Group Assignment 5

Scenario:

Your company sells consumer products such as deodrants (Aerosols), mouth wash (flammable) and regular consumer packaged goods such as detergents, diapers, face wash, etc. All these products are temperature controlled between 15-25 degrees Celsius.

70% of the out bound shipments are in full pallets and 30% require a full pallet to be broken to ship out cases. All inbound is in full pallets. There are ~ 1000 SKUs in the portfolio.

The warehousing of products and fulfillment of orders is taking place out of 2 distribution centers located across each other totalling 400,000 sq. ft. with a total capacity of 30,000 pallets. One DC has 16,000 pallet capacity (210,000 sq ft) and the other 14000 pallet capacity (190,000 sq ft). Optimal operation is at 85% capacity.

Customer orders received have products stocked in both the DCs and as such need to be merged in one building before shipping out.

The racking structure in both the buildings is single selective racking.

The current layout of the both the DCs is U shaped

With the significant growth the company has been experiencing, the occupancy in the building has crept up from 70% a year ago to 80% in the current year and is expected to be at 85% in 2022, 90% in 2023 and then go over 100% in 2024, the year which also coincides with the expiry of the lease of the current buildings.

Senior management has advised that they want to move to one, bigger building, if possible, after the lease expiry.

Your team has been tasked to review the situation and provide recommendation on working on the appropriate technology, racking, etc to come up with a warehouse layout and design that can support the growth requirements of the company for the next 10 years. Assume a year over year growth rate of 10% in the pallet positions after 2024.

Provide a written proposal of what you would recommend in terms of layout and storage media to support the increased growth requirements? Include the following elements in your answer

1. What layout design and/or technology will you recommend in your proposal and why
2. What storage media will you use in what parts of the DC will it be consistent throughout or different? Why did you select the same and what advantages will it drive?