Any FMCG company will tell you that the only way to succeed in a fiercely competitive market is by streamlining logistics. Voice picking in all distribution centres, and an automated pallet runner have resulted in huge savings for Norway’s REMA 1000 food retail chain.
For over 20 years, REMA distribusion, the logistics arm of REMA 1000, has driven warehouse processes in partnership with Consafe Logistics, who provided REMA with a WMS (Warehouse Management System). The company constantly upgrades its system and practices to achieve excellence throughout the supply chain. REMA has six distribution centres throughout Norway. Here we highlight two of them, one in Stavangar that uses manual picking, and one in Trondheim that has introduced a pallet runner to move all dry goods throughout the warehouse.
One of the main benefits REMA’s management experience with their WMS is 100% uptime. "It’s extremely important for us to supply goods as cheaply and efficiently as possible. Through using a WMS that gives us total reliability we can concentrate on greater streamlining of our distribution flows and constantly becoming more efficient", says Narve Lyder Carlsen, IT Manager at REMA Stavangar.
Handles any level of automation
While the Stavangar warehouse supports manual picking, 30% of goods in Trondheim are moved using a pallet runner. Both systems are controlled by the WMS.
The pallet runner moves all dry goods. It stacks all incoming pallets and refills 270 picking stations automatically. All picking is manual but if a store orders a full pallet from a single producer, the pallet runner automatically packs the pallets. "We have had a slightly better than expected payback since introducing the pallet runner", says Gunnar Pedersen Lian, Logistics Manager at the Trondheim warehouse. "We had to choose between an automation manager from Swisslog, or use the automation manager function in the WMS from Consafe Logistics. We chose to integrate with Consafe Logistics’ automation manager. By using their solution we saved on costs. We knew Consafe Logistics had already integrated into Swisslog and we experienced very little trouble with communication between these systems".
The pallet runner removes man hours and truck drivers, Less people and less trucks now move more pallets around in the warehouse.
Eliminate error, pick by voice
All warehouses use pick by voice, and both the ones interviewed cite the elimination of picking errors as the single largest benefit. Thanks to pick by voice, and controls to ensure correct picking, the process is now almost 100% accurate across the company.
Stavangar has measured a 15% increase in total efficiency, or 3 minutes per assignment thanks to pick by voice. Both warehouse managers agree that picking the right goods first time saves a lot of money. But the benefits are not just measured in efficiencies. "Pickers have both arms free so they lift packages in a more healthy way. The working environment is better as there is not so much noise," says Gunnar Pedersen Lian. "It’s more efficient, takes better care of the picker and the quality of picking is better."
Decision-making on the fly
Both warehouses found the decision making support delivered by the WMS as key to operational efficiency. "We can see how many packages we have to pack within a few hours. We need to pack trucks before the end of a certain period, and we know how many packages there are per area", says Gunnar Pedersen Lian. "I can see what every picker is doing and can use system data to make pickers more efficient. It’s a very good system for planning and helping us reach our goals. We can see very quickly if we need to put in extra man hours in a particular day".
Narve Lyder Carlsen agrees, "We can take out reports on all activities in the warehouse and make decisions on the fly. We can see how an area is working and how individuals are performing. It’s quick to have overview of what’s happening and it’s an easy system for operators to learn, which makes it easy to hire people".
People were also impressed with performance of the WMS. "The WMS is a very stable system and we have very few breakdowns. We run 24 hour days 5 days a week and control the flow of goods at all times", says Gunnar.
Efficiencies throughout the warehouse
It’s very easy for IT and logistics management to extract everything they need to measure KPIs. "Thanks to the WMS we can see efficiencies from truck drivers to picking. Truck drivers are measured on how many pallet transfers they perform per hour and day", says Gunnar. "The pallet runner removed a lot of pallet transfer in Trondheim. It has the same capacity in an hour that truck drivers had in one day".
Partnering for continuous improvement
REMA faces the classic dilemma of expanding its operations without the space to expand its warehousing. By working with Consafe Logistics on a daily basis, the two companies develop processes and tools to optimize flow and solve all issues that arise.
"As well as almost daily contact, we have a management meeting with Consafe Logistics to discuss improvements every three weeks. It’s our way of being the most competitive company in our business", says Narve Lyder Carlsen.
"But one of the greatest advantages of this company is being completely autonomous. We can make whatever changes we want to without having to report to the board. That we we stay sharp, adapt extremely quickly, and use logistics to win the war of the stores", concludes Carlsen.
5 Key learnings for logistics excellence
- Invest in a flexible WMS that can handle future automation
- Implement voice picking to eliminate picking errors
- Act on information immediately
- Have a “speaking partner” to help iron out challenges as they arise
- Allow IT and logistics managers to make the necessary decisions without having to report upwards.
REMA 1000 operates over 500 stores throughout Norway. Their business model is to offer food at highly competitive prices. All logistics is controlled by REMA Distribusion, who work to constantly improve logistics performance throughout the group.