2005 TLI/WERC Warehouse Benchmarking Report

2005 TLI/WERCWarehouse Benchmarking Report

Edward H. Frazelle, Ph.D.President & CEO, Logistics Resources International

www.LRIConsulting.comDirector, Logistics Management Series, Georgia Tech

www.tli.gatech.edu

2005 TLI/WERC Warehouse Benchmarking Survey - Edward H. Frazelle, Ph.D.

2005 TLI/WERC Warehouse Benchmarking Survey - © Edward H. Frazelle, Ph.D. 2

Participating CompaniesConoco Phillips Cooper ToolsCraft Supplies USACrate and BarrelCreative Storage SystemCrystal Warehouse Corp.Cytec Industries Inc.DFS/Eddie Bauer, Inc.DHL SolutionsDIRECTVDisney Direct DisneylandDistribution Technology IncDollar Tree StoresEagle Global LogisticsEmerson EcologicsESAB Welding & Cutting ProductsEvans Distribution SystemsFairfield Language TechFuji Photo Film, Inc.Fulton County SchoolsGatiGENCOGeneral WarehouseGeorgia PacificGESTOCK LTDAGlaxoSmithKlineGlaxoSmithKline Graebel RelocationGrand & ToyGrohe America, Inc.Home Interiors & Giftshpshopping.comHub One LogisticsHuffy Sports

Hunter IndustriesIntelInternational Truck & EngineJohnsonDiversey N.A.JuL LogisticsK.L.Harring Trans & WhseKeylogistics Chile S.A.King and Prince SeafoodL.L. BeanLanxess Inc.LDS DistributionLimited BrandsLimited - Bath & Body WorksLucentMays chemical Co.Maytag Services, LLCMerial LimitedMindWareMMMMobil Producing NigeriaMorningstar FoodsNACCO Materials HandlingNCRNCSNetafimNFI IndustriesNorwesco, IncNovartis Nutrition corpNu Skin InternationalOak Ridge LabsOcean Air Enterprises, IncOffice DepotOrgillOwens CorningPACAM

PactivPanama Canal AuthorityPendleton Woolen MillsPernod RicardPetra IndustriesPlaid Enterprises Inc.Planar SystemsPocket NursePPL Services Corp.Premiumwear IncProgistix Solutions Purity Life Health ProductsReid Supply CompanyRinnaiRocklineRomark LogisticsRussell Corporationsabare Usa IncShippers Warehouse Co., Inc.Shire PharmaceuticalsSimply Fashion Stores LTDSteiner System Inc.Suncor Energy IncSureSourceSwagelok Co.The Antioch Companythe crosby group incThe Schwan Food CompanyThe Service Center, LTD.Tilia IncTransouth LogisticsU. S. Department of StateUncommonGoodsUPS Mail InnovationsUS Army

180s, LLCAllstateAmerican Distribution CentersAmerican HondaAndersen WindowsAPL LogisticsApplied Industrial TechnologiesARAMARK ASAP Automation Associated Grocers of MaineAugusta SportswearAvanti Press Inc.AvonBarr Laboratories, Inc.Barrett Distribution CentersBAX GlobalBayer HealthCareBC Liquor Distribution BranchBlessOF GmbHBLOOMBERGBlount InternationalBlue Diamond GrowersBlyth Homescents BodenBorders Group Inc.BRAZILIAN CANADIAN COFFEE CO. LTDBriggs & StrattonCardinal HealthCarDomainCARE InternationalCertainTeed CorporationChemPoint.comCoca-ColaColumbia House


Issues Addressed in Warehouse Benchmarking Survey

Warehouse MissionPrimary Unit of MeasurePrimary Ship-To TypeMerchandise Types

Distribution NetworkInbound-Outbound ModesNetwork ConfigurationsOverflow Warehouses

Building ConfigurationSquare FootageBuilding DimensionsClear HeightDock Doors

Facility ManagementOwned vs. LeasedIn-sourced vs. OutsourcedSatisfaction with 3PL ServicesImpact of 3PL ServicesOccupancy Levels

Facility ActivityNumber of Total/Active SKUsNumber of Orders, Lines, Cases

Inventory ManagementInventory TurnsFill Rates

Material Handling SystemsPallet Storage/Retrieval Systems; Case Handling Systems; Broken Case Storage Retrieval Systems

WMS/Information Handling SystemsWMS - Yes/No, Package or In-HouseWMS PlansWMS SatisfactionWMS ImpactCommunication Systems

WorkforceWorkforce TurnoverWorkforce IssuesOperator to Supervisor Ratio

MetricsProductivity MetricsQuality MetricsCycle Time Metrics

PracticesThe “Perfect” Warehouse


The “Median” WarehouseSize

150,000 sq. feetLength to Width

1.7 to 1Clear Height

28.0 ft.Dock Doors

15Staffing

60 FTEsOutsourcing?

Insourced (75%)WMS

Yes (70%)

Shipping564,000 lines/year60,500 orders/year9 lines/order

SKUs5,001 total3,502 active

Occupancy82% normal96% peak

Turn Rate 5.1

Fill Rate97.1%


Warehouse Quality Index (WQI)

Warehouse Quality Index =Shipping Accuracy x Inventory AccuracyShipping Accuracy =% Order Lines Shipped without ErrorsInventory Accuracy =% Warehouse Locations without DiscrepanciesAll warehouses were ranked based their WQI and a WQI rank % calculated as the ratio of the rank to the total warehouses. Those warehouses with lower WQI rank %s have the highest quality performance.


Warehouse Productivity Rank %

All warehouses were classified as piece shipping or case shipping warehouses.All piece shipping warehouses were ranked based on their productivity performance calculated as the ratio of the annual number of order lines shipped to the annual total person-hours expended in the warehouse. The warehouse with the highest productivity received the rank of 1; the warehouse with the second highest productivity received the rank of 2; and so on. The warehouse productivity rank % is the ranking divided by the number of warehouses in the classification with legitimate responses in the survey. The LOWER the RANK %, the HIGHER THE PRODUCTIVITY.All case shipping warehouses were ranked based on their productivity performance calculated as the ratio of the annual number of cases shipped to the annual total person-hours expended in the warehouse. The warehouse productivity rank % is the ranking divided by the number of warehouses in the classification with legitimate responses in the survey. The LOWER the RANK %, the HIGHER THE PRODUCTIVITY.


Inventory Status for Survey Warehouses

6.8%

5.3%

87.9%

0% 20% 40% 60% 80% 100%

Raw Materials

Work-in-Process

Finished Goods


Primary Unit of Measure for Shipping for Survey Warehouses

43.5%

38.2%

18.3%

0% 10% 20% 30% 40% 50%

Less than a FullCarton

Full Cartons

Full Pallets


1.1%

0.6%

1.7%

1.7%

1.7%

2.8%7.9%

9.0%

10.1%

37.1%

26.4%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

1,000,000+

900,000+

800,000+

700,000+

600,000+

500,000+

400,000+

300,000+

200,000+

100,000+

10,000+

War

ehou

se S

ize

(Squ

are

Feet

)

% of Warehouses

Box Size for 2005 Survey Warehouses

The median size of a warehouse in the survey is 147,500 square feet. The maximum size is

1,500,000 square feet.

The median size of a warehouse in the survey is 147,500 square feet. The maximum size is

1,500,000 square feet.


Building ConfigurationsSquare Footage

Clear Height (Feet)

SF per Clear Height

Length (Feet)

Width (Feet)

Length to Width Ratio

No. of Dock Doors

SF per Dock Door

Minimum 3,300 12 40 87 25 0.4 1 567 Average 238,554 32 7,482 806 421 2.2 27 13,046 Median 150,000 28 5,000 500 300 1.7 15 10,238

Maximum 1,516,720 98 34,286 1700 990 5.5 582 69,394

0

0 . 1

0 . 2

0 . 3

0 . 4

0 . 5

0 . 6

0 . 7

0 . 8

0 . 9

1

0 . 5 1 1 . 5 2 2 . 5

L e n g t h t o W i d t h R a t i o

Prod

uctiv

ity R

ank

%


Desired Changes to Building Configurations

31.3%

1.6%

30.5%

7.0%

25.0%

6.3%

57.8%

2.3%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

Higher Ceilings

Lower Ceilings

Deeper Building

Shallower Building

Longer Building

Shorter Building

More Dock Doors

Fewer Dock Doors


North American Network Configuration

3.9% 3.9%1.3%

2.6%5.2%

11.0%

4.5%7.1% 6.5%

11.0%

14.9%

27.9%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%75

-100

50-7

4

25-4

9

15-2

4

11-1

4

8-10 6-

7 5 4 3 2 1

Number of North American DCs

% o

f Res

pond

ents

The median number of warehouses in the North American network is 3.


Survey Warehouse Locations

The “average” network is comprised of 3 warehouses.


Order Line Shipping Volume for Survey Warehouses


Overflow Warehouses

57%

28%

9%

3%

3%

0% 10% 20% 30% 40% 50% 60%

0

1

2

3

4+

Num

ber o

f Ove

rflow

War

ehou

ses

% of Warehouses

The “average” warehouse has0.67 overflow warehouses with it.


Foreign-Domestic Inbound-Outbound

15.9

%

28.3

%

11.5

%

7.1%

7.1%

5.3%

1.8%

7.1%

6.2%

6.2%

3.5%

40.2

% 43.6

%

6.8%

2.6%

0.9% 1.7%

0.0% 1.

7%

0.9%

0.9%

0.9%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Foreign Inbound %Foreign Outbound %

On average, 32% of the inbound volume arrives froma foreign country while 11% of the outbound volumeships to a foreign country.


Inbound-Outbound Mode Disposition

0.0%

0.9%

7.7%

19.7%

53.8%

17.1%

0.9%

0.0%

2.6%

25.4%

29.8%

40.4%

0.9%

0.9%

0% 10% 20% 30% 40% 50% 60%

Next Flight Out

Overnight

Next Day Ground

LTL

Full Truckload

Ocean Container

Railcar

Inbound Mode Outbound Mode


Inbound-Outbound Disposition

1.7%

0.9%

2.6%

6.0%

78.4%

9.5%

0.9%

22.2%

30.8%

14.5%

5.1%

3.4%

19.7%

4.3%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

house or office

store or dealership

retailer's DC

wholesaler's DC

factory or factory DC

distributor

stockroom

Inbound From Outbound To


Insourcing vs. Outsourcing

Future, 73%

Current, 75%

Future, 27%

Current, 25%

0% 20% 40% 60% 80%

Insource

Outsource

CurrentFuture


Satisfaction with Third-Party Logistics Services

16.0%

16.0%

48.0%

20.0%

0.0%

21.0%

37.0%

35.0%

2.0%

5.0%

0% 10% 20% 30% 40% 50% 60%

GREATLY EXCEEDSexpectations

EXCEEDS expectations

MEETS expectations

FALLS BELOWexpectations

FALLS FAR BELOWexpectations

20032005


Impact of Third-Party Logistics Services

20.0%

9.1%

0.0%

20.0%

6.7%

16.7%

20.0%

13.2%

53.3%

27.3%

40.0%

40.0%

33.3%

25.0%

26.7%

35.1%

13.3%

45.5%

40.0%

20.0%

20.0%

50.0%

26.7%

30.8%

13.3%

0.0%

20.0%

0.0%

26.7%

8.3%

26.7%

13.6%

0.0%

18.2%

0.0%

20.0%

13.3%

0.0%

0.0%

7.4%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

Costs

Productivity

Customer Service

Shipping Accuracy

Inventory Accuracy

Information Systems

Workforce Capability

Aggregate

% of Warehouses

Signif icantly Better Better No Dif ference Worse Signif icantly Worse


It pays to measure!

62.0%

22.5%

33.0%

28.3%

29.0%

14.7%

79.0%

0.0%

44.0%

4.3%

34.0%

0.0%

80.0%

0.0%

46.0%

0.0%

34.0%

0.0%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Overall Rank %

Overall % Improvement vs. Baseline

Productivity Rank %

Productivity % Improvement vs. Baseline

WQI

WQI % Improvement vs. Baseline

11+ 8 to 10 Less than 8


6.1%

4.1%

2.0% 6.

1%

2.0% 8.

2%

6.1%

6.1% 8.2%

4.1%

4.1%

4.1% 10

.2%

2.0% 8.

2%

6.1%

6.1%

6.1%

6.1% 10

.2%

12.2

% 18.3

%

20.4

% 28.5

% 34.7

% 40.8

% 49.0

%

53.0

%

57.1

%

61.2

% 71.4

%

73.4

% 81.6

% 87.7

%

93.9

%

100.

0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

<1 1+ 2+ 3+ 4+ 5+ 6+ 7+ 8+ 9+ 10+ 11+ 12+ 13+ 14+ 15+ 20+ 30+

Lines per Man-Hour

% of WarehousesCumulative % of Warehouses

Order Lines per Total Person-Hours for Piece Shipping Warehouses

Average = 12.8 Median = 9.4


35.0

%

2.5% 5.

0%

2.5%

2.5%

15.0

%

5.0%

2.5%

2.5% 5.

0%

5.0%

2.5%

2.5%

0.0% 5.

0% 7.5%

35.0

%

37.5

%

42.5

%

45.0

%

47.5

%

62.5

%

67.5

%

70.0

%

72.5

%

77.5

%

82.5

%

85.0

%

87.5

%

87.5

%

92.5

%

100.

0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

<10 10+ 20+ 30+ 40+ 50+ 60+ 70+ 80+ 90+ 100+ 110+ 120+ 130+ 140+ 150+

Cases per Man-Hour


Outbound Cases per Total Person-Hour

Average = 64.8 cpph Median = 51.7 cpph


Quality Metrics in 2003 Survey Warehouses

34.5%

39.4%

41.2%

44.2%

59.4%

59.4%

62.4%

67.3%

78.8%

20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

Case Shipping Accuracy

Case Picking Accuracy

Putaway Accuracy

Damage %

Line Item Shipping Accuracy

Order Shipping Accuracy

Item Inventory Accuracy

Line Item Picking Accuracy

Location Inventory Accuracy


Quality Metrics in 2005 Survey Warehouses

38.4%

38.4%

52.7%

54.5%

58.0%

70.5%

73.2%

77.7%

81.3%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Case Picking Accuracy

Case Shipping Accuracy

Damage %

Putaway Accuracy

Line Item Shipping Accuracy

Line Item Picking Accuracy


Item Inventory Accuracy

Order Shipping Accuracy


Order Line Shipping Accuracy in Survey Warehouses

2.2% 2.2%

6.7%

15.7%18.0%

21.3%

16.9%

7.9%

4.5% 4.5%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

80+

90+

95+

98+

99+

99.5+

99.9+

99.95

+99

.99+

100

Shipping Accuracy (% of Orders Lines Shipped with Errors)

% o

f War

ehou

ses

Average = 98.59%Median = 99.5%


Location Inventory Accuracy in 2005 Survey Warehouses

1.4%

4.1%

8.2%

11.0%

8.2%

4.1% 4.1%

19.2%

12.3%12.3%

4.1% 4.1%2.7%

4.1%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

60+

70+

80+

90+

95+

96+

97+

98+

99+

99.5+

99.9+

99.95

+99

.99+

100


% o

f War

ehou

ses



Warehouse Quality Index =Shipping Accuracy x Inventory Accuracy

60.00%61.00%62.00%63.00%64.00%65.00%66.00%67.00%68.00%69.00%70.00%71.00%72.00%73.00%74.00%75.00%76.00%77.00%78.00%79.00%80.00%81.00%82.00%83.00%84.00%85.00%86.00%87.00%88.00%89.00%90.00%91.00%92.00%93.00%94.00%95.00%96.00%97.00%98.00%99.00%

100.00%

123456789101112131415161718192021222324252627282930313233343536373839404142434445464748495051525354555657585960616263646566676869707172737475767778798081828384858687888990919293949596979899100

101

102

103

104

105

106

107

108

109

110

111

112

113

114

115

116

117

118

119

120

121

122

123

124

125

126

127

128

War

ehou

se Q

ualit

y In

dex


Average for Top Quartile = 99.65%Median for Top Quartile = 99.76%


Warehouse Inventory Turn Rates

1.1%

10.3

%

17.2

%

17.2

%

5.7%

5.7%

3.4%

5.7%

3.4%

2.3%

2.3%

6.9%

6.9%

4.6%

6.9%

0.0%2.0%4.0%6.0%8.0%

10.0%12.0%14.0%16.0%18.0%20.0%

1+ 2+ 3+ 4+ 5+ 6+ 7+ 8+ 9+ 10+ 11+ 12+ 13-15

16-20

21+

Warehouse Inventory Turn Rate

% o

f War

ehou

ses

Average = 9.9Median = 5.1


Warehouse Fill Rates

1.2%

3.6%

14.3%

17.9%

13.1%14.3%

13.1%

9.5%

13.1%

0.0%2.0%4.0%6.0%8.0%

10.0%

12.0%14.0%16.0%18.0%20.0%

60+ 70+ 80+ 90-94 95-97 98+ 99+ 99.5+ 99.9+

Warehouse Fill Rate

% o

f War

ehou

ses



Occupancy Levels at Normal and Peak Inventory

0.0%

1.8%

4.1%

7.1%

11.8%

16.5%

25.3%

33.5%

12.2%

10.5%

16.9%

15.7%

23.3%

11.0%

7.6%

2.9%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

Less than 70%

70% to 75%

75% to 80%

80% to 85%

85% to 90%

90% to 95%

95% to 99%

99%+

% O

ccup

ancy

% of W arehouses in Range

Norm alPeakThe “average”

warehouse in the survey is 82% full at “normal” inventory levels and 96% full at “peak” inventory

levels.

2003 Survey Results


Dock to Stock Time

3.9%

11.8%

21.6%

13.7% 12.7%

7.8%

18.6%

6.9%

2.9%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

<1 1+ 2+ 3-4 5-8 9-12 13-24 25-48 49+

Dock to Stock Time (Hours)

% o

f War

ehou

ses



3.7% 9.

9%

3.7% 6.

2%

4.9%

13.6

%

1.2%

22.2

%

8.6% 9.9%

3.7%

2.5%

9.9%

3.7%

13.6

%

17.3

% 23.5

%

28.4

%

42.0

%

43.2

%

65.4

% 74.1

% 83.9

%

87.7

%

90.1

%

100.

0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

<1 1+ 2+ 3+ 4+ 5+ 6+ 10+ 15+ 20+ 30+ 40+ 50+


Workforce Turnover

Average = 16% Median = 10%Workforce Turnover %


Workforce Turnover vs. Warehouse Quality

96.08%

95.44%

93.57%

91.57%

90%

91%

92%

93%

94%

95%

96%

97%

Warehouse Quality Index

Less than 5%

5% to 10%

10% to 25%

25%+

Wor

kfor

ce T

urno

ver

2003 Survey Results


Workforce Challenges

10%

12%

21%

45%

47%

0% 10% 20% 30% 40% 50%

Drugs/Alcohol

Literacy

Multiple Languages

Aging

Turnover

% of Warehouses


It pays to pay!Pay Scales for Survey Warehouses

4.8%

42.2%

47.6%

4.1%

1.4%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0%

Far Above Average

Above Average

Average

Below Average

Far Below Average

The average Warehouse Quality Index for Above Average Pay = 98.3%.

The average Warehouse Quality Index for Average Pay = 90.3%.

2003 Survey Results


0%

10%

20%

30%

40%

50%

60%

70%

80%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%% of Warehouses

% o

f War

ehou

se W

orki

ng H

ours

Full-Time Staff - Regular Hours Full-Time Staff - Overtime HoursPart-Time Staff - Regular Hours Part-Time Staff - Overtime Hours

Warehouse Working Hours Profile

Full-Time Staff - Regular

Hours64%

Full-Time Staff - Overtime

Hours18%

Part-Time Staff - Regular

Hours14%

Part-Time Staff -

Overtime Hours

4%


Operator to Supervisor Ratio0.

7%0.

7% 1.5% 2.2%

0.7% 2.

9%0.

7% 3.6%

0.7% 4.

3%2.

9% 7.3%

0.0%

7.3%

2.9%

10.2

%0.

7%10

.9%

0.0%

10.9

%4.

4%15

.3%

2.2%

17.5

%4.

4%21

.9%

4.4%

26.2

%7.

3%33

.5%

5.1%

38.7

%4.

4%43

.0%

5.1%

48.1

%3.

6%51

.8%

6.6%

58.4

%9.

5%67

.9%

5.8%

73.7

%8.

0%81

.7%

3.6%

85.4

%8.

8%94

.1%

2.2%

96.3

%3.

6%10

0.0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

30 29 28 26 25 24 23 22 21 20 19 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2Operator to Supervisor Ratio

%Cum%


Productivity Best = 12Quality Best = 8


2.2%1.1%

3.2% 3.2%2.2%

5.4%

16.1%

8.6%

19.4%18.3%

20.4%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

<10% 10%+ 20%+ 30%+ 40%+ 50%+ 60%+ 70%+ 80%+ 90%+ 100%

% Active SKUs

% Active SKUs



4.4%

4.4%

4.4% 6.6%

6.6%

6.6%

4.4%

3.3% 8.

8%

3.3%

0.0% 2.2% 8.

8% 9.9%

6.6%

4.4%

3.3% 4.4% 7.

7%

4.4% 8.

8% 13.2

% 19.8

% 26.4

% 33.0

%

37.4

%

40.7

% 49.5

%

52.8

%

52.8

%

54.9

% 63.7

% 73.6

% 80.2

%

84.6

%

87.9

%

92.3

%

100.

0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

<1 1+ 5+ 10+

20+

30+

40+

50+

60+

70+

80+

90+

100+

200+

300+

400+

500+

1000

+20

00+

Annual Lines Shipped per SKU


Annual Order Lines per SKU

Median = 75

WeeklyMonthly

Daily


Annual Lines per SKU vs. Productivity Rank %

32.2%

41.2%

41.8%

47.8%

30% 32% 34% 36% 38% 40% 42% 44% 46% 48%

Productivity Rank %

1000+

500s-900s

100s-400s

1-90s

Ann

ual L

ines

per

SK

U

HighPerformance

LowPerformance

2003 Survey Results


Warehousing Cost to Sales Ratio

13.9%10.1%10.1%

11.4%2.5%

6.3%6.3%6.3%

3.8%5.1%

1.3%3.8%3.8%

1.3%3.8%

10.1%0.

0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0

%

11.0

%

12.0

%

13.0

%

14.0

%

15.0

%

0 .5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

5.0%

5.5%

6.0%

6.5%

7.0%

7.5%

8.0%

War

ehou

sing

Cos

t to

Sale

s R

atio

% of Warehouses

Average cost to sales ratio = 3.4%


WMS Providers in 2005 Warehouse Benchmarking Report

• Aquitec

• Asset Contols Inc.

• Baan ERP

• CA Warehouse Boss

• Data Control Systems

• Dydacomp

• ECOMETRY

• Exe

• HAL SYSTEMS

• HighJump

• INDUS

• Intentia-MOVEX ERP

• Interlink

• LDS Accuplus• ADPICS

• Renaissance Software, Inc.

• Red Prairie (McHugh)

• Optum

• Exeter

• EXE

• DSI

• Catalyst

• Provia

• Oracle

• HK Systems

• Adonix

• Irista (4)

• Manhattan Associates (7)

• SAP (8) • MARC Global

• Nfor

• Radio Beacon

• Renaissnce Software

• Retek

• Sigma Micro

• Smith & Gardner

• Ecometry

• World Wide Chain Store

• Yantra


State of WMS

70.4%

79.7%

79.0%

58.0%

23.8%

29.5%

20.3%

21.0%

42.0%

76.3%

0% 20% 40% 60% 80% 100%

WMS In Place

WMS DevelopedExternally

WMS HostedInternally

WMS Part of ERP

WMS Integratatedwith TMS

NoYes


WMS Plans

2%

14%

29%

32%

47%

0% 10% 20% 30% 40% 50%

Transition to anASP-based Model

Transition to aStandalone WMS

Transition to anERP-based WMS

Integrate WMS withTMS

Maintain the StatusQuo

% of Warehouses


Warehouse Communication Methods

1.8%

3.5%4.4%

7.0%7.0%

7.9%

43.0%57.9%

71.1%88.6%

0.0% 20.0% 40.0% 60.0% 80.0% 100.0%

Voice Headsets

Handsfree RF Terminals

PDAs

Optical Characters

Radio Frequency Tags

Pick-to-Light

Vehicle Mounted RF Terminals

Handheld RF Terminals

Bar Code Scanning

Paper

% of Warehouses


Level of Information Handling Automation vs. Warehouse Productivity Rank %

42.8%

40.4%

33.3%

0.0%

5.6%

28.8%

0% 10% 20% 30% 40% 50%

Stage I (Manual)

Stage II (Semi-Automated)

State III(Automated)

Productivity Rank % % Improvement vs. Baseline


RFID Implementation Plans

8%

8%

8%

13%

64%

0% 10% 20% 30% 40% 50% 60% 70%

Already Implemented

Plan to Implement in 1 Year

Plan to Implement in 2 Years

Plan to Implement in 3+ Years

No Plan to Implement

% of Warehouses


Pallet Storage Modes in Survey Warehouses

0.9%

5.2%

8.7%

9.6%

12.2%

18.3%

21.7%

24.3%

33.0%

46.1%

80.9%

82.6%

88.7%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

AGVS

ASRS Machine

Sideloading Truck

Push-Back Rack

Straddle Truck

Drive In/Through Rack

Turret Truck

Pallet Flow Rack

Double Deep Rack

Straddle Reach Truck

Floor Storage

Counterbalance Lift Truck

Single Deep Rack


Case Picking Devices

6.7%

12.4%

13.3%

19.0%

51.4%

58.1%

67.6%

0% 20% 40% 60% 80%

Layer Pickers

Tuggers

Sortation Conveyors

Pick-to-Belt Conveyors

Counterbalance Lift Trucks

Man-aboard Order Pickers

Pallet Jacks


Broken Case Picking Equipment

2.3%

3.4%

9.1%

25.0%

45.5%

83.0%

0% 20% 40% 60% 80% 100%

Vertical Carousels

Automated Dispensing

Horizontal Carousels

Storage Drawers

Flow Rack

Bin Shelving


Material Handling Automation vs. Warehouse Productivity

30.3%

28.3%

13.1%

0% 5% 10% 15% 20% 25% 30% 35%

Manual

Mechanized

Automated


Practices in Place in 2005 Survey Warehouses

7.4%

12.2%

29.0%

35.4%

44.8%

49.0%

50.5%

51.0%

51.1%

54.7%

60.0%

61.2%

63.5%

64.2%

68.8%

78.1%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

RFID Tags

Interleaving

Weigh Checking

Activity Based Costing

Cross Docking

Ergonomics Programs

Item Cube Information

Continuous Improvement Teams

Popularity Slotting (Golden Zoning)

Directed Putaway

ABC Cycle Counting

ASNs

Pick Location Verification

Productivity/Time Standards

Putaway Location Verification

Cross Training


Practices in Place

4.5%4.5%3.6%

8.1%7.2%

12.6%

5.4%

9.9%

15.3%

9.9%

7.2%7.2%

1.8%0.9%

1.8%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Number of Practices in Place

Median = 8


It pays to practice!

47.1%

43.2%

35.8%

27.3%

0.0%

8.3%

23.9%

41.9%

0.0%

8.3%

17.0%

23.6%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Baseline (< 5)

Middle Class (6 to 8)

Upper Class (9 to 11)

World-Class (12 to 15)

Sta

ge (N

umbe

r of P

ract

ices

in P

lace

)

Productivity Rank % % Improvement vs. Baseline Stage % Improvement vs. Previous Stage


The “Perfect” WarehouseA building 600 feet long, 300 feet wide, 30 feet clear with 180,000 square feet in a rapidly appreciating area inside a freetrade zone within 24 hour delivery of all U.S. zip codes, in close proximity to a highly skilled and motivated workforce, and within walking distance of a major U.S. port.The building is 80% occupied during “normal” inventory levels and 90% occupied during “peak” inventory levels.The operation is a hybrid insource-outsource model with the perfect outsource provider(s) chosen to perform those activities inside the warehouse that SHOULD BE outsourced.The operation is supported by a WMS provided by an ASP enabling all world-class warehousing practices and integrating with a wide variety of paperless communication devices chosen perfectly to meet the unique needs of each activity within the warehouse.


The “Perfect” Warehouse

The workforce is cross-trained with an operator to supervisor ratio of 8 where QUALITY is the key success driver and 12 where PRODUCTIVITY is the key success driver and where operators are delighted with average to above-average pay.The SKUs would be highly active, yielding 1000+ hits per year on average.An APPROPRIATE level of material handling technology is in place, each device chosen to perfectly match the handling requirements of the task.A holistic set of financial, productivity, quality and cycle time metrics work together to motivate and maintain world-class warehouse performance.


Contact Information

The Logistics Institute at Georgia Techwww.tli.gatech.edu

Logistics Resources Internationalwww.LRIConsulting.com

Edward H. Frazelle, [email protected]

Date post:	13-Nov-2021
Category:	Documents
Upload:	others
View:	2 times
Download:	0 times

2005 TLI/WERC Warehouse Benchmarking Report

Documents