Grocery Retailer Increases Capacity and Productivity

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A full line self-distributing grocery retailer serving over 150 company-owned stores.

Scope of KOM International's Mandate

The client's dry grocery distribution center needed to be reconfigured to handle increased growth in product variety, throughput volumes and inventory levels. KOM International was hired to perform a study of the dry grocery operation to recommend the most suitable distribution layout and operating method changes.

Critical Issues

• Shortage of storage capacity for products, throughput volumes and inventory
  
  
• Labor productivity
  
  
• Long truck loading times
  
  
• Transportation inefficiency

Objectives

• 
  · Reset the grocery distribution center
  · Improve operating procedures at distribution
  · Reduce transportation operating costs
  · Provide stores with improved store-friendly pallets

KOM International's Recommendations

• Improved inventory turns through changes to the existing purchasing software system
  
  
• Recommended the selection/implementation of a warehouse management system
  
  
• Implemented new slotting of all grocery products to improve picking efficiency
  
  
• Implemented a new facility configuration to handle new items and more storage capacity
  
  
• Changed order picking process from tuggers to double pallet jacks in a cross-aisle picking pattern to improve picking productivity
  
  
• Implemented a new plastic pallet system to reduce pallet repair costs.
  
  
• Implemented an automatic battery charging/mechanical changing system
  
  
• Changed overall delivery system improving driver and store unloading and stocking productivity.

Benefits

• Existing storage capacity was increased by 14% and capacity to handle new items increased by 26%
  
  
• Warehouse productivity increase of 17% through reduced travel time and improved pallet building
  
  
• Increased delivery frequencies provided for significant retail store back-room inventory reduction
  
  
• Improved store service levels through store-friendly pallets by family grouping and reduced top-loading
  
  
• Pallet repair costs were reduced by 70%