Merger of Solo Cup and Sweetheart yields high-tech and low-tech solutions

Solo Cup Co., Social Circle, Georgia
Size: 1.3 million sq ft
Products: Full line of paper, plastic and foam dinner ware and packaging
Storage capacity: 2.4 million cases
Throughput: 17.2 million cases per year

Mergers, acquisitions and consolidations are a major factor in the market when it comes to new warehouses and distribution centers.

As industries consolidate and competitors merge, one new facility can often do the job of two and do it more efficiently.

That was the driving force behind Solo Cup’s new warehouse and distribution center, which opened last fall in Social Circle, Georgia.

The 1.3 million sq ft facility was built following the merger of Solo Cup and Sweetheart, two of the best-known names in the plastic, foam and paper dinnerware products industries. The facility was designed to store 2.4 million cases and see throughput of to 17.2 million cases.

“Between the two companies, we had three channels of distribution and five facilities in the southeast United States,” says Tom Pasqualini, Solo Cup’s executive vice president of operations and supply chain. “We consolidated all of that into this one new facility.”

In addition to consolidating activities into one facility, Solo also created a new order management process known as One Face To The Customer, adds Bob Rouse, director of distribution at the Social Circle facility. “The idea is that regardless of the product the customer is buying or the division they’re buying from we do it with one order on one truck and one invoice,” Rouse explains.

That meant replacing three separate order management systems with one system that can process orders for all three distribution channels.

To manage those orders, the facility relies on a combination of high tech and low tech system.

On the one hand, palletized inventory is stored the old-fashioned way – on the floor or on single-deep pallet racks.

On the other hand, automated guided vehicles (Dematic, http://www.dematic.us) moves up to 16 pallets at a time from the receiving dock to single-deep pallet rack and floor storage zones located through the 1.3 million sq ft facility. The flow of materials and operator tasks are managed and automated by a best of breed warehouse management system.

The end result is more efficient operations for Solo Cup and a better experience for the company’s customers. “Our distribution centers were never just a place to stick product,” says Rouse. “Now with our one order, one truck and one invoice strategy, it’s a much better value proposition for our customers.”  

Building the better warehouse
The new facility does double duty.

First, it serves as a finished goods warehouse and distribution center for products manufactured at plants in Augusta and Conyers, Georgia, as well as finished goods from Solo’s other 18 manufacturing plants that aren’t produced locally. Those products are distributed to customers in the southeast and are often cross-docked. In those instances, velocity of movement through the facility is paramount.

Solo also employs a buffer strategy, holding finished goods from Augusta and Conyers that might be needed down the road at another regional distribution center. “Rather than anticipate the demand at the other distribution centers, we ship all of the finished goods to Social Circle and hold them there as a buffer,” says Rouse. “Then, when the demand comes in from another distribution center, we ship them just what they need.” In those instances, products may be warehoused for longer periods of time.

The facility was designed to handle both of those scenarios. For instance, dock doors were placed on two sides of the building to facilitate cross-docking.”We have a fair amount of product that comes in and goes out the same day,” says Rouse, “and we store hot items that will ship soon near the dock doors.”

The building was also laid out in zones, managed by the warehouse management system. “Using the WMS, we can zone storage by products, by product lines, by customers or any other method we choose to provide the least amount of travel time to improve productivity,” says Rouse.

For instance, some large fast food restaurant customers are served from the facility. “Their products don’t mix with the other product lines,” explains Rouse. “In a building this size, we can create a zone for those customers near a dock door, store their product on the floor, and move it with a lift truck. That’s faster than storing it and retrieving it.”

Meanwhile, buffer inventory may be stored on the floor or in pallet racks deeper in the facility.

High tech, low tech
In addition to doing double duty, the facility is a combination of low tech and high tech processes.

“We are fairly conventional in terms of storage,” says Rouse. “But we also have the AGVs, a WMS, radio frequency communication and automatic data collection. Where technology made sense, it was employed.”

What’s more, the WMS operates in real time. “We’re doing real-time picking and real-time receiving,” says Rouse. “That information goes from our WMS right up to corporate headquarters for real time visibility of our inventory.” 

The goal in combining automation with traditional processes was to drive more productivity with less overhead. The AGV’s are a good example of that strategy. “In the older buildings, which were also pretty big, we had lift truck drivers moving one or two pallets at a time from the dock to a storage location,” says Rouse. “Now, rather than 16 lift trucks traveling the whole length of the building to put away 16 pallets, one AGV can move 16 pallets at a time.” 

The AGV’s not only cut down on the amount of distance traveled by the lift trucks, they also create a safer working environment.

In all, the facility is served by six AGV’s, each tugging four carts. The self-guided vehicles are kept on track by magnets in the facility floor. “In order to change the path of the AGVs, all we have to do is turn on or turn off some of the magnets,” Rouse explains.

Finally, Solo installed a new high-rise battery changing and self-watering system to reduce the cost of maintaining its fleet. “We can change out a dead battering in about three minutes with this system,” says Rouse. “It used to take five to ten minutes a battery with the old system.”

With 65 lift trucks operating on three shifts, Rouse says, the saved time adds up quickly.

At the end of the day, says Rouse, the strategy has paid off. “The proof is in the pudding,” he says. “We’ve not only consolidated several building into one, we’ve been able to grow the business with no addition to our head count.”

Systems suppliers
Automated Guided Vehicles: Dematic, http://www.dematic.us
System Integrator/Warehouse Management System: Catalyst International (now part of CDC Supply Chain, http://www.cdcsoftware.com/en/default.aspx
Lift trucks: Yale, http://www.northamerica.yale.com  
Battery Change System: Sackett Systems, http://www.sackett-systems.com
Dock Equipment: 4Front Engineered Solutions, http://www.4frontes.com 
Rack Storage: HCM Systems, http://www.hcmsystems.com

This article originally appeared in the June 2007 issue of MMH.