October 4, 2010

Automation in the warehouse can improve delivery at the store

Pepsi Bottling Group discovered that the benefits of automating your warehouse don't have to stop at the dock door.

By Susan K. Lacefield

The benefits of automating your warehouse don't have to stop at the dock door. At least that's what Pepsi Bottling Group discovered after embarking on an extensive distribution center automation initiative.

In the past, Pepsi's delivery trucks were loaded in whatever way was most efficient for the warehouse, not the driver. "We made the trucks into rolling warehouses, and the drivers would have to work like they were in a small warehouse," said Tim Thornton, vice president of supply chain logistics for The Pepsi Bottling Group.

What that meant was that drivers had to manually assemble orders once they arrived at the store, which sometimes required moving between 16 and 18 bays on the truck to obtain access to the right SKUs. This chewed up a lot of time that could have been better spent serving and selling to the customer.

Switching to reverse-stop sequencing—a technique in which pallets are built in the reverse order of delivery—resulted in more efficient deliveries, fewer order errors, and more time for customer service. But Pepsi was only able to build loads this way because it had installed high-speed order pickers and pick-to-light systems. These technologies made it easier for the company to build mixed layer pallets quickly as well as to build pallet loads containing all of the SKUs required by a specific customer.