Victoria Kickham started her career as a newspaper reporter in the Boston area before moving into B2B journalism. She has covered manufacturing, distribution and supply chain issues for a variety of publications in the industrial and electronics sectors, and now writes about everything from forklift batteries to omnichannel business trends for DC Velocity.
When it comes to advances in material handling equipment, storage racking is probably the last category that comes to mind. But experts would challenge that notion in light of today’s modern warehouses and distribution centers, which require diverse storage solutions that can meet varied picking requirements and function alongside a growing array of robotic and automated systems. Such changes are creating the need for innovative storage solutions that can seamlessly integrate with automated technologies and contribute to the primary objective of the modern warehouse: faster throughput and more efficient operations.
To that end, rack manufacturers are taking this warehouse staple to the next level with flexible designs that can accommodate shifting needs. Increasingly, rack manufacturers are designing scalable solutions that combine standard pallet rack with products such as pallet flow rack, carton or case flow rack, and automated storage and retrieval systems (AS/RS)—all under the same roof. Here’s how.
IT ALL STARTS WITH A PALLET
Pallet rack is the most common form of storage in warehouses and DCs, and it serves as the starting point for most modern systems, according to experts at rack manufacturing companySteel King.
“Everyone’s pallets need to sleep somewhere at night,” explains Raymond Weber, regional sales manager for Steel King. “Pallet rack is the place to start. And it can be configured to handle numerous items.”
Those pallets of product are often broken up into smaller units—boxes, cartons, and single items—to fill orders. To accommodate those demands, a system designer will often start with pallet racking and then add other types of racking based on the customer’s applications and workflow. Pharmaceutical and health-care industries provide a good example. Customers in those sectors rely on a first-in, first-out (FIFO) system—which means that products produced or acquired first are sold first, due to the expiration dates on medicines and drugs. This often calls for a pallet flow racking system, which is a high-density storage solution in which pallets are loaded from the rear of the system and move forward along a pitched track of wheels. Systems can be configured to handle pallets just a few layers deep or scaled up, depending on the facility’s needs. When a pallet is removed from the system, the remaining loads roll forward.
Pallet flow racking not only helps condense storage by eliminating aisles in a warehouse but also creates a natural FIFO system. And it can be converted to carton or case flow, in which smaller units flow through the system in essentially the same way, Weber explains. He says combining such systems under one roof is increasingly common in today’s warehouses and DCs.
“[It may be that] 80% to 90% of a warehouse is for bulk pallet storage, but then you get into some areas of pallet flow and some areas of ‘eaches’ [single-item picks],” he says. “You start with this massive warehouse full of everything, and you need to go from pallet to case to individual [item].”
John Clark, Steel King’s director of marketing, agrees, and adds that the ability to change or alter a system is important as well.
“You have to consider, if you put up pallet racking, how easy is it to convert pallet storage to case storage in your operation?” he says, noting that many warehouses are dealing with a larger volume of smaller orders these days, thanks to accelerating e-commerce activity and the need to serve a wider array of customers. “Facilities need the flexibility to handle all that.”
Weber points to health-care companyMedline, a Steel King customer, as an example. The manufacturer and distributor of medical and surgical supplies sells to institutions, businesses, and consumers and recently built a giant DC that features a variety of racking solutions to accommodate its fulfillment needs.
“You go all the way from full pallet loads [down to single items], where they can actually pick one tube of toothpaste,” Weber explains. “E-commerce has driven so many things. Warehouses used to be 100,000 square feet, 200,000 square feet … Medline just completed a 1 million-square-foot DC in Illinois. We also know that Amazon and Walmart can do over 2 million square feet under one roof. It’s the economy of scale.”
And the trend is here to stay. The market for industrial racking systems is set to grow to $16 billion by 2029 from $11 billion in 2022, a roughly 6% compound annual growth rate, according to alate 2022 report from research firm Fortune Business Insights. Global demand for more modern warehouse space that can accommodate increasing e-commerce volumes is a driving force, according to the research.
AND THEN, ADD TECHNOLOGY
In addition to being called upon to create systems that include a wider variety of storage solutions, rack manufacturers are also being challenged to integrate those systems with a growing array of robotic technologies on the warehouse floor. That includes creating traditional systems that form the backbone of the warehouse and “feed” the automated equipment as well as those that work alongside it.
“People have to take into account [that] in order for an automated section of a facility to work, the areas upstream and downstream have to have their houses in order,” Clark explains. “It’s an ‘islands of automation’ approach, but you have to have bridges to make it work.”
Weber points to today’s larger facilities to illustrate the point.
“In years past, warehouses were 25 feet tall, and forklifts only reached four or five [levels] high,” he says. “Now, we’ve done projects where the rack supports the building. It could be 125 feet tall inside, with automated cranes.”
Such an operation calls for higher rack tolerances to withstand the required support for the building as well as the interaction with cranes, he says.
Chris Williamson, vice president of rack manufacturerUnarco, points to the integration with AS/RS technology as a common design requirement—especially in pharmaceutical facilities. Unarco supplies racking for both unit-load AS/RS, which are large systems that store pallets, and mini-load systems, which are smaller and can move vials and bottles stored in totes or trays. A systems integrator will combine the racking with automated equipment that moves the pallets, totes, or trays into and out of storage. He says the automated systems have been used in European pharmaceutical warehouses for years and are now more common in the United States.
“This sector has picked up a lot of steam,” Williamson says, pointing to the need for increased efficiency as the main driver. He notes that there’s growing pressure on operations using pallet racks to find ways to automate the movement of materials and free up workers for more value-added tasks, such as picking. “Everyone is looking for a better way to do things. At this point, it’s all about the lack of available labor and finding a more efficient way to get [products] from point A to point B.”
TheFortune Business Insights research supports those points, noting that end-users’ need to optimize storage space, speed throughput, and address labor challenges will be a prime driver of industrial rack industry growth over the next six years.
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.