Automated storage scales with rapid growth

A startup company founded in 2002, DC Dental delivers supplies to dental professionals in the mid-Atlantic region. The company inventories more than 20,000 of the most commonly used dental products in its Baltimore warehouse. After a 2012 acquisition increased warehouse volume by 54% overnight, the existing 30,000-square-foot facility was quickly nearing capacity and product began to fill the aisles. By installing an automated storage and retrieval system (AS/RS), the company handled the increased volume while using less labor and floor space.

“We considered outsourcing to a 3PL, but it was important to us to keep distribution in house to ensure we maintain our customer commitments of speed and value that have made us successful,” says Howie Friedman, CFO/COO of DC Dental.

The integrated solution (Kardex Remstar) uses a pick-and-pass fulfillment strategy with a 20-position batch cart that moves between three zones:

• Zone one: two 21-foot-tall shuttle vertical lift modules (VLMs), 12,000 SKUs;
• Zone two: four 56-foot-long horizontal carousels, 7,000 SKUs; and
• Zone three: carton flow rack, 850 SKUs.

The new systems are all managed by inventory management software. Dentists can place orders in various ways—in person, over the phone, by e-mail or online. Due to productivity gains, DC Dental was able to extend order cutoff time by an hour. Since the implementation, DC Dental has handled a 54% volume increase with 67% less labor and 73% floor space savings. Using the AS/RS, roughly 13,000 square feet of shelving was consolidated into 3,500 square feet. This recovered floor space allowed DC Dental to reduce the overall footprint of the facility from 30,000 square feet to 20,000 square feet. They re-signed their lease, saving nearly $1 million dollars in rent and utilities over the next 10 years.

The warehouse now picks an average 2,500 lines per day to fill roughly 480 orders using only four order pickers, compared to the 12 order pickers previously required.

“The system has the ability to handle up to 3,500 lines per hour with our current labor resources, but we haven’t needed it yet,” says Friedman. “We could double in size and only need to add about three additional people in our warehouse.”

Using light-directed technology for picking and putting activities in addition to a scan verification step has increased pick accuracy from 94% to 99.5%. In addition, cameras above each put station record every item put into an order. Cameras were also installed above the shipping stations, so each package is captured just prior to being sealed along with the shipping labels being applied.