Flexibility and practicality counts

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Matalan PLC is one of Britain’s leading value retailers, with 180 stores nationwide and 10.5 million active members. The company is a unique out-of-town retailer, dedicated to providing outstanding value for money. Matalan offers up-to-the-minute fashion and homewares at prices up to 50% below the equivalent high street price.

This unbeatable ‘value for money’ pricing philosophy is achieved through buying direct from the manufacturer and having convenient out-of-town stores with low overheads. With an average 2,790sq m per store, Matalan’s product range offers a comprehensive selection of quality homewares, ladies’, men’s and children’s clothing and footwear – all under one roof.

European supply chain solutions company Wincanton is operating the automated warehouse facility in Corby on behalf of Matalan. The centre will serve the retailer’s stores in the South.

The four-and-a-half year contract has already started with the transformation of a former plastics factory into the new warehouse. This involves gutting the space, rewiring it, and fitting it with sortation and racking equipment for both hanging and boxed garments. The warehouse includes a 16,000-pallet high bay and automated sortation equipment to sort hanging and boxed items by store.

The new warehouse will initially handle about a quarter of Matalan’s volume. This is set to grow to 50% by 2008. Once opened, the warehouse will have in the region of 200 employees.

Matalan’s store base used to be predominantly in the North but recent expansion has seen growth in the number of stores in the South, including the latest opening on the Isle of Wight, so Matalan needed a warehouse to meet the increase in demand. Matalan has been growing apace over the past few years and found itself unable to support the planned roll-out of new stores in the South. The retailer, which has two existing facilities in Lancashire, has built the new Corby distribution centre to handle the business.

Roger Burnley, supply chain director at Matalan, comments: “It has always been our strategy to open a warehouse in the South in line with store growth. We decided to outsource to Wincanton due to its significant experience in retail warehousing and the fact that Wincanton already manages national transport operations for Matalan. The new warehouse will supplement peak trading this year and the fact that Wincanton is able to offer flexible solutions to support this helps to meet our needs.”

Martin Taylor, managing director, general retail and industrial at Wincanton, says: “We are pleased that we have been able to build on our existing relationship by providing further solutions to add value across Matalan’s supply chain. We work with a number of leading retailers and have nine fully automated warehouses across the UK, which means we are able use this experience and market knowledge to increase productivity and enhance availability.”

Extra capacity

SDI Greenstone has installed a high-throughput automated storage and sortation system at Matalan’s new 32,000sq m southern distribution centre in Corby.

With a turnover in excess of £1Bn Matalan is the UK’s biggest volume retailer. The new centre, adding to existing facilities in Lancashire, has been established to provide the company with the extra capacity it needs to support the growing number of stores in the South. Matalan currently has 186 outlets nationwide, a coverage which is expanding at the rate of around ten new stores each year. By June 2005, the Corby distribution centre will serve some 90 stores in the South.

The new facility is operated by third-party logistics business Wincanton, and will store both hanging and boxed goods. It marks Matalan’s first use of a boxed-item sortation system.

SDI Greenstone won the contract to design, build and project-manage the new installation, in a competitive tender, on the strength of its understanding of fashion logistics, the highly pragmatic nature of the solutions proposed, and the track record of the systems it has already installed at Matalan’s Skelmersdale distribution centre. SDI Greenstone also completed the entire project to meet very tight deadlines.

The SDI Greenstone installation, built into a 25,500sq m low bay warehouse, consists of separate systems for hanging garments and boxed items. The hanging garment system has the capacity to handle almost 1.2 million items. Eight receiving bays serve the hanging garment system, the core of which is a three-tier goods on hangers (GOH) zone. Sets of garments, arriving from the suppliers on hangers, are unloaded onto height-adjustable telescopic booms at the eight receiving bays. The items are placed onto 100mm barcoded plastic trolleys.

Each boom feeds five holding lanes which have the capacity to accommodate 4,960 trolleys – about 22,800 individual garments. Colleagues apply barcoded, store-specific, ‘Licence Plate Number’ (LPN) labels, generated by the distribution centre’s warehouse management system (WMS), to the garments on the trolleys. The LPNs are then scanned to log the items into the inventory control system.

Two pin-chain powered conveyors take the trolleys up to the pre-sort area on the mezzanine floor where their barcodes are read by in-line laser scanners. Here there are three lanes – two from ground floor goods in and one from the sorter’s recirculation loop – each capable of handling 1,500 trolley sets per hour. It is at this point that the individual garments are matched, by manual scanning of their barcodes, to the trolleys that are carrying them. From here on through the system, the goods are routed automatically by scanning the trolley barcodes.

From the scanning zone the trolleys pass through the first of two barcode reading pre-sorters and are directed, by PC control, to one of the three further hang sorters, one of each of the three GOH tiers, for either static storage or cross-docking for delivery to store. The ground floor sorter has 332 static lanes holding 81,500 trolley sets while the first floor has 338 lanes holding 80,730 sets and the second floor features 204 lanes holding 55,080 sets.

All three tiers have a virtually identical layout, with central transverse lanes from which the goods are diverted into their allocated storage zones. There are also areas where items are transferred from their trolleys and hung, batched by SKUs, onto static storage rails from where the orders will be picked. The top floor also has a further 176 lanes, holding 32,120 sets, for new products and stock ready for despatch to stores.

Store identification

All locations are barcoded, and picking is driven by RF commands relayed to hand-held scanners. Garments are picked from storage and loaded back onto trolleys. The trolley barcodes are scanned before being released onto pin-chain take-away conveyor circuits to pass on to a despatch sorter which reads the trolley barcodes.

This sorting operation identifies the stores to which the goods will be sent. The despatch sorter feeds 28 overhead gravity lanes, which lead down to 14 despatch bays. On command from each bay, the gravity lanes can be released in sequence onto a pin-chain conveyor that feeds telescopic booms reaching into the delivery vehicles.

SDI Greenstone’s boxed item system occupies around half of the low bay warehouse, served by six goods-in bays. Two open onto the yard for unloading palletised deliveries and four are equipped with 12m telescopic belt booms. Loose-loaded goods are removed onto the telescopic belt booms and transferred to a ground-level area for manual palletising and labelling.

At the peak periods the four booms are expected to handle around 41,000 cartons daily. The remainder of incoming consignments arrive, already palletised on curtainsider vehicles, and are unloaded by counterbalance forklifts in the yard.

Every pallet is given a barcoded LPN label, the details of which communicate with the WMS by RF. The WMS then routes the goods to one of three locations. Slow-moving items and long-term bulk stock goes into a 16,120 pallet location high bay store, served by three automatic storage and retrieval cranes, in an adjacent 31,600sq m warehouse. Moderately fast-moving stock is sent to a 4,525 pallet location narrow aisle racking storage zone, while fast-moving stock already allocated to specific stores is transferred to two three-tier picking towers for cross-docking.

The picking towers consist of three-high, four-deep, live pallet racking accommodating 1,716 pallets and providing 429 pick faces. The WMS directs staff, by RF communication to wrist-held scanning terminals, to the required picking location. The goods’ LPNs are scanned to confirm pick, and the items are placed onto pick-to-belt take away conveyors. Each carton is loaded with its SKU barcode uppermost, so it can be read by the scanners at the sorter’s induct points.

Spiral belt conveyors handle the picked stock between levels of each pick tower, transferring picked goods to the boxed-goods sorter. There are two dedicated lines, one from each pick tower, which merge with a re-circulation loop into one line ahead of the sorter’s induction point where all goods are aligned for automatic scanning. As items are inducted onto the sorter loop their barcodes are read by an array of in-line scanners, and the items are discharged, by pop-up wheels, as required onto 40 output ‘store chutes’.

The sorter also has a post-sort scanner to identify items whose barcodes have been mis-scanned, or for which there is no matching data in the WMS. These items are diverted onto a reject spur for rectification. Goods will also be automatically re-circulated if their destined store lanes are already full.

All the despatch lanes are addressable and selectable so several lanes could be made available for goods for just one store. SDI Greenstone has also provided the facility for loading goods directly from pallets onto the sorter, without having to travel through the rest of the system. The sorter has the capacity to handle around 4,000 cases per hour – more than one case per second.

Each of the 40 store chutes has declined powered belts and gravity rollers which take the goods down to the despatch bays. Here staff load the items into roll cages, scanning each carton to confirm picking to the WMS. Up to 1,800 roll cages can be marshalled in the ground floor area adjacent to the 14 despatch bays.

Retailing trends

The control software for both the boxed goods and hanging garment storage and sortation systems was specially written for the Corby installation by SDI Greenstone’s sister company RTI. To give the entire installation a very high degree of flexibility to cope with future retailing trends, and as a measure of security, the software for both systems is interchangeable. To optimise the systems’ accuracy and speed of throughput, multiple-head scanning units are used throughout to ensure that barcode labels can be read.

The high-bay AS/RS storage facility, complete with its two aisle changing cranes, was already in place when Matalan took over the Corby warehouse, having been left behind by the previous occupant. SDI Greenstone has re-engineered this facility, recommending a third fixed-path crane and changes to the pallet handling system at the portal to the high-bay store to double its handling capacity.

Two new pallet in-feeds, and two out-feeds have been built, along with an additional accumulation system which similarly doubles the back-up capacity. A special eletro-mechanical system has also been developed to automatically check the integrity of the bearers on the pallets to ensure smooth and accurate handling in the AS/R process.

David James, Matalan’s head of supply chain development, says: “The Corby DC is crucial to our continuing expansion in the South, and to give us maximum flexibility to meet future demands we are handling both hanging garments and boxed items at the site. The contract was awarded to SDI Greenstone partly on the strength of the hanging garment system the company has designed for our Skelmersdale DC, which has been performing admirably. The hanging garment system at Corby is based on the Skelmersdale solution.

“But Corby is the first site at which Matalan has used automated sortation for the boxed items and we had to be totally assured of its efficiency. The solution that SDI Greenstone proposed for this was pragmatically simple, flexible and practical with no unnecessary ‘bells and whistles’. It looked right on paper, and it works well in practice.”

The appointment of Wincanton to operate the Corby site marks Matalan’s first use of a third-party logistics (3PL) company, although the 3PL has held the transport contract for Skelmersdale since late 2003. Wincanton won the Corby job, James explains, largely because of its expertise in working with automated storage and sortation systems. The choice of systems integrator was decided jointly by Matalan and Wincanton.

Les Bielby, Wincanton’s project director, comments: “Working with the volumetrics supplied by Matalan, SDI Greenstone came up with one of the best solutions we have ever seen. The storage and sortation systems are superbly engineered and elegantly simple. We were particularly impressed with the ease with which the systems integrated with the WMS.”

The Corby distribution centre began operating in volume last month and will build up to full throughput by mid-2005. n

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