EXEL: VISIONARY PICKING
At third-party logistics services company (3PL) Exel, the desire for speed might point to a new generation of wearable warehouse technology.
In 2015, Exel’s parent company, DHL, conducted a test of “vision picking” at a DC in the Netherlands, which DHL operates for Ricoh Company. DHL tested two kinds of “smart glass” devices, Google Glass and M100 Smart Glasses from Vuzix Corporation of Rochester, N.Y. Software from German company Ubimax turned the glasses into front-end devices for a WMS.
The technology boosted productivity in the DC by 25 percent during the pilot, according to DHL. Now, Exel plans to test the same devices in the United States in late 2015 or early 2016.
“We see this technology combining the best attributes of various picking types,” says Adrian Kumar, vice president of solutions design at Exel in Westerville, Ohio. Handheld computers with radio frequency communications provide barcode scanning and real-time communications; voice-directed systems allow hands-free interaction; and light-based systems highlight the location from which the operator should make the next pick. A vision picking system potentially can do all three.
Vision picking also has a short learning curve,” Kumar says. “That’s important, because we use a lot of seasonal associates.
Besides helping temporary workers learn their jobs more quickly, vision picking might give detailed instructions to associates who work on value-added services, such as kitting.
A series of kits might contain similar products, but some of them could—for example—contain just four items, while others have 10. “Can vision picking let associates see the step-by-step instructions to complete a kit with high quality and greater efficiency, and be able to more quickly change the type of kit they’re doing?” asks Daryl Knight, Exel’s vice president, customer development, technology, and aerospace logistics services. That’s one question the tests will address.
Along with basic display and barcode scanning functions, a vision picking system could incorporate more advanced features, such as virtual pick-to-light, or a navigation system that guides workers efficiently among the aisles. “We are considering a spectrum of options,” Kumar says.
During the tests, Exel will measure how vision picking affects overall picking performance and accuracy. A longer-term consideration is whether smart glass could provide an alternative to the use of capital-intensive materials handling automation in some facilities. “Maybe warehouses won’t need a lot of conveyance, because the pickers can be extra productive,” Kumar says. “When they get their assignments, they can pick 10 to 12 orders at a time.”
DARK STORES COME TO LIGHT
Among e-commerce merchants, customer demand for fast fulfillment is driving a move toward urban warehouses. By storing product in densely populated locations, companies make next- or even same-day delivery simpler and less expensive.
For some omni-channel retailers, the urban DC strategy includes the use of “dark stores,” which usually refers to a retail outlet that has shut down, and that a company—either the owner of the store or a different firm—converts to a DC.
Because e-commerce fulfillment largely involves piece picking, a company that turns its own store into a fulfillment center might be able to repurpose the existing retail shelves. If the building has a high ceiling, the retailer might install tall racking to make better use of the space. “But, particularly if fewer than a couple of years are left on the lease, the company will use as much of the existing infrastructure as possible,” says Bob Silverman, executive vice president, supply chain and logistics solutions, at Chicago-based real estate company Jones Lang LaSalle (JLL).
More recently, some observers have applied the term “dark store” to a second scenario, in which a brick-and-mortar urban facility serves a dual purpose. By day, shoppers walk the aisles, choosing products to take home. At night, pickers walk those same aisles filling e-commerce orders.
A retailer might deploy this solution to take better advantage of an underperforming store that still has several years left on its lease. This strategy also solves a space problem for retailers that want to speed up e-commerce fulfillment by shipping product from stores to local customers. Shipping from the store during business hours can be difficult. “There’s just not the space and layout to allow fulfillment of those e-commerce orders,” Silverman says. “Back rooms are small, because retailers are trying to maximize selling space.”
Because retail space costs four to five times more per square foot than warehouse space, the decision to convert a store to a DC is far from a no-brainer. The fact that companies are willing to spend the extra money demonstrates how crucial fast fulfillment has become. “The real estate cost is minimal in the total picture, compared with the opportunity cost of getting the business, and the transportation cost for shipping product from farther away,” notes Silverman.
Whether the key lies in location, automation, smart spectacles, or smart routing, shippers will continue to refine their strategies for getting goods to customers faster than ever.