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The biggest trend encountered by distributors today is increasing customer expectations, both at the commercial and consumer levels. "In the information age," says Kohl, "folks know what's available. When they place their order they expect to get what they want, when and the way they want it."
The growing variety of product types is a contributing factor to the mix. The proliferation of SKUs, many of which might be slow-moving items, leads to greater complexity within a distribution center. Product configurations differ widely, as well as box sizes and the makeup of palletized loads.
Surprisingly, distributors are in "excellent position" to address these challenges, Kohl claims. They are armed with extensive data about each SKU, order and customer. Products in the warehouse can be organized according to customer order profiles, making the fast movers more accessible.
The single most important metric affecting productivity is the length of the pick line, Kohl says. "Sixty percent of labor cost is the picker - the person assembling the order. And 60 percent of his time to pick an order is traveling." By properly managing the pick-line layout, distributors can significantly reduce operational costs and the time it takes to process an order. "Just improving productivity by one case picked each hour will lead to $80,000-$100,000 a year [in savings] for that organization," he says.
Warehouse operators need to know their slow and faster movers. That information rests with the pickers - "the ones who really have the pulse of the operation," says Kohl. Still, it's not enough to rely on hearsay or anecdotes. Distributors need to have strict metrics in place, contained with the slotting software that is part of most warehouse-management systems.
"Very few people take advantage of that on a regular and consistent basis," says Kohl.
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Keywords: supply chain, supply chain management, inventory management, inventory control, WMS, warehouse management systems, WCS, warehouse control systems, logistics management, supply chain planning, retail supply chain
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