AS/RS the ‘Backbone’ of an Automated Material Handling Logistics Solution

viastore has implemented an automated warehouse and picking solution for Phoenix Contact a global manufacturer of industrial electrical and electronic technology products at the company’s US operations headquarters, based in Middletown, Pennsylvania.

The viastore solution includes robotic depalletizers, a conveyor sortation system, a seven aisle mini-load automated storage and retrieval system (AS/RS), and ten (10) Goods to Person pick/pack stations, all driven by a warehouse management system (WMS) that also controls a conventional warehouse.

The entire automated material handling system was supplied by viastore systems.

Phoenix Contact develops and manufactures industrial electrical and electronic technology products that power, protect, connect and automate systems and equipment. The company has almost 13,000 employees worldwide with a global headquarters in Blomberg, Germany. US operations are based in Middletown, Pennsylvania and include both manufacturing and distribution, with more than 500 employees.

As a manufacturer of industrial automation, interconnection, and interface solutions that are often mission critical items for its customers, Phoenix Contact wanted to bring production and logistics closer to their customers, to provide shorter lead times, easier on-site reviews, faster response and increased flexibility to ensure accurate and on-time delivery to its North American customers.

The solution to do this includes a robotic depalletizer, conveyor sortation system, a mini-load automated storage and retrieval system (AS/RS), and ten (10) Goods to Person pick/pack stations driven by a warehouse management system (WMS) that also controls a conventional warehouse. The entire automated material handling system was supplied by viastore systems.

“The automated material handling solution has become the backbone of the company’s distribution center operations, and more recently has been critical in the supply of components in our US manufacturing as well,” said Lou Paioletti, director of supply chain services for Phoenix Contact. The company has 3 regional supply chain hubs globally, in Germany, China and the US. The US facility was designed to support the North and South American subsidiaries.

For Lou Paioletti, director of supply chain services at Phoenix Contact the viastore automated distribution center is delivering results. The system has delivered doubled the productivity of the facility.

While the German facility already had an automated solution from viastore, the US facility did not. “We received product manufactured in Europe at our US facility already in totes, using our supply of company-owned sea containers,” said Paioletti. “We knew we needed to automate our US facility, both in systems and in software to support Phoenix Contact’s growth in the Americas, as well as growing manufacturing in the US. Without it, we were on a fast path to run out of space in a couple years.”

Having a common automation solution across multiple facilities made sense from a sharing best practices standpoint as well. “There was a collective mindshare in trying to utilize a global solution,” added Paioletti. “Having an automated facility in Europe, we already saw the potential that an automated facility in the US could bring our operations.”

A Phased Approach
For the US facility, a new 50,000 square foot building was constructed in 2008 to house the AS/RS. This freed up the existing 45,000 square foot building next to it previously used for distribution to be used for manufacturing. Using a dense storage AS/RS meant a smaller new building footprint as the nearly 40 foot tall AS/RS system allows for effective total use of space within the building.

Initially, 4 aisles of AS/RS and 10 pick/pack stations were constructed with space for anticipated growth.

The viastore WMS controls the AS/RS as well as the transportation system including vertical sequence buffers and conveyors feeding the pick/pack workstations. It also optimizes the material flow and AS/RS machine movement. A visualization module (VISU) in the WMS and MFC allow for easier system monitoring and maintenance via a graphical user interface display providing system operators with visibility to the system for system status and diagnostics. KPIs and other information can be stored to provide information for further system optimization.

Labor Saver (and by choice) Not a Reducer
As product from Phoenix Contact’s European manufacturing came to the US already in totes, using the same size totes for the US AS/RS made sense. “We saw an immediate labor savings from being able to take inbound product from Europe and induct it into the AS/RS with minimal interaction,” said Paioletti. “We knew this would be a labor saver, and made an immediate impact.”

An additional benefit of the automated solution has been the reduction of cardboard packaging on the inbound side. “Every week we receive and return our totes, using our company owned sea containers,” said Paioletti. “This reverse logistics and environmentally sound approach reduces packaging as the same totes are used from the European to US AS/RS, and then back.”

Phoenix Contact prides itself on never having a layoff and this continued even with the addition of an automated material handling solution. “The automated picking of the AS/RS requires less staff, but we were able to re-allocate those people in new positions within the company,” said Paioletti. As the AS/RS doesn’t handle each and every product, manual picking is not going entirely away.

“Items that don’t fit in the AS/RS need to be manually picked using the viastore WMS. We also have customers that buy pallet loads so those bypass the AS/RS as well,” continued Paioletti.

viastore systems provide customers with new and retrofitted automated warehouses and distribution centers – including system design, material handling equipment, integration, controls, core software (WMS, WCS, PLC), and construction services.

Adding Manufacturing
Growth and a plan to add the company’s manufacturing components in the automated facility meant an additional 3 aisles were added to the mini-load AS/RS in early 2012. This resulted in a current configuration of 7 aisles of AS/RS with 72,000 storage locations. The same 10 pick/pack stations and conveyor serve all 7 aisles.

The system helps manufacturing by storing components for the development and manufacturing part of Phoenix Contact’s Regional Business Unit operation. The AS/RS is used to pick component parts for production. Finished goods from production also go into the AS/RS for storage.

In addition to the AS/RS, Phoenix replaced a legacy WMS that was used to run carousels. The new WMS (viad@tWMS from viastore) drives all the work within the AS/RS and also controls the conventional warehouse, and is integrated with the company’s ERP.

Poised For More Growth
When built, the automated distribution center was designed to have multiple aisles of AS/RS, but we started with 4 and added 3 more to give us 7. The building could max out at with 12 aisles of AS/RS total.”

The Benefits
The automated material handling solution provides Phoenix Contact with an automated distribution center that provides a higher throughput while saving operational costs, and also provides high density double deep storage and allows the facility to have a higher level of system availability than conventional warehousing.

For Lou Paioletti of Phoenix Contact, there are 2 main areas where the automated distribution center solution has helped. “Our receiving area saw a huge efficiency gain with the robotic depalletizer,” said Paioletti. “What used to take 7 people 2 ½ days to unload a sea container now takes 3 ½ people 6 hours to unload. This increased processing speed has reduced our lead times, resulting in lower required reorder points and, subsequently, more efficient inventory levels. Overall, when looking at total labor and line items shipped, the system has delivered a 50%+ productivity gain.”

For Phoenix Contact’s Paioletti, having a single automated material handling system solution that supports finished goods to customers and components to manufacturing operations creates true economies of scope. “Our WMS handles both a fully automated AS/RS and conventional warehouse using the same software,” said Paioletti. “This gives Phoenix Contact the ability to better serve customers and improve manufacturing support, all from a single solution.”

It’s All About the Flow
For Phoenix Contact’s US operations, product comes to the Middletown, PA distribution center in totes on pallets from Germany, along with other strategic global supply points, and internally from manufacturing in Middletown. The pallets are placed on a pallet conveyor and the totes are removed via an automatic depalletizer and inducted into the AS/RS.

Product and order info from the ERP goes to viad@tWMS and the WMS does the allocations and sequencing and picking of totes to the pick stations to fulfill customer orders. Simultaneously while picking customer orders, the AS/RS is picking components for manufacturing work orders.

Related: Warehouse Management System with Automated Warehousing and Picking Solution