them when needed for replenishment. The rack measures 24 meters (78 feet) high, and the system provides some 45,000 cubic meters (more than 1.5 million cubic feet) of automated storage space.

At the time the automated system was installed, Ostermann was already using an SAP warehouse management system to direct distribution operations. Once the high-bay warehouse was built, the company added the SAP Task and Resource Management application to control the automated functions. Ostermann reports that the integration of the two SAP systems was seamless, with no additional IT changes needed. The SAP software now manages the entire automated processes, including the placement of pallets into storage positions.

Today, about 75 percent of the facility's total products pass through the high-bay AS/RS. The process starts at the building's docks, where pallets of inbound materials are offloaded from trucks. After the pallets are labeled, they're placed onto conveyors by lift trucks. The conveyors automatically carry the pallets to the AS/RS.

Throughout the day, the AS/RS replenishes static racks that hold products for picking. The management software directs the cranes to retrieve pallets and deposit them onto conveyors. Lift trucks gather the pallets from the conveyors and transport them to the static racks. The racking is five to nine levels high, depending on whether the section is pallet racking or rack shelving. There are a total of 12,000 storage positions in the static area.

Associates use paper lists to pick products from the racks using order picker trucks. From five to 10 orders are batch picked at a time onto a pallet and then separated into individual orders later. The SAP software determines the optimal pick path to minimize travel and labor for the order pickers.

Because many customers don't want to buy a full roll of edging, Ostermann will cut pieces to size for specific orders. If this service is needed, the rolls are picked and taken by lift truck to cutting stations, where the amount required for an order is measured from the roll, cut, and placed onto shipping pallets using a robotic palletizer and an automatic stretch-wrapping machine. Most orders ship by parcel carrier.

Another section of the building is outfitted with powered cantilever racks. Longer strips of products measuring up to six meters (about 20 feet) are placed onto the racks for storage and direct picking. Motors and wheels on the rack sections allow them to glide tightly together to provide dense storage or roll apart to create an access aisle.

As for how the new system is working out, since moving to the SSI Schaefer automated system, Ostermann has been able to handle increased volumes in a smaller footprint. It has also optimized its processes, which has led to better labor utilization and improved real-time inventory tracking.

"If we had not added the high-bay automated system, we also would have had to hire more personnel. Plus we gained accuracy," notes Wauters. "It was our first automated system, and now we are looking at installing a goods-to-person system for picking."