Lean gravity warehouses for intralogistics

• Lean solutions for intralogistics
• FEFO – LIFO
• How to design Lean gravity warehouses
• Person-to-goods
• The Milk Run in intralogistics

Lean solutions for intralogistics

Intralogistics or internal logistics deals, on the one hand, with material flows and inventory management, which means, from a lean perspective, how materials are handled, and, on the other hand, with coordinating information.

Lean gravity warehouses, also known as supermarkets, SAGs, gravity racking with roller conveyors, FIFO dynamic racking or flow racks, are Lean equipment that supports production and intralogistics processes, facilitating material handling, storage and picking operations.

Lean gravity warehouses, as the name suggests, are systems equipped with inclined roller shelves, on which boxes, cartons or loose parts slide using gravity. Materials are supplied to production lines and assembly stations using the FIFO (First In, First Out) logic, according to which the first goods to enter are also the first to leave.

To better understand the benefits of using FIFO dynamic shelving, let's first look at how it is designed.

FEFO (First Expired, First Out) – LIFO (Last In, First Out)
The FEFO method is mainly used for managing products with expiry dates, such as food or medicines. It requires that products with the nearest expiry date be used or sold first, in order to ensure maximum product safety and quality. This method reduces the risk of waste due to expired products and helps to ensure regulatory compliance and customer satisfaction.
The LIFO method requires that the most recent products be used or sold before older products. This method is often used for inventory management in situations where more recently purchased products have a higher market value than those purchased earlier. It is important to note that using the LIFO method can have tax implications, as products sold are valued at a more recent cost, affecting the calculation of profits and taxes.

How to design Lean gravity warehouses

The first factor to consider when designing gravity-fed warehouses is related to the product to be handled: weight, dimensions and quantity. How is it handled? Is it placed inside containers, boxes or directly on roller conveyors?

The number of picking shelves and return shelves for empties is then determined, sizing each shelf according to the maximum permitted load and taking into account ergonomic principles in terms of shelf height. In particular, for the vertical organisation of work equipment, during the design phase it is essential to ensure compliance with the strike zone (height between 600 mm and 1500 mm) and the strike point, given by the specific area located between the elbows and shoulders, where picking activities can be performed optimally.

Flow racks, SAGs, or Lean gravity storage systems are the equipment that best represents the principles of Lean Production. These solutions are based on the principle of goods-to-person picking.

The products to be assembled are brought to the workstation and made available to the assembly operator in predetermined quantities, thus avoiding the need for the operator to move around the warehouse to collect the various items to be picked (see person-to-goods). This eliminates unnecessary movements and reduces the transport of materials, all activities that are part of waste or Muda, which Lean aims to eliminate, as it is an activity that does not add value.

PERSON-TO-GOODS

Operator movements
Operators must follow the picking routes to collect the products assigned to the order.
Productivity
The efficiency of manual order preparation depends on the implementation of warehouse management software that determines the best routes.
Operating costs
Costs may vary depending on order volumes at different times of the year. Nevertheless, errors caused by manual preparation result in significant additional costs for the company.

The use of supermarkets (or gravity racking with roller conveyors) on the production line is even more efficient and simplified when the management of component flows, both by line operators and by operators who supply the line or workstations from the central warehouse, is carried out using Kanban cards. The Kanban method Its operation is based on the use of cards containing the information necessary to produce or move components within the production system according to a continuous flow. The information generally shown on the Kaban card is:

• the component code
• the component supplier
• the weight of the component
• the quantity present in the container
• the autonomy of the container
• the quantity of containers present in the gravity warehouse
• the reorder point
  

Among the many advantages of the Kanban system, one that stands out is a reduction of up to 90% in inventory, which we know to be a waste of both space and financial resources in Lean Production. The Kanban method is one of the Lean techniques that forms the basis of pull method, i.e. production driven by customer demand. Thanks to Kanban, it is possible to plan production in such a way as to manage and control the material supply process. The Kanban system is driven by consumption, which allows for self-regulation of the material procurement process between the warehouse and the production department. The goal is always the same: to reduce waste (Muda) and optimise processes.

The Milk Run in intralogistics

In intralogistics, the supply of materials and stocks between the warehouse and the production lines or workstations is based on the Milk Run principle, which literally means “milk run”.

The concept of the Milk Run comes from the USA and is based on the supply of milk to American citizens in the last century. Due to the short shelf life of milk, the milkman's van would pass by every morning and collect the empty bottles, leaving the full ones. The number of empty bottles left outside the door was a visual indicator of the amount of milk consumed that needed to be replenished.

The Milk Run is a valuable support for the SMED, where efficiency requires having what is needed where it is needed. To transform an intralogistics process into a Milk Run system, material handling must be planned and carried out on a regular basis. The Milk Run originates in the warehouse and moves along a fixed route with multiple stops, where the Water Spider (or Mizusumashi in Japanese) who is the operator-servant responsible for supplying materials, replaces empty containers with full ones and finally returns to the starting point.

The main difference between Milk Run and other procurement systems lies in the small quantities delivered, only what is needed for the specific activity, limiting waste, unnecessary stock and downtime. If consumption is higher, the system will pull more; if lower, it will pull less.

The advantages of intralogistics management according to the Milk Run system are a reduction in management and space costs and the elimination of forklift trucks from production lines or workstations.

For internal logistics, you can use logistics trains, in which the Mizusumashi pulls a series of trolleys using a tow bar. Tractors generally pull:

• trolleys with shelves for handling small containers
• trolley with platform for transporting entire pallets
• dolly trolleys for moving small boxes

Automatic guided vehicles (AGVs) can also be used, which are capable of delivering materials without drivers, but then an operator or a Karakuri system.

The latter exploits elastic force and gravitational force combined with the principles of leverage to create simple, low-cost automation mechanisms (LCA Low Cost Automation). Thanks to Karakuri systems, loads can be moved and materials oriented, resulting in improved workplace ergonomics.

The Milk Run must have easy access to the central warehouse so that the material is readily available and managed, usually in gravity warehouses using FIFO logic or, in the case of larger quantities, stored on the floor on pallets with clear identification of the components.

In addition to using the Kanban system, characterised as previously explained by a label containing the materials and quantities required, you can adopt the kitting strategy, which allows you to group the individual parts needed to assemble a product into a set, creating a package called a kit.

The kit is delivered to the assembly stations where the finished product is manufactured. The advantage of the kit is maximum flexibility in supplying customised parts as required for assembly, thereby completely eliminating in-line stock. The kitting strategy is only advantageous if there are zero picking errors. Systems such as Pick to Light, which are part of the systems, come to the rescue. Poka Yoke. Once the required kit has been identified, Pick to Light is able to indicate the components to be picked in sequence, specifying the quantity. Companies that implement the kitting strategy, specialising their employees in the preparation of sets, achieve the best product manufacturing times and greater efficiency in assembly operations.

The ideal workstation is therefore one equipped with one or more gravity-fed storage systems with sliding lanes or chutes for FIFO management of parts, both for material handling (loaded by the Water Spider from the rear) and for the return of empty containers, which are positioned manually by the operator and collected by the handling operator.

To correctly size a Milk Run system, the following must be identified:

• space at the workstation
• the frequency of passage
• the necessary materials
• the capacity of the train
• the layout
  

With regard to the space available at the workstation, the aim of the Milk Run is to save space. However, there must always be at least one box at the workstation at all times. When a container is emptied, the Milk Run collects it on the first round and returns it full on the next round. If the container is emptied shortly after the Milk Run has passed, it is necessary to wait for another cycle for replenishment.

Ideally, therefore, to avoid stockpiling or waiting for supplies, it is advisable to have space at the workstation for two Milk Run cycles and an extra box. This extra box acts as a safety buffer for fluctuations in consumption rates during assembly. During normal operation, half of the materials (plus the safety buffer) are located at the assembly station, while the rest are on the Milk Run and in the warehouse. To determine the material needed to cover two cycle times, it is necessary to determine all the materials required for assembly, identify the consumption rate and the load units.

Let us assume, for example, that we need one piece every sixty seconds (Consumption Takt). If the Load Unit (UDC) is 10 pieces, one container will be sufficient for ten minutes. Therefore, if the cycle time is one hour, we will need 6 containers plus 1 (for a total of seven containers). The following calculation must be performed:

The calculation must be repeated for all materials to be procured with the Milk Run. The next step is to size the train according to the formula:

When planning the layout, the first step is to identify the stops and the relevant stations to be served. Next, a list of stops where the Milk Run should deliver the material is generated, indicating the materials to be served. The route is then determined by connecting all the previously established stops. The time required to complete the route must also be considered, which must be less than the cycle time used in the calculations with a safety buffer in the planning.