spacesaver active rack slow moving inventory offer

8/13/2019 Spacesaver Active Rack Slow Moving Inventory Offer

1/6Mitigate the negative effects of slow-moving inventory

Mitigate the negative effects

of slow-moving inventoryHow to apply the 80/20 rule in conjunction with high-density storage to

optimize productivity and efficiencies in small- to mid-sized facilities


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4. Periodically review slotting strategies.Once the true slow-movers, or products that stillhave sales but lower inventory turns, have been isolated, audit where youve putor slottedthemin your facility. Operations with no automated slotting programs often nd slowmovers mistakenly slotted in premium storage or assembly areas. If you have a WarehouseManagement Systems (WMS), consider leveraging built-in slotting software to periodicallytrack slotting decisions based on the latest movement and inventory proles. Proper slotting

ensures that product is located in the most appropriate position, in the most appropriatestorage module, and has been allocated a sufcient amount of space within that module.

Second, consider your options for pallet storage.Once those 80% of low-turn SKUs have been kept under control, lets examine the assortmentof pallet storage options available for them. Here the focus is not necessarily on throughput,but the ability to hold more facings, while utilizing a minimum amount of space. Inmanufacturing, it gets more complicated as modules storing raw material and WIP (Work InProcess) inventory not only need to occupy minimal oor space, but ideally, they also have tobe in close proximity to where they are needed to avoid unnecessary delays.

There is no one-size-ts-all solution. Depending on inventory proles, different types ofmodules may be required.

Bulk Storage:Also known as oor storage, bulk

storage is the stacking of pallets to a limited height on theoor without installing any storage equipment. Whileit may be the least expensive option, its application isconstrained to SKUs with higher pallet quantitiessuch as bulk discount purchasesas all pallets in abulk storage lane must be the same SKU to avoid anyadditional handling. Lift truck accessibility to the palletis limited to the front pallet or facing and typicallyrequires the widest aisles of all the storage options. Thedeeper the bulk storage lanes, the more compromises tospace utilization because of the wasted space created bypartially lled rows and stacks of storage. With pallets

stacked directly on top of each other, the tendency forproduct damage is highest.Static Rack Systems: These rack systems are

composed of uprights bolted to the oor and beams thathold pallet loads of storage in a variety of congurations.(Figure 2)

The simplest are selective, or single deep racks, wherestorage is limited to one pallet deep, creating 100%accessibility to each and every pallet. A load can be storedor retrieved without handling any other load, allowingfor completely random access. The drawback with thisconguration is that it requires the most access aislesof up to 12 feet. While Narrow and Very Narrow Aisle

(VNA) selective rack congurations can noticeably reduce access aisles to as low as 6 feet,more expensive, specialized trucks will be required to maneuver in these narrower aisles.Drive-in racks are denser storage options that can store pallets up to eight deep and up

to four high. The lift truck driver enters and exits the storage lane from the same aisle. As inbulk storage, the same SKU should be stored within the lane to avoid additional handling.Inventory control is limited to Last-in, First-Out (LIFO). Because lift trucks drive into the racklanes, these racks are subject to the most damage than any other rack congurations.

Push-back racks place pallet loads on nesting trolleys at each storage level and the lift truckpushes the inner pallet back into the racks when putting away the front pallet. Because ofthis conguration, inventory control is limited to LIFO. Handling the pallet is faster with lessdamage as this system uses gravity to index and present the front pallet for retrieval to the lifttruck driver. It needs only one access aisle for both retrieval and replenishment.

Mitigate the negative effects of slow-moving inventory

Inventory Management

Figure 2:Side-by-side comparison of staticrack options versus mobilized storage

Selectiveor SingleDeep Rack

Types ofRacking

Damageto Storage

and Handling

Low

Low

High

Medium

Medium

Low

Stor

ageVo

lumein

Cubi

cFee

t(4,00

0Pa

llets)

1,186,584

%ofL

oadAc

cessible

forF

orkTr

uck

100% 32,830

Floor

Are

ato

Sto

rage

inSqu

areFe

et

StockRo

tatio

n

RandomAccess

Narrow

Aisle Rack 911,127 100% 25,292 Random

Access

Drive-InRack 865,218 10-33% 24,757

Last In,First Out

PushbackRack 957,037 25-50% 25,834

Last In,First Out

Pallet FlowRack 1,115,951 10-20% 29,601

First In,First Out

MobilizedStorage 635,670 100% 17,761

RandomAccess


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Pallet ow racks move pallets from the loading end to the retrieval end on sloped beamlevels equipped with heavy duty, skate-wheel conveyors. This conguration allows onlyFirst-In, First-Out (FIFO) inventory control and requires two separate aisles for loading andretrieving (as opposed to drive-in and push-back racks). Per pallet position, it is also the mostexpensive static shelving available.

Pros and cons of bulk storage and static rack systems.While selective or single deep

racking provides 100% access to each and every pallet, the need for multiple access aislessignicantly inates space requirements.

Bulk Storage, drive-in racks, pallet ow racks and push-back racks may be denser, morespace efcient storage alternatives, but access to each pallet load is not 100% and inventorycontrol options are limited to either FIFO or LIFO, not both.

Mobilized Storage Systems:These systems mobilize existing pallet racking and industrialshelving by mounting them onto industrial grade-carriages with capacities in excess of 60,000lbs. per back-to-back rack section. These carriages then travel on rails or tracks that are surfacemounted on or embedded into the oor. Unlike traditional static rack systems, mobilizedstorage systems require just one moving aisle that opens and closes only where and whenneeded to provide full accessibility to all materials for quick, safe retrieval.

With all storage positions readily accessible, the system allows for random inventorycontrols such as FIFO and LIFO, without compromising productivity and allowing for 100%

accessibility. A radio frequency (RF) remote enables an operator to create an unoccupied aislebefore traveling to it, eliminating delays waiting for an aisle to be opened. A rechargeablebattery back-up power unit keeps the system functional during a power outage. (Figure 3)


Mobilizedstorage systemswith existingpallet racks

Figure 3:Examples of mobilized storage systems

Mobilizedstorage systemswith industrialshelving

These systems mobilizeexisting pallet rackingand industrial shelvingby mounting them ontoindustrial grade-carriageswith capacities of up to60,000 lbs. per back-to-backrack section. These carriagesthen travel on rails or tracksthat are embedded into thefloor.



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Pros and cons of mobilized storage systems.Using mobilized storage systems offer manybenets for manufacturing and warehousing. Up to 50% of space is freed up by eliminatingall xed access aisles. Plus with new technologies, mobilized storage can accommodate awide range of capacities on existing atbut non-level oors. Rails can be mounted ontop of the existing oor providing reconguration exibility for additional storage or for

re-assignment to revenue-generating activities, such as the addition of another productionline or the establishment of a new prot center. (Figures 4, 5) In manufacturing, throughputand changeover rates can signicantly increase by locating your highest need parts and WIPin compact mobilized storage right at the actual work cell or production line. This leads to areduction in fork travel with less wear- and-tear and less emissions. (Figure 6)

What are the cons? At rst blush, access to only one aisle at a time might be seen as limitingthe system to low trafc areas. However, through thoughtful analysis of how storage ishandled in a given facility, mobilized modules can be designed to allow for simultaneousactivity within the system based on zone picking strategies. Price points are also slightlyhigher than some static rack solutions. This is quickly dismissed when considering thedramatic increase in available space afforded by these systems within existing facilities and in



Figure 4: Using mobilized storagesystems for significant increases instorage capacity

With its multiple space-consuming aisles, conventional single

deep racking wastes a significant amount of space you couldbe using for storage.

BEFORE

AFTER

With mobilized storage systems, one moving aisle replacesmultiple dedicated aisles required by static configurations,creating up to 100% more space for more racking or shelvingunits in the same footprint.

Figure 5:Freeing up space forrevenue-generating activities withmobilized storage systems

Static racking takes up valuable floor space that could be

devoted to a production line or other value-added activitiesinstead of storage.

By eliminating the need for multiple aisles, mobilized storagesystems can free up as much as 50% of your existing storage spacefor revenue-generating activities without expanding intonew space.

BEFORE

AFTER


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reality can often be the ultimate game-changer. Plans tocontract for outside storage or 3PL strategies, buildingexpansions, or even build a whole new facility can bedelayed, or perhaps eliminated.

Third, apply the 80-20 rule to pick

the best storage configuration.Keeping these storage options in mind, the next step isto determine which option works best for which groupof SKUs based on the 80-20 rule. (Figure 7)

On the manufacturing oor, when trying to locateneeded materials at the point of use, 80-20 can be readilyapplied to the storage of raw and WIP materials toenhance productivity and efciency. Raw materials areconsumed at varying rates and should be analyzed.When the work cell uses 20% of all the raw materialsat a high rate, centralizing the remaining, slower-turnmaterials (typically the 80%) can provide additional pickfaces for the faster-turn materials to keep lines running

at optimal efciency. Storing these 80% in mobilizedstorage systems provides the needed storage locationswhile minimizing space requirements.

In nished good storage, the analysis of SKUvelocities and revenue per SKU help determineunique 80-20 SKU splits, as was previously discussed.Compacting the slower-moving SKUs will open up areasfor increased SKU locations for the faster-moving SKUs(the 20%) that will account for 80% of the companysrevenue. Mobilized storage is designed to accommodateexisting storage methods for these SKUs and provide acompact solution to recover wasted storage space. The

faster-moving SKUs will, in most scenarios, slot intostatic racking with xed aisles due to the speed at whichthey need to be picked. Recovered oor space fromthe compaction of the slower-movers with mobilizedstorage may also allow additional static racking or evenoor staging nearest the docks enabling faster load timesand faster truck turn times. The faster a truck can leavethe dock, the more revenue the company can count ondown the supply chain.

ConclusionFor many small to mid-sized facilities, space is alreadyat a premium. Strategies for increasing productivity

and efciency are typically focused on work cellmodications, buy vs. make analysis and inventorycontrol. However, by simply focusing on the 80% oflow-turn inventory SKUs and employing a combinationof smart inventory management tactics and space-saving storage equipment solutions, a substantialamount of hidden space within an existing facility canbe uncovered. When such space differential is largeenough so as to delayeven eliminatemulti-milliondollar new space investments, thats priceless.

When essential supply materials are poorly located away from

production lines, it means extra travel and delays for workers.

Mobilized storage systems allow you to strategically store and organizenecessary supplies and materials close to production lines.

BEFORE

AFTER

Production Line

Production

Line

Production

Line

Production

Line

Production Line

Production

Line Production

Line

New

Production

Line

Production

Line

Figure 6: Increasing productivity andthroughput with mobilized storagesystems

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

Percent of Total SKUs

PercentofTotalMovement

0 .3 % 0 .9 % 3 .3% 7 .3% 13 .5 % 23 .0% 4 3. 1% 1 00 %

FastMoversStatic

RackingMediumMovers

StaticRacking

Slow MoversMobilized StorageSystems (86.5% of

SKUs with 17.2% ofVolume Movement)

Figure 7: Applying the 80-20 rule tostorage options


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spacesaver active rack slow moving inventory offer

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