Saar Lagertechnik Newsletter 01-2004

A Logistics Centre for Sport

Whenever companies invest in logistics, they have specific reasons and objectives. For the sports clothing company Jako it was permanent availability and short delivery times for their products. In order to reach these objectives a new warehouse was built – adding to an existing one – using the most up-to-date materials handling, storage and order-picking techniques known. The integration and partial remodelling of existing buildings was also important.
Jako. Once the name is explained to the interested outsider, one gets a first insight into the philosophy of the company that trades in sports clothing, sports articles (from footballs to goalkeepers' gloves) and accessories.
The name Jako incorporates team spirit and teamwork. The initial letters of the Jagst and the Kocher – two local rivers that run parallel to each other before simultaneously flowing into the river Neckar , thereby manifesting a kind of »team spirit« - stand symbolically for these characteristics. The company logo, which shows the course of the two rivers and their convergence, expresses the same symbolism. This idea

of teamwork also corresponds to the team spirit in competitive sport, where Jako's clientele are to be found. And to fulfil the wishes of their customers, in this case the sports shops, is the company's main concern.

     Sports shops can order through the company's sales representatives or by catalogue. The new logistics centre in Hollenbach ensures that the products are available and was built to optimise the servicing of the growing number of customers and handling of the ever increasing number of articles. The logistics centre has a storage area of over 7,000m² and holds more than 12,000 different articles with a 95% availability. Supported by the appropriate materials handling and storage techniques as well as an efficient order processing system, “We are in a position”, says Wolfgang Schalmbauer (Photo 1, on right), member of the Jako AG board of directors responsible for Purchasing and Logistics, “to supply any article required within two days of order”.
     Every day around 1,000 consignments - and as many as 1,800 in the peak season – leave the logistics centre at Mulfingen/Hollenbach that has now been operating for a good year in its present form.

The new logistics centre
     With the support of the new logistics centre, Jako have been able once again to shorten the time between receipt of order and despatch, thereby dramatically improving delivery times and reliability. In addition, if a customer orders, for example, ten T-shirts in various sizes for one club, 30 tracksuits also in differing sizes for another and perhaps balls and goalkeepers' gloves, he naturally wants all the articles to come together in one consignment. »That too was a requirement that we have been able to satisfy with the new logistics centre«, says Schmalzbauer.
     One set of customers that the company especially enjoys serving, is internally called the »Champions League«. This designation, which is the name of the cup the best European football teams compete for, stands for Jako's top 250 top clients; the »Champions«. Schmalzbauer says, »These customers are guaranteed a maximum delivery time of 48 hours from receipt of order to delivery«.

1: That team spirit can also be the recipe for the successful completion of logistic projects was impressively proved by the member of the Jako board of directors responsible for Purchasing and Logistics, Wolfgang Schmalzbauer, on the right in the photo, and Albrecht Erbach-Stanzione, Managing Director of Saar Lagertechnik GmbH.

     This promise matches up with the company's own expectation that the articles ordered pass through the logistics centre inside a maximum of 24 hours in order to be ready for despatch. Despatch on the same day as the order is also possible.
     Albrecht Erbach-Stanzione (Photo 1, on the left) Managing Director of Saar Lagertechnik GmbH, the supplier of the internal logistics and the main contractor for the »Logistics Centre« project, sums up this expectation was turned into fact: »Together with the Engineering Consults Keller Logistic and the person responsible from Jako, we worked as a team to create a logistics centre that, thanks to its materials handling equipment, storage systems, mobile storage installation and order-processing techniques and not forgetting the stock control methods, make it possible for Jako to keep their delivery promises and maintain guaranteed quality not only to the »Champions League« but also to the normal customers.
     The new building is just one section of the new logistics centre, in addition there is an existing mobile racking installation and a 3-tier storage platform made of longspan racking used for order-picking, both designed and installed by Saar Lagerrechnik in 1997.
     In the new section of the logistics centre there is a mobile pallet rack (Photo 2) with storage space for 33,120 cartons or 2,300 pallet positions plus a downstream order-picking installation with all the necessary handling equipment.

Creation of a single unit
One special requirement imposed on the supplier, Saar Lagertechnik, was that the existing warehouse and the despatch department should be combined with the new logistics centre and its activities in such a way that all the systems involved in the in-house logistics should work together efficiently. At the same time the flexibility and efficiency needed by the customer must also be assured. For Erbach-Stanzione that was »the

2: The mobile pallet rack is used as an intermediate storage zone for the downstream order-picking area, visible in the background.

merit of the entire team, consisting of the people responsible for the architecture, for the logistics, for the customer and for us on the technical side«.
The result was a logistics centre with a mobile pallet racking unit. This unit is used as an intermediate storage zone for the downstream order-picking area. Forklift trucks take the pallets out of the mobile pallet rack. The individual cartons are removed from the pallets and then taken to the order-picking department.
This storage platform (Photo 3) has three order-picking levels, the highest of which is 5.10 meters high and the lowest at floor level. A goods lift operates between the three levels and, together with a conveyor system, ensures smooth rotation in the order-processing department. This makes certain that an order passes through the order picking area in the new logistics centre as well as in the old storage area (Photo 4). Schmalzbauer: »For us that was also an important aspect during the planning stage, as all the articles in our football catalogue are stocked in the existing warehouse and we in the new logistics centre hold the articles from the fashion catalogue. For a customer, who orders from both catalogues, we effect a fast despatch thanks to the efficiently operating order processing system.«

3: The goods lift integrated into the order-picking storage platform supplies the various floor levels and ensures the continuity from the new logistics centre to the despatch department via the existing storage racking.

Dividing the order-picking sections into different zones emphasizes the aims once more: every order starts in the zone in which the articles ordered are stored and doesn't have to go through the whole order-picking department. This means that the articles ordered are placed in cartons in the order-picking department based on the orders received, the information necessary for the employee being generated by the warehouse management system. To this end the carton is placed on a conveyor on which it passes through the various order-picking zones. During this journey a scanner ascertains whether the carton should stop in the next zone so that goods can be added. If this is the case, the carton is automatically pushed out for further articles to be added. Once the new goods have been packed the carton travels back to the despatch area in the logistics centre.
The pivot point of the order-processing department is the mobile pallet racking referred to earlier.

The points in favour of a mobile pallet rack
     The company decided on mobile pallet racking because it has a string of specific features that were predestined for the intended operation. Schmalzbauer: »We wanted to be able to react to our customers' requirements flexibly at any given time. For that reason mobile pallet racking ideally suited the concept of the logistics centre, where we purposely kept automation to a level that was not too high but acceptable to us«.
     Mobile pallet racking offers a series of features that convinced Jako. For Erbach-Stanzione one of these was »Naturally the ability to store in very compactly, enabling enormous quantities of goods to be stored in a small area and to take maximum advantage of the available height of the building. That made the mobile pallet rack not only economic but also efficient.«
    But modern drive and controlling techniques also played a part. These, for example, make it possible to open the gangway needed quickly, allowing the forklift trucks to reach the pallets without delay.

4: from the goods lift the goods are taken to the existing warehouse by the conveyor system

     The forklift trucks are connected to the warehouse management system's software by radio and are thus guided optimally to the right gangway and the correct pallet. In addition a mobile pallet rack allows the fifo principle to be put into practice without any trouble.
     On the whole it can be said that by incorporating the mobile pallet racking in Jako's logistics centre, all the features offered by this type of storage could be exploited to full advantage making it a perfect a stock buffer for the downstream sections of the order processing department.

Summary
     The task of creating a logistics centre to satisfy all the special requirements of Jako, was resolved by the Keller Logistic Consulting and Planning Company, the main contractor for the in-house logistics, Saar Lagertechnik, and the management from Jako.
    One of Jako's objectives was, for example, to have the highest possible availability for their goods and to be able to deliver at any time. That again was intertwined with a special kind of organisation and order processing structure. Schmalzbauer: »It was our aim that a customer who orders from the fashion and football catalogues could, depending on the size of the order, receive his goods in one package or in one consignment«.
     To combine an existing warehouse with the new logistics centre in such a way that would ensure a continuous flow through the order-processing department, therefore became Saar Lagertechnik's objective as well.
     Through the overall concept of the logistics centre, Jako have not only achieved these objectives, while enjoying the advantages of using a mobile pallet rack, but has also increased flexibility and order processing throughput by 20%. »A team, that worked together well and harmoniously, has on the one hand created an installation that has mastered the current storage situation in the best possible way and on the other hand is so structured that Jako's future plans can be realised without any difficulty«.
     There is – looking to the company's future – enough land available to construct another warehouse mirroring this one.