Faced with the need to step up its fulfillment operations, a well-known beauty and cosmetics company invested in a new goods-to-person shuttle and picking system.
David Maloney has been a journalist for more than 35 years and is currently the group 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.
One of the world's best-known beauty and cosmetics brands recently upgraded its main European fulfillment center in Belgium to keep up with the fast-changing retail times. As is common among distributors, the U.S.-based company (which requested that its name not be used) has seen an increase in orders of smaller quantities that are shipped more often. This means less of the traditional case or pallet picking and more piece picking.
To address this shift, the company last year outfitted the Belgian distribution center, which handles the full portfolio of the company's brands, with a new goods-to-person shuttle and picking system, engineered and integrated by Inther Logistics Automation.
The new shuttle system complements the pick-to-light operation still being used for piece picking within the facility, which is located adjacent to one of the company's manufacturing plants. In addition to installing the new technology, the DC also upgraded its warehouse management system (supplied by Manhattan Associates) to a version that accommodates the batch processing of orders.
INTERNAL MAKE-UP
While the adjacent factory has been producing creams and lipsticks for 50 years, the Belgian distribution center dates back only to 2005. The DC was originally built to serve France, Belgium, the Netherlands, and Luxembourg. Within a few years, however, it was expanded to allow the company to consolidate several other European distribution operations at the site. Today, the facility serves as a manufacturing distribution hub, with factories elsewhere in Europe and in Asia shipping their products there for distribution to 42 other logistics centers worldwide.
In addition to gathering goods from other European and Asian factories, the Belgian facility also consolidates products made in North America and elsewhere for transfer to six major distribution facilities located in Germany, Italy, Spain, Turkey, Greece, and Israel. In addition, the facility ships products directly to some 20,000 customer addresses in 36 different countries.
To manage such a variety of tasks, the company separated the facility into two operations that are connected by a common wall. In one section of the building, a third-party logistics service provider (3PL) performs pallet and case fulfillment. In the other section, direct employees of the cosmetic company handle the piece-picking end of the operation.
The facility manger explains that it is one building with two functions, but they run as an integrated process. He says another third-party provider had previously performed the pallet and case picking at an off-site location, but the results were disappointing. Since the facility already had the piece-picking operation in place, the company decided to move the pallet and case picking there as well. A separate building was erected for this purpose and was eventually expanded to eliminate the gap between the buildings.
In a typical day, the facility processes 120,000 line items and about 30,000 cartons. Overall, it ships about half a million units per year.
SPLIT DECISIONS
On the 3PL side of the building, workers equipped with radio-frequency (RF) terminals pick cases and pallets. Many of these are consolidated from the factories for delivery to the other European DCs. Workers also select cases from reserve storage to replenish the piece-picking operation on the other side of the building.
Pick-to-light remains the primary order fulfillment technology on the piece-picking side of the house. It is used for fast-moving (higher-demand) products and some medium-demand items. The functions are performed via a pick-and-pass method, with order containers passing from one light-directed zone to another. There are 7,000 pick-to-light locations within 45 zones. The use of different colored lights allows two or three people to work in each zone during busy periods. Management says the pick-to-light system was chosen for its guidance, speed, and accuracy.
The warehouse management system (WMS) creates picking waves based on when orders need to be consolidated for shipping. The wave data are then transferred to the Inther warehouse control system (WCS) to carry out the pick processes. The WCS determines the carton size needed for an order and where in the picking loop selection should begin. The cartons pass through the pick zones, with workers adding items to them as directed by the lights.
Up until last year, picking carts were also deployed to gather slow-moving items. The new automated shuttles and goods-to-person systems have since replaced the carts. There were several reasons for this upgrade. First was the amount of time it took for workers to travel to pick locations using the carts. Switching to the new shuttles and goods-to-person systems virtually eliminated the need for travel, reducing both the time and the labor required. It also reduced reliance on temporary labor, which was difficult to find within the area.
Another draw for the cosmetics company was the system's exceptional accuracy. Because it delivers only the product needed for an order to a workstation, there is little chance for error. On top of that, the system is both productive and efficient. Workers at the four goods-to-person stations can each pick up to 250 order lines per hour compared with only 75 lines an hour per person with the pick carts. It also allowed the company to expand its stock-keeping unit (SKU) count to about 18,000. Eventually, the system should enable workers to pick an impressive 300 order lines per man-hour.
Inther engineered and designed the new system using shuttle technology from Knapp AG. The system consists of a large automated storage system and the four goods-to-person picking stations. Due to space limitations, the automated storage is actually located on the 3PL side of the building. Conveyors pass through the wall to link the storage to the goods-to-person picking stations on the other side of the house.
SOPHISTICATED STYLING
The two-aisle automated tote storage and retrieval system contains 26 levels of racking (supplied by Nedcon). There are 52 Knapp shuttles in the system, one per level in each aisle, which move the totes in and out of 16,400 double-deep storage positions. Each shuttle rides on rails and operates only within its assigned level. Each aisle also has two lift elevators with platforms to raise and lower two totes at a time to the various levels and to outbound conveyors that transport the product totes to the picking stations. The four picking stations are located on a mezzanine above a portion of the pick-to-light area.
Two product totes are presented at a time to each workstation, so that one tote can be picked from while the other is departing the station to be replaced by another. The source tote is automatically tilted toward the worker to make item retrieval easier. SSI Schaefer supplied two types of source totes for the system. One is designed to hold a single SKU, while the other has compartments to hold up to four SKUs. A light in front of the tote illuminates to designate which compartment contains the needed SKU. A quantity indicator also displays how many of the fragrances, facial products, moisturizers, and other products to select. The worker then presses a lighted button to confirm pick completion.
A put-to-light system next directs placement of the picked items into four order cartons staged in the workstation. Similar to a pick-to-light setup, the system uses light displays to indicate which cartons should receive products, but only one carton is in play at any given time to assure accuracy. A weight scale at each position confirms that the carton receives the required items.
Once work is completed at the goods-to-person stations, the carton moves off to packing, unless the orders also need fast-moving items from the pick-to-light zones. If so, the carton will be conveyed to the floor level, where they enter the pick-and-pass system. The system also has the flexibility to reverse the pick order, starting with pick-to-light before moving to the goods-to-person area, if it alleviates a bottleneck.
Once all picking is complete, the orders move on to packing stations. From there, they're sent through a pop-up wheel sorter that is located on the 3PL side of the building, which consolidate the cartons for shipping.
APPLYING A SOLID FOUNDATION
Among other benefits, the addition of the shuttle technology and the WMS upgrade have allowed the facility to batch orders. Management explains that the new goods-to-person shuttle technology was needed before the DC could handle the volume associated with batch processing. Without the new technology, the company would have had to double the number of active pick-to-light locations to be fully batch-managed. That would have required adding mezzanines, conveyors, and more. The process would also have been slower, according to the facility manager.
The shuttle technology offered an alternative, as it allows much denser storage for the slow-moving items. Many of the medium-movers are also being transitioned into the automated system, which makes the remaining pick-to-light areas even more effective since their locations now contain primarily faster-moving products that are hit more often.
Another reason for turning to batch management was to comply with increasingly strict European regulations for tracking and tracing cosmetics and other healthcare products. The facility uses first-expired, first-out processing. This requires that a batch be allocated to every single item picked and is another reason why the facility moved to being fully batch-managed now.
The new technology and software will make it possible for the facility to fill up to 180,000 lines per day with a high degree of accuracy and minimal labor.
Online merchants should consider seven key factors about American consumers in order to optimize their sales and operations this holiday season, according to a report from DHL eCommerce.
First, many of the most powerful sales platforms are marketplaces. With nearly universal appeal, 99% of U.S. shoppers buy from marketplaces, ranked in popularity from Amazon (92%) to Walmart (68%), eBay (47%), Temu (32%), Etsy (28%), and Shein (21%).
Second, they use them often, with 61% of American shoppers buying online at least once a week. Among the most popular items are online clothing and footwear (63%), followed by consumer electronics (33%) and health supplements (30%).
Third, delivery is a crucial aspect of making the sale. Fully 94% of U.S. shoppers say delivery options influence where they shop online, and 45% of consumers abandon their baskets if their preferred delivery option is not offered.
That finding meshes with another report released this week, as a white paper from FedEx Corp. and Morning Consult said that 75% of consumers prioritize free shipping over fast shipping. Over half of those surveyed (57%) prioritize free shipping when making an online purchase, even more than finding the best prices (54%). In fact, 81% of shoppers are willing to increase their spending to meet a retailer’s free shipping threshold, FedEx said.
In additional findings from DHL, the Weston, Florida-based company found:
43% of Americans have an online shopping subscription, with pet food subscriptions being particularly popular (44% compared to 25% globally). Social Media Influence:
61% of shoppers use social media for shopping inspiration, and 26% have made a purchase directly on a social platform.
37% of Americans buy from online retailers in other countries, with 70% doing so at least once a month. Of the 49% of Americans who buy from abroad, most shop from China (64%), followed by the U.K. (29%), France (23%), Canada (15%), and Germany (13%).
While 58% of shoppers say sustainability is important, they are not necessarily willing to pay more for sustainable delivery options.
Schneider says its FreightPower platform now offers owner-operators significantly more access to Schneider’s range of freight options. That can help drivers to generate revenue and strengthen their business through: increased access to freight, high drop and hook rates of over 95% of loads, and a trip planning feature that calculates road miles.
“Collaborating with owner-operators is an important component in the success of our business and the reliable service we can provide customers, which is why the network has grown tremendously in the last 25 years,” Schneider Senior Vice President and General Manager of Truckload and Mexico John Bozec said in a release. "We want to invest in tools that support owner-operators in running and growing their businesses. With Schneider FreightPower, they gain access to better load management, increasing their productivity and revenue potential.”
Economic activity in the logistics industry continued its expansion streak in October, growing for the 11th straight month and reaching its highest level in two years, according to the most recent Logistics Managers’ Index report (LMI), released this week.
The LMI registered 58.9, up from 58.6 in September, and continued a run of moderate growth that began late in 2023. The LMI is a monthly measure of business activity across warehousing and transportation markets. A reading above 50 indicates expansion, and a reading below 50 indicates contraction.
October’s reading showed the fastest rate of expansion in the overall index since September of 2022, when the index hit 61.4. The results show that the industry is continuing its steady recovery from the volatility and sluggish freight market conditions that plagued the sector just after the Covid-19 pandemic, according to the LMI researchers.
“The big takeaway is that we’re continuing the slow, steady recovery,” said LMI researcher Zac Rogers, associate professor of supply chain management at Colorado State University. “I think, ultimately, it’s better to have the slow and steady recovery because it is more sustainable.”
All eight of the LMI’s indices grew during the month, with the Transportation Prices index showing the most growth, at nearly 6 points higher than September, reflecting increased activity across transportation markets. Transportation capacity expanded slightly during the month, remaining just above the 50-point threshold. Rogers said more capacity will enter the market if prices continue to rise, citing idle capacity across the market due to overbuilding during the pandemic years.
“Normally we don’t have this much slack in the market,” he said. “We overbuilt in 2021, so there’s more slack available to soak up this additional demand.”
The LMI is a monthly survey of logistics managers from across the country. It tracks industry growth overall and across eight areas: inventory levels and costs; warehousing capacity, utilization, and prices; and transportation capacity, utilization, and prices. The report is released monthly by researchers from Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP).
The port worker strike that began yesterday on Canada’s west coast could cost that country $765 million a day in lost trade, according to the ALPS Marine analysis by Russell Group, a British data and analytics company.
Specifically, the labor strike at the ports of Vancouver, Prince Rupert, and Fraser-Surrey will hurt the commodities of furniture, metal products, meat products, aluminum, and clothing. But since the strike action is focused on stopping containers and general cargo, it will not slow operations in grain vessels or cruise ships, the firm said.
“The Canadian port strike is a microcosm of many of the issues that are impacting Western economies today; protection against automation, better work-life balance, and a cost-of-living crisis,” Russell Group Managing Director Suki Basi said in a release. “Taken together, these pressures are creating a cocktail of connected risk for countries, business, individuals and entire sectors such as marine insurance, which help to mitigate cargo exposures.”
The strike is also sending ripples through neighboring U.S. ports, which are hustling to absorb the diverted cargo, according to David Kamran, assistant vice president for Moody’s Ratings.
“The recurrence of strikes at Canadian seaports is positive for U.S. ports that may gain cargo throughput, depending on the strike duration,” Kamran said in a statement. “The current dispute at Vancouver is another example of the resistance of port unions to automation and the social risk involved with implementing these technologies. Persistent disruption in Canadian port access would strengthen the competitive position of US West Coast ports over the medium-term, as shippers seek to diversify cargo away from unreliable gateways.”
The strike is also affected rail movements, according to ocean cargo carrier Maersk. CN has stopped all international intermodal shipments bound for the west coast ports of Prince Rupert, Robbank, Centerm, Vanterm, and Fraser Surrey Docks. And CPKC has stopped acceptance of all export loads and pre-billed empties destined for Vancouver ports.
Connected with the turmoil, Maersk has suspended its import and export carrier demurrage and detention clock for most affected operations. The ultimate duration of the strike is unknown, but the situation is “rapidly evolving” as talks continue between the Longshore Workers Union (ILWU 514) and the British Columbia Maritime Employers Association (BCMEA), Maersk said.
Terms of the acquisition were not disclosed, but Mode Global said it will now assume Jillamy's comprehensive logistics and freight management solutions, while Jillamy's warehousing, packaging and fulfillment services remain unchanged. Under the agreement, Mode Global will gain more than 200 employees and add facilities in Pennsylvania, Arizona, Florida, Texas, Illinois, South Carolina, Maryland, and Ontario to its existing national footprint.
Chalfont, Pennsylvania-based Jillamy calls itself a 3PL provider with expertise in international freight, intermodal, less than truckload (LTL), consolidation, over the road truckload, partials, expedited, and air freight.
"We are excited to welcome the Jillamy freight team into the Mode Global family," Lance Malesh, Mode’s president and CEO, said in a release. "This acquisition represents a significant step forward in our growth strategy and aligns perfectly with Mode's strategic vision to expand our footprint, ensuring we remain at the forefront of the logistics industry. Joining forces with Jillamy enhances our service portfolio and provides our clients with more comprehensive and efficient logistics solutions."