Modular rack moves with distributor to larger, taller facility

Founded in 2004, R1 Concepts manufactures and sells every component in an automotive brake system. The company has experienced double- to triple-digit growth every year since. To handle the rapid growth, the company has had to move six times, expanding from its original 400-square-foot space to the current 106,000-square-foot facility in Cerritos, Calif. Grown from three original employees, the company now has close to 100. Since installing a new rack system, R1 has improved space utilization, efficiency and flexibility.

The company sells worldwide directly to the consumer through online retail channels such as Amazon, eBay, Craigslist, Sears and its own Website. As the company began acquiring more products to meet growing demand, its pick and pallet storage requirements increased significantly. For instance, its average daily inventory a year ago was 12,000 SKUs, and today it is more than 100,000.

Dan Nguyen, founder, sought additional space for storage while maintaining safe forklift maneuverability. The primary considerations for a new racking system would be load capacity and compliance with local, state and federal seismic regulations, which is particularly important in California.

“Our products are extremely heavy,” Nguyen says. “For instance, each brake rotor weighs 15 pounds and there are at least 100 rotors on each pallet.”

The company now uses the first four levels of the expanded racking system (Hannibal Industries)  for order picking while the top four levels are for pallet storage. The new rack system meets and surpasses all existing safety standards. The installation features unique structural engineering design elements enabling each rack’s flexible dual-movement frame to flex laterally during an earthquake. This reduces the risks of frame collapse and damage to stored goods, and greatly improves safety.

All frame components are interchangeable and can be built to various heights, so that as the company grows, the length and width of the racks can be easily increased. In fact, because of the rack’s modular design, the company was able to use all the components from its previous facility when it moved into its current warehouse, while increasing from 168 inches to 240 inches.

Nguyen says he especially likes the modularity because he anticipates another move within the next year or two as he and his partners eye further expansion into the wholesale auto parts market as well as possible brick-and-mortar retail operations. Nguyen says, “We just want to be ready with the quickest, most efficient order fulfillment system anywhere.”