“We are all about delivery, not storage”
The new logistics centre at Albert Berner Deutschland GmbH in Künzelsau, Germany, enabled a significant expansion of the warehousing and picking capacities in the central warehouse of this German distribution company within the Berner Group. The tote picking system DPS, supplied by general contractor Witron Logistik + Informatik GmbH from Parkstein in Germany, optimises logistics processes and contributes to a sustainable improvement in service in an extremely competitive market environment.
The combined Berner Group is one of Europe’s leading direct sellers, offering an all-around service in the small components business to professionals in the building construction and automotive sectors, as well as other industries. An efficient international supply chain plays a crucial role in the sustainable success of the company. By expanding the warehousing and picking capacities at the Künzelsau site, Berner laid the foundations for highly efficient logistics. The centrepiece is Witron’s “Dynamic Picking System” (DPS), which combines all the warehousing and picking functionalities in one modular and integrated system solution.
Throughput increased by 80% – error rate and costs minimized
Berner invested around eleven million euros in upgrading its logistics. Some 8.5 million of this went on WITRON’s services. Almost all 25,000 Berner articles are stored in the logistics centre in Künzelsau; around 1,000 suppliers are linked into the logistics system. All the A articles and some of the B articles, i.e. roughly 6,500 different products in total, are picked from the DPS directly into shipping cartons; the replenishment process is fully automated. This solution has enabled an 80% increase in throughput over its predecessor in the Berner logistics centre, the error rate in relation to all deliveries has dropped to a rate of 0.04 percent and the shift system has been reduced from one and a half shifts previously to one shift a day currently. As a result, logistics costs have also fallen sharply. Moreover, the picking output at Berner has increased to around 3,000 order lines per hour.
Berner promises its customers that it will deliver within 24 hours after the order has been entered in the SAP system. “The last order time does not play such a major role in this context because the majority of orders come in over the course of a day”, says Herbert Grübel, Head of Materials Management at Berner GmbH in Künzelsau. By extending the deadline from 1 p.m. to 3 p.m., practically all customer requests can be met by the next working day – a key selling point in a competitive market environment. “What used to be considered a rush order is now a standard order for us. Because the DPS system is highly dynamic, we are able to satisfy our customers’ delivery wishes without any problems”, explains Grübel.
From two-phase picking to a pick & pack solution – double-digit increase in productivity
In the old two-phase picking system, which involved a high bay warehouse and separation of the picked articles at order level, productivity was not always satisfactory for Berner. “Now, however, with the double-digit increase in productivity, which we have achieved together with Witron, we are able to set ourselves apart from our competitors for the long term”, says Grübel. “The separation at order level has been axed completely, making our operations quicker and far more efficient.” This means that Berner has, in principle, cut out one entire level in the process.
The changing movement rates of the articles depending on the order structure are automatically taken into account by the DPS through their variable placement in static or dynamic tote channels – there are 2,200 of these channels at Berner. Since these enable access to the 6,500 different articles, the paths that the operators have to take are shortened significantly. What is more, this principle allows extremely compact warehousing. Picking takes place on two networked levels at a total of 20 picking stations, which are supplied with storage goods by six stacker cranes. Each aisle in the three-aisle DPS tote warehouse is equipped with two integrated stacker cranes, which not only cover outbound and inbound storage functions, but also ensure the continuous replenishment of the totes in the picking channels of the DPS. The storage capacity has also been extended: before the expansion, there were 21,500 pallet and 57,000 tote storing positions available, whereas now Berner has a further 2,300 pallet positions at its disposal. In addition, the capacity of the tote warehouse has almost doubled with an extra 55,000 storing positions.
Cost efficiency and flexibility tipped the scales in favour of the DPS
“Berner and Witron decided on the DPS solution together as the way to guarantee the best possible availability of goods at all picking stations and optimum processing for the entire system”, says Josef Gallersdörfer, Witron Associate Director in charge of the Berner project. “During the ramp-up, the WITRON DPS system and the old Berner system had to be synchronised while maintaining full output from the plant every day. This joint realisation of the project worked very well because the structures of both partners fit together.” Berner and Witron are owner-run, medium-sized companies with a high degree of innovation and short decision-making paths.
“We managed to resolve any issues that arose directly and easily with our general contractor Witron”, says Head of Materials Management at Berner, Herbert Grübel, in affirmation of the good working relationship. “When it came to awarding the contract, we chose Witron because it offered the best, most cost-effective overall concept of all the tenderers. The DPS is the right system to achieve the output we require in our business. The solution could be integrated superbly into the existing Berner infrastructure, enabling us to continue using the old warehouse. Another point in the DPS’ favour is its modular expansion capability based on standardised technology. What is more, the budget agreed for upgrading the logistics solution was maintained exactly during the realisation of the project.”
At the DPS picking stations, employees can pick from totes and from pallet staging areas directly into the shipping cartons. This gives Berner the flexibility needed to exploit the advantages of the DPS system even in the event of major changes within the product range, which currently lists 25,000 articles. “There is also the fact that there were already more than 30 DPS plants worldwide in a huge variety of sectors, all working very successfully in practice. So, we had the necessary confidence in the technology”, explains Grübel.
One challenge, in Grübel’s eyes, lay in the split between the old plant in continued use and the new plant because stock responsibility was also transferred to Witron at this time. “A step that we discussed long and hard internally”, says Grübel. “Because for us this means the definition of a further interface, as stocks now have to be managed not only in the Berner WMS and the SAP system but in the Witron system as well.” However, for the Witron DPS, this stock responsibility is crucial to the efficient distribution of the load throughout the plant.
Well-equipped for future challenges
Berner is quite satisfied with the results following the implementation of the new logistics structure. Grübel sums this up by saying: “It is proving extremely popular with our sales force. We have managed to significantly increase the speed of our deliveries for our customers.” The issues of ergonomics and working height in the picking area have also been resolved optimally in line with Berner’s requirements. An added benefit is a considerable gain in storage area, which can be used efficiently for other tasks in the future.
Direct seller Berner also believes that with the DPS it is well-equipped for future challenges. “The share of Internet sales is growing significantly, and this of course has a direct impact on our order structure”, explains Grübel. There is also the possible option of opening more shops that are local to customers. “Shipments are becoming increasingly small-scale and order frequency is on the rise – a flexible and highly efficient logistics structure is an absolute must for us in an environment like this if we are to enjoy sustainable success in this business. With the new DPS, we can continue to improve on the high level of service we already provide for our customers and, as a result, expand our market share”.
Author: Thomas Wöhrle, journalist, Karlsruhe.
Combined Berner Group:
The Berner Group, headquartered in Künzelsau, Germany, is one of the leading European direct sellers, offering an all-round service in the small components business to professionals in the building construction and automotive sectors, as well as other industries. The balance sheet date of 31 March 2008, the Group employed around 8,000 people, some 5,000 of them on the sales force. In the 2007/08 financial year, the Berner Group achieved two-digit growth. It increased its sales by 11.6 percent from 780 to around 870 million euros. It also discerned a significant trend towards internationalisation: with a rise of 14.3 percent, the distribution companies in Europe made a decisive contribution to the success of the Group. Domestically, Berner increased its sales by 5.7 percent from 283.8 to 303 million euros.
Witron Logistik + Informatik:
Founded in 1971, Witron Logistik + Informatik GmbH, headquartered in Parkstein (Upper Palatinate/Eastern Bavaria), is now a leading company in the planning and realisation of automated logistics system solutions. Numerous national and international market leaders from trade and industry rely on the interdisciplinary and cross-sector expertise that Witron has managed to amass in 38 years through the implementation of more than 2,000 specialised logistics projects in a vast range of fields in the business world. As general contractor, Witron is responsible for the budget, schedule and functions throughout all phases of the project: from conception and planning to assembly and full realisation of the logistics plant, and right through to the subsequent plant ramp-up phase. Even after the project has been completed, users can continue to have access to Witron’s know-how during the entire lifecycle of their plant thanks to a customer support partnership.
The Witron Corporate Group has roughly 1,000 employees worldwide. Annual sales in 2008 amounted to EUR 200 million. Other branches are located in Arlington Heights, Illinois (USA), Venray (the Netherlands), Madrid (Spain) and High Wycombe (UK).