Getting the right distribution center design build can help a company develop process improvements and support your long-term business goals. The end result is a balanced, efficient distribution center design that meets your organization’s individual requirements.
What are some of the biggest benefits of a distribution center design?
With the optimum facility design you will see a reduction of labor cost and improved economy of space. In today’s e-commerce environment, it’s about reducing cycle time and the speed of product to the customer – that’s the bottom line for many companies.
When should you begin a distribution center redesign?
Look at the impact of labor, and interaction of labor and materials handling systems and processes within the warehouse management system. The goals of a facility design are to reduce labor, improve space utilization, improve processes through Lean techniques, and to find the best use of equipment. If your organization could improve in any of these areas, it might be time for a facility design.
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What are the first steps of a distribution center design or redesign?
You must have an understanding of the process, the people, and the place involved in a potential facility design. You and your potential provider must understand what you are currently doing. It is impossible to optimize a process with that understanding. You must look at the data and information available in order to find inefficiencies to see where improvement can be made.
You must make sure your partner understands your baseline procedures. The partner must take site visits and understand the people involved. Document through flowcharts exactly what’s happening today before you think about what should be changed for the future. Developing a good baseline and understanding, through data analysis, is a great start.
What makes for a successful distribution center design?
You must start strategically. Look five to seven years down the line and understand the growth within the warehouse and impact on the supply chain. Take the base line and grow it out. Determine the growth in sales and see how SKUs are growing in order to make a good projection. Will you want more automation for your distribution center? Will you need more storage space as your company grows? Think about these things now.
It is important to not simply take averages throughout the year. There is simply too much variability in the retail environment. It is possible that a large percentage of sales can occur in a short period of time. Merely averaging out the year will lead to faulty determinations as to how the distribution center runs and how it should run in the future. You must examine the peaks and valleys in order to overcome that variability.
Once the implementation is complete, you should determine if the design criteria has been met using a low/medium/high analysis. Examine the impact from an ROI standpoint, impact on labor savings and the impact on the budget.