Warehouse Design – Key Factors to Consider and The 7 Principles of Warehouse and Distribution Centre Design

Four factors should be considered when designing or laying out any storage or distribution facility. Be it a large multi temperatured composite distribution centre servicing a high market network, a spare parts store in mobile service centre, or raw materials store supporting a manufacturing operation.

The four basic factors can be easily remembered using the pneumonic FAST or fast standing for:

? F-Flow

? A-Accessibility

? S-space

? T- Throughput

These are not in any order of priority. Each is as important as the other and your aim is to obtain the best compromise of these often conflicting influences. As one factor is considered and altered, each of the other should be revisited to see what is the impact of that change on the whole process.

1. Flow- What we’re looking for here is a logical sequence of operations within the warehouse where each activities located as close as possible to that which precedes it and also the function that follows it. We are concerned with the controlled and uninterrupted movement of materials, people and traffic with, if possible, no cross flow clashes or areas of high traffic or work density. It is also concerned with the awareness of where material is located within the system, and the status and location in the storage and handling equipment and medium. Our aim is to site and position the various warehouse activities in order to contribute to a smooth flow of operations with a minimum amount of movement and disruption.

2. Accessibility – We are not only talking about whether or not we can get to the product. But can we get to the required level of pack? Take the example of bottled water for instance, from major FMC distribution centre we’ll be looking at being able to receive and issue product by the pallet load possibly even by the truck load. So you only need to access full pallets and since it is very fast moving with a fairly long shelf life, strict first in first out by row to individual pallet level need not be followed. At the wholesaler or distributor level, you might be accessing down to case level and then in the convenience store stock room individual bottles. It can go further than this. For pharmaceuticals, accessibility may need to beyond individual item level down to specific lock and batch number. The requirements of levels of accessibility must be achieved especially in the pick base and fast moving stock holding areas with a minimum compromise to the next factor, which is the use of space.

3. Space – When considering how to use the available space, the maximum should be allocated to operational storage and stock processing purposes. And the minimum space given up for associated functions such as offices, working areas, empty pallets storage, battery charging, etc. Today’s wide range of storage media available on the market allows us to make optimum use of a cubic capacity of the available space, not just the floor area. As most of this equipment is free-standing and requires no structural support from the building itself, it means that the building can be of the simplest and cheapest big box design. It also allows us to build in flexibility to the operation by selecting the storage media to meet the current stock profile and then change it as the operation evolves to meet future requirements. This can be done without expensive and disruptive changes to the actual building. But remember, you still have to consider flow accessibility and now finally:

4. Throughput – When we look at throughput, where not only looking at the categories of product parting through the warehouse but also the nature of the product and its velocity through the flow. By nature, we mean the handling characteristics, dimensions and any other factors that will impact on how it is moved through the flow such as hazard, bulk, fragility, security requirements and compatibility with other products. The velocity of the product will consider the volumes moving through the warehouse on a daily basis. Pick period activities need to be determined as do minimum activity levels. A high degree of availability of accurate throughput data will assist greatly in the outcome of the design or layout exercise. The better the data and the longest spent on collecting and analysing it, the less the risk, however it is still possible to come up with an acceptable solution when one does not have the luxury of accurate data going back into history. You have to do the best with what is available.

The 7 Principles of Warehouse and Distribution Centre Design

1. Determine the objective of the facility

The first step must involve defining the objectives and goals of the facility. What is it there for, what market does it service, is it part of a network, what types of goods will be stored, what is the anticipated life of the facility, will it be a greenfields site, or an existing facility?

To press the point, it is useful to write the objectives down so that all associated parties remain cognisant of the expected outcome – especially if timing, budget or resource issues during the project life tempt stakeholders to compromise operational or design goals.

2. Define volumes and functional requirements

The famous British Physician Dr Thomas Fuller once said: “Get the facts, or the facts will get you. And when you get them, get them right, or they will get you wrong”. This is an important lesson that was also affirmed by my learned web colleagues, and certainly one that has guided my own work throughout my career. Quite simply, the facts needed are:

1. Quantities of products to be stored.
2. The throughput velocities, including incoming goods, customer orders, interfacility transfers, dispatches and returns.
3. The nature of orders and specific picking requirements, e.g. is picking performed in containers, pallets, cartons, inners, or single units? 
4. Now if you are thinking that this is easy, think again. This is one of the hardest and most time-consuming components of a design project.Why? Rarely do enterprises have such data readily available. Designers must therefore ‘mine’ it from the enterprise as best they can. In cases where data is piecemeal or non existent, the designer must draw from his/her own experience to fix assumptions around volumetric estimates. This can be particularly challenging when heavy scrutiny is placed upon the designer to prove the concept, and is best performed with collaboration and agreement from the stakeholders involved.
5. What functions need to be provided for?

It’s imperative that the designer understands all of the functions that are to be included on the site footprint, e.g. warehouse, offices, gantry cranes, loading docks, forklift charging areas, dangerous or hazardous goods, cool or cold rooms, clean rooms, manufacturing or packaging operations, staff facilities, etc. Equally important is that relative dependencies between functions are determined so that the designer can correctly frame functional proximities for best flow and operation by staff.

3. Match storage modes, it systems and mechanised technologies with volumes

Once the data has been analysed, the designer is ready for equipment selection. Be it static racking equipment, mezzanines and the like, or mechanical equipment such as conveyors, carousels, stacker cranes etc., all equipment and systems must be applied according to their purpose, limitations and fit with the volumes handled.

For instance, it is a waste if an automatic storage and retrieval system is installed, when a conventional racking system will suffice. Conversely, if the facts point to justification of a high-velocity automated system, it is foolish to ignore them for the sake of a more conventional system. A critical aspect of equipment selection is that the designer has expert knowledge of available equipment and technologies, and how to apply them.

This is a complex area that deserves careful consideration and the novice designer is well advised to seek advice from materials handling equipment and software suppliers, builders, and industry specialists to ensure that their design is well founded, robust and practical.

4. Flow

This aspect incited some interesting comments from my web conference colleagues. From their wise counsel and my own experience, I suggest that the skilful designers apply two immutable laws of flow.

1. One-way flow.
2. The best warehouse operations are those that apply this principle. Whether straight, clockwise, counter clockwise, up or down, make sure it flows in a one-way direction. But here’s a tip. Be cautious when dealing with international customers, where cultural and religious beliefs point to specific requirements. An interesting challenge that I experienced on a recent project was the Hindu philosophy of Vaastu Shastra.
3. The customer politely indicated that the warehouse flow should be clockwise, heavy goods should be stored in the south west, with lighter product in the north east. The front door and offices should face east with entry to the site from the north. Needless to say, this provided an intriguing set of constraints that I happily applied to the design of both site and building. The key point here is that despite restraints, the designer should always err to the one-way flow principle.
4. Flow vs. Capacity.
5. The second rule of flow is that free movement has priority over storage capacity. If you are pressed with a choice, the pundits agree that it’s better to hold flow sacrosanct, compared with building more stock or storage equipment. Why? Long after the warehouse construction has been completed, a team has to operate efficiently and safely in the warehouse year after year. If the design compromises on the size and quantity of aisles, for sake of more stock holding, beware: this can cause suboptimal performance over the life of the facility.

5. Close to zero materials handling movements

A simple rule that says it all: keep the product handling by people to a minimum. Ideally from 3-5 touches of the product, while goods are the in the warehouse. Sadly, I have witnessed operations that handle goods up to 8 to 10 times. Normally there is severe design or building constraints applicable to such situations. But the outcome is evident in the maxim: ‘more touches, more cost’. Take note!

6. Evaluate your options

The developed concept design options must be evaluated to ensure that the objectives are achieved. The two common approaches to assessment are:

1. Quantitative analysis: return investment, payback, cost per order to supply, cost per order cubic metre to name just a few.
2. Qualitative analysis: reviewing the advantages and disadvantages of options considered. Ideally the evaluation is best performed both individually and in a team workshop environment. It’s amazing what can be revealed when a team collectively focuses its attention at a project. Despite the meticulous job the designer may have performed, a workshop can often reveal a late insight, idea, or missed detail that can significantly impact upon the end design.

7. Consult widely as the design process is multifaceted, and normally involves executives, managers, and operators – not to mention equipment suppliers, builders, architects, and councils.

As part of the development process all should be regularly consulted as to planning and legal requirements, operational needs, preferences, ideas and opinions.

No one party has all the background and knowledge to implement a DC project. The best implementations typically features a cohesive and dedicated team charged with managing the project from early design phases through to completion.

Credits : Author - Rob O'Byrne 

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