right_division Green SCM Distribution
Bookmark us
SCDigest Logo

About the Author

Cliff Holste is Supply Chain Digest's Material Handling Editor. With more than 30 years experience in designing and implementing material handling and order picking systems in distribution, Holste has worked with dozens of large and smaller companies to improve distribution performance.

Logistics News

By Cliff Holste

January 30, 2013

Can DC Operations That Have A Large Mix Of Products Benefit From Material Handling Solutions?

ProMat 2013 & Automate 2013 Included An Array of Gadgets Capable of Handling Practically Anything You Can Think of and At Speeds You Wouldn’t Think Possible!

Recently, we spoke with a logistics executive of a large U.S. based hard goods retailer (we will refer to them simply as The Company) who’s effort to upgrade DC operations have been stymied due to their unusually large mix of products.

Here are a few basic operational statistics:

Holste Says:

Product mix alone is not a determining factor on the adoption path to material handling automation at the DC.
What Do You Say?

Click Here to Send Us Your Comments
Click Here to See Reader Feedback


  • The Company operates out of (8) regular full service DC’s located across the U.S., which are in the 350K to 550K sq. ft. range plus (2) smaller import facilities (managed by expediters). Most of the DCs are in the 30 ft. clear height range.
  • Each DC serves several hundred retail stores.
  • Product offerings include 67,000 SKUs, of which 95% are shipped in less than full case qty.
  • Full case picks amount to less than 5,000 per day.
  • 75% of non-palletized volume is picked to carts pulled by powered tuggers, 10% picked by order picker trucks, and 15% by manual push carts.
  • Pallets, cases, and individual items are all bar coded.
  • The normal operating schedule for the DCs is single shift going to OT or 2nd shift during peaks.


The Company is interested in finding material handling solutions that will reduce per piece handling costs and improve throughput capacity while avoiding expanding its existing facilities or building new ones. However, they have a higher than normal amount of hard to handle and non-conveyable items, which has stymied the adoption of typical material handling solutions.

The following are a few possibilities that come to mind:

With such a relatively small amount of full case picking volume, the typical automated picking and handling solutions would probably not be cost justified. However, this does not preclude deploying highly specialized islands of automation or semi-automation that can be integrated into an overall solution.

  • For starters, The Company could consider case picking solutions like a Gantry Robot System (such as provided by RMT Robotics ) which conserves floor storage while improving cube utilization. The system creates a high density, floor stacked inventory (pod) of full case SKUs then automatically order picks the cases to a conveyor that transports them to palletizing or direct to a shipping trailer(s). System designs and layout configurations are flexible and easily scalable – The Company may need only one or two “pods” making this a cost effective solution.


  • The Company’s manual push cart operation, that processes 15% of the volume, represents “low hanging fruit” – in our opinion. Last week in our blog article At ProMat 2013 – Material Handling Automation Continues To Gain Momentum” we reported on a low cost AGV that we believe has real potential for a variety of low volume picking and order assembly operations. The idea is to eliminate as much non-value-added labor (such as walking) as possible.

  • Then, leaving the best to last, there’s the tugger operation which processes 70% of The Company’s volume. This labor intensive operation can be improved by adopting AGV/robot-based case and piece picking technologies incorporated into a product-to-person “put” type system. In addition, The Company has a huge amount of slow moving SKUs that provides an ideal environment for product-to-picker solutions like a mini-load AS/RS, horizontal and/or vertical carousels.

  • Another “tugger-like” possibility, although less automated than AGVs, that would offer The Company increased productivity at a lower price point would be to replace or upgrade existing order-picker trucks with software enabling the picker and the truck to work together automatically. Sever vendors now offer this type of solution.


Important Store Benefit: - If The Company went a step further and adopted mixed load palletizing technology utilizing robots to assemble picked cases and packages on a pallet according to a predetermined structure, they would be capable of building store ready pallets, where the items are palletized by aisle and in replenishment sequence. The cumulative labor savings across their retail chain alone could be more than enough to justifying the capital investment in this level of automation.


Final Thoughts

The point is that product mix alone is not a determining factor on the adoption path to material handling automation at the DC. This requires a comprehensive analysis that compares and contrasts the company’s changing business and operational requirements to a new generation of material handling solutions. Each product category presents its own set of conditions and challenges leading to appropriate handling methods. The end result is a fully integrated blend of technologies that often includes manual, mechanized, semi-automated, and automated systems each capable of delivering specific operational and financial benefits.


Recent Feedback


No Feedback on this article yet