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Future Electronics is picking in the distribution centre EMEA DC Leipzig with Witron-OPS

Future oriented Logistics at FUTURE Electronics

Since the early 2010, the Canadian electronic distributor Future Electronics has been supplying electronics components to customers throughout Europe, the Middle East and Africa via their new distribution centre in Leipzig. The Parkstein systems integrator Witron Logistics + Informatik GmbH was the general contractor responsible for design and implementation of the facility. Witron had successfully designed and implemented an automated distribution centre in Memphis for Future Electronics in 2004.

“The EMEA DC (Europe, Middle East, Africa Distribution Centre) in Leipzig is the logistics core of our next day delivery service in Europe, the Middle East and Africa“, said Reinhard Holland-Cunz, director of transition and jointly responsible for the start-up of Future Electronics in Leipzig. “This facility also allows us to manage, upon request, the complete warehousing for our customers and offer lots of value-added services”, as Holland-Cunz proudly listed additional competitive advantages of the showcase distribution centre in the German State of Saxony.

The fully automated central warehouse was built as a greenfield solution, based exactly on the model of the existing distribution centre in Memphis, Tennessee, and equipped with state-of-the-art logistics, control and software components. In 2002, Witron Logistics + Informatik GmbH, then still relatively unknown in the US, had prevailed in Memphis, thanks to having the best concept, over various competitors and won the confidence of Future Electronics. As one of three global logistics centers of the Canadian electronics distributor, it plays an important role in the strategic planning of the company. “The Leipzig warehouse enables us to even supply our US customers on short notice if there should be any shortfalls there”, said Holland-Cunz.

 

The Leipzig location as a link between Western and Eastern Europe

“This establishment of Future Electronics further cements the importance of the location as an international logistics hub”, said Burkhard Jung, Lord Mayor of Leipzig, during the groundbreaking ceremony for the new distribution centre in July of 2008. “It furnishes new proof that logistics are among the most important future business sectors of Leipzig, with a tremendous potential to create many jobs in the region.”  Here the explicit goal of Future Electronics was, as it had already been in Memphis, to create within a minimum of time, a distribution centre which does not only fully meet the functional requirements but also perfectly reflects, both internally and externally, the corporate identity of Future Electronics. This could only be achieved by close cooperation between Future Electronics and Witron. “As before with the project in the US, Future and Witron have again taken the same route from the very beginning”, said Reinhard Holland-Cunz. “The Memphis facility is known in the industry as a masterpiece in terms of efficiency, quality and return-on-investment. This is the goal we share in Leipzig, too.”

For Future Electronics, the distribution centre in Leipzig is the successor to the manually operated central warehouse in Hayes, England. The logistics centre in Britain was not designed for further growth. “The decisive factor in favor of Leipzig, apart from the advantageous building and investment costs, was its central location between our already existing customer base and future growth markets”, Holland-Cunz stated. “The long-term guaranteed connection to DHL’s Europe Hub in Leipzig for air cargo and the other modes of transportation available, tipped the scales in favor of this location.” He also reports that the availability of a young qualified workforce as well as, deliberately, employees aged 55 and older had played an important role in making the choice: “Due to our product range, we must attach utter importance to care and diligence – virtues in which senior employees in particular generally excel”, Holland-Cunz explained. “Thanks to the ergonomic workplaces of the OPS (Order Picking System), such experienced employees are optimally integrated into the workflow. Generally we can say that support by automation has significantly increased the quality of picking, the performance of delivery and the complete transparency of the processes in comparison to a manual solution.”

 

Tried and tested solutions of crucial importance

The Leipzig distribution centre, with its 15,000 square meters of warehouse space, now supplies, among other things, semiconductors, passive connection components, LCD displays, wireless transmission media, RFID solution modules and a wide variety of other components to customers in the electronics industry throughout EMEA. The product range also consists of components as small as 1 mm in size. “The scope of logistics services provided by Witron consists of design and detailed planning, along with  delivery, installation and commissioning of all mechanical warehousing and transportation systems”, Witron’s project manager Hans Schütz explained: “This includes all required IT systems, the warehousing software, programmable logic controls, networks and peripherals.” Due to the criticality of the product and customer range, the facility has high availability, which can be used 24 hours a day, 365 days a year if required, a powerful warehousing system is of pivotal importance. “In Leipzig, as in the first project in Memphis, Future uses our Witron-WMS. This comprises many industry-specific features in addition to a wide range of base functions. To this end, a uniform feature pack, the same both for the Memphis and Leipzig locations, has been developed which fully meets the requirements of Future Electronics and in the future, will be used at other locations of the company as well. Currently the WMS supports the intense communication with Future’s proprietary systems, thereby ensuring world-wide transparency”, Schütz continued to explain.

“The implementation of redundant systems, both on the level of transportation technology and in the IT sector, also had high priority for Future”, said Schütz. In addition, all installations had to be built to comply with the applicable ESD “ Electrostatic Discharge” protection regulations, since in Leipzig some very sensitive electronic components were going to be stored. ESD protection saves components from being destroyed by such ESDs. Apart from suitable totes, Witron uses workbenches specifically designed for Future Electronics, which meet these high requirements. Suitable floors, air-conditioning, moisture control and very high cleanliness in the facility are required in this context.

 

OPS tote solution for a wide spectrum of products

At the Leipzig location, as in the previous project in Memphis, Future uses the advantages of the standardized and modular tote picking system “OPS” (Order Picking System) by Witron, as this solution is ideal for the handling ofan assortment ofproduct ranges. At 20 stations, the articles are delivered, picked and then packed into the shipping box sequentially for each order according to the goods-to-man principle. The OPS shifts the matching of the orders directly to the picking stations which can be manned individually and flexibly according to the requirements. The OPS integrates storage and picking into one system and has already provided extreme cost-savings and increased efficiencies in many applications for the automatic handling of broad ranges of products all over the world.

“The ergonomically designed picking stations with the quality control and packing stations directly downstream result in error rates  at nearly zero and high picking performance of the employees“, Witron’s project manager Schütz explained. “Moreover, special requests by Future’s customers such as labeling and special packaging can be processed flexibly at the picking and packing stations. Furthermore, using the OPS allows post-processing or custom-packaging the picked goods without issues in an integrated system. Dispatch management down to the technology for sorting the packages for the individual external service provider is likewise supported by the OPS and fully integrated into the overall workflow.

“In contrast to the operation in a manual warehouse, the pickers and packers automatically receive the articles and all information necessary for each individual or consolidated order from the system. The system is the optimal service provider for our employees”, said Future’s director Reinhard Holland-Cunz.

 

Productive operations two months earlier than planned

In the ten-aisle automatic small components warehouse AS/RS (Automated Storage and Retrieval System) with a total of 285,000 tote storage locations and a two-aisle AS/RS high-bay rack with 4,500 pallet storage locations, Future Electronics will be able to store some 100,000 different articles of SKU’s.  Despite a plethora of very small-volume articles, efficient and space-saving storage is possible based on a double deep configuration.. Every day some 4,200 packages can leave the distribution centre – corresponding to a picking performance of over 18,000 picks per day. The whole facility is designed for the increases in volume expected for the next five years. In all, Future Electronics has invested over 40 mio. € into the Leipzig location, with the portion for the equipment and services provided by Witron amounting to over 20 mio. €.

In addition to extensive tests and simulations, the Canadian electronic distributor sent their Leipzig employees to the US for several weeks to watch and learn in Memphis the workflows planned for the new distribution centre. “Thus during start-up we had no unpleasant surprises”, said Reinhard Holland-Cunz, who had already been involved in the launch of the Witron warehouse in Memphis in 2004. “Our customers did not notice anything when we moved the warehouse from England to Leipzig. Even at our headquarters in Canada, some people would ask when the move was finally going to take place – at a time when moving was almost finished.”

As a result, the Leipzig facility could be used two months earlier than initially planned.

 

System integration of the China distribution centre also possible conceivable

Since the completion of the start-up phase in summer 2010, Future Electronics has been extremely satisfied with the performance of Witron’s OPS. “We are able to serve our customers significantly faster”, said Holland-Cunz. “Express deliveries within four hours do not pose any difficulties these days.” During the first months, the number of picks per employee has already markedly increased in relation to the previously operated manual warehouse in Hayes, England, and error rates have been markedly reduced. Moreover, Future Electronics was able to cut back the number of employees in warehouse and picking, which naturally contributes to a much more efficient overall cost structure.

 

The positive experiences in Memphis and Leipzig have motivated Future Electronics to ask Witron to bid for a WMS for the planned distribution centre in China.  Future Electronics is considering using the same system at all their locations as another competitive advantage in international business. “Both for us and for our customers, a globally networked supply chain management with integration of procurement and warehousing is of crucial importance”, Holland-Cunz explained. “Our goal is that supply to individual regions can be managed with complete flexibility – in a manner of speaking, ‘ship from everywhere to everywhere’”.

 

Thomas Wöhrle, journalist, Karlsruhe.