The New Balance distribution center, located in Lawrence, MS, is the hub of the company's operations. The previous distribution facility was an outdated mill divided into seven stories of 60,000 square feet per level. Product was spread over five different floors. A new distribution center was required, including a warehouse management system (WMS), that would address quick turnaround and have the ability to efficiently move products.
The results of the new facility, coupled with the integration of an entirely new equipment system, is a 40% increase in processed orders per day. During peak periods (April and July) New Balance processess as many as 4,100 orders, or 33,000 pairs of shoes per day. Quick response time is only 24 hours compared to a previous 72 hours. "We are extremely pleased with our new system," says Rick Thorn, systems engineer. "It has exceeded our expectations and has become a showcase for our commitment to customer service and efficiency."
"Our larger customers now require us to custom label and ship directly to their retail outlets, eliminating a costly step through their own distribution centers, " says Armand Teixeira, New Balance distribution manager. "Our automated system permits us to offer a level of service consistent with the high quality of our products and the New Balance image. It is without question a contributing factor to our competitive position in the marketplace."
The starting line at New Balance manufacturing sites, assigns an advance shipment notice (ASN) to each truck load. When the truck arrives at the distribution center's receiving dock, the ASN number is entered manually into the computer system. The WMS then indicates the expected contents of the truck load, thus receiving the truck's contents.
Master containers from the truck are placed onto a conveyor. Employees make sure that bar codes on each container face one direction so that they may be scanned by the receiving/shipping sorter. This sorter is equipped with a fixed position scanner. Stock-keeping unit (SKU), size, width, color, and other bar code data is relayed to the WMS after the container's bar code is scanned.
The receiving/shipping sorter groups together shoes by category. Category A representing high velocity items, descending to category D for low velocity items. After sortation, products are put away into storage. Full cases go to high bay storage racks, where New Balance can hold 1.8 million pairs of shoes. High-velocity split-case shoes go to the first level mezzanine on flow racks (122,000 pairs). Low-velocity split-case shoes go to the second level mezzanine on static shelving (107,000 pairs).
Radio frequency data communication (RFDC) terminals that allow for random put away in high bay storage and the distriuted SKUs in the high bay eliminate bottlenecks when picking. The bar codes on the cartons are scanned with an RFDC terminal located on the pick vehicles. Information is relayed to the WMS which assigns storage locations. A storage location is scanned and the carton is scanned. The WMS records this information, and from that point on, New Balance knows the exact location of each carton.
Customer orders are downloaded each day. Orders are received by electronic data interchange (EDI) or New Balance customer service sites. WMS batches orders together in waves. Each wave consists of approximately 200-300 orders, or 2,000-3,000 pairs of shoes. An employee builds the waves in the WMS, retrieving 24-hour orders first. Other orders are grouped together by customer and carrier. WMS releases the waves to the floor and picking begins.
RFDC terminals direct employees in all three storage areas as to which shoes to pick. The location and the shoe box are scanned and the quantity picked is entered into the terminal. When the last shoe of an order is picked from each of those three areas, the operator receives a directive to scan an empty end-of-wave tote which follows the wave. That tote is a signal to the conveyor system that the picking for that wave is complete. When the next wave is ready to be received, the light panel on the unit sorter signals when the end-of-wave tote is in place and the next wave is released.
UPC codes on the shoe boxes are scanned by a fixed-position scanner. The boxes are delivered to the 170 chute capacity tilt tray. Each chute represents a carton of an order. When the carton of an order is full, (no more than 12 pairs of shoes) the light at the end of the chute goes on. This light prompts employees to pack that carton in an appropriate box located behind packing operators. The operator then touches a button and the light goes out. The operator scans the chute and the carton ID. The chute is now clear and ready to receive another carton of an order to be prepared for packing.
Packed cartons are taken away on a conveyor, to return to the shipping/receiving sorter. The bar code is read, and the carton is diverted to the packing area. In the packing area, employees scan the carton ID. This information is relayed to the WMS which generates shipping instructions, labels, packing grids, and at the end of the order, the packing list for the last carton of the order.
If a box headed to shipping does not need special handling such as price ticketing, it is loaded onto the take away conveyor and expedited to shipping. If special handling is required, the box travels further down the conveyor. Customer reference files are downloaded from the WMS, and the boxes are price ticketed.
There's one more stop for boxes headed for shipping, the in-line scale. Boxes are weighed on the scale and the actual weight is compared to the estimated weight of the order for manifesting purposes. Boxes are scanned again and delivered to the ten shipping lanes. Packing lanes are set up by customer and sorted by LTL carrier or directly loaded to UPS or RPS.