S Gold & Sons, based in Leyton, East London, was one of the nation’s first record wholesaler and first video wholesaler. Stocking some 30,000 VHS, 15,000 DVD, 80,000 CD and 20,000 audio cassette titles plus about 1,000 accessory lines, Gold has a turnover of some £50M. The majority of its customers – which include Harrods, Selfridges, HMV and Virgin/Our Price – order on-line and, in addition to the UK, the company serves some 90 countries overseas.
Growth forces change
As the company moved into the 21st century, it became obvious that it needed to move to bigger premises. It was also clear that new working practices were needed in order to maintain and improve customer service levels.
The company prides itself on fast delivery, with goods ordered by 5pm being delivered to the UK mainland the next day. At the firm’s old premises, orders were picked into carts on he man-to- goods principle. The pick face was in total over one kilometre in length and, due to space restrictions, no longer fully logical. To meet the demands of last year’s pre-Christmas period – the company’s busiest time – temporary staff were recruited as early as August because it was at least a month before they could understand the picking layouts and contribute fully to the required outputs.
Many construction headaches “When it finally came to moving premises, we chose a pre-owned building and we got some things right but some things wrong,” admits Garry Elwood, sales and marketing director. “On the plus side, we decided not to move far geographically. This meant that we didn’t lose any of our trusted and loyal staff,” he says. “We had planned to move into our new, much larger site with new order picking technology during the summer – traditionally our quietest trading period.
“With hindsight, it may have been a mistake to refurbish a pre-owned building. If we had gone for a new structure, we could have written our own specification but it would have taken longer – possibly an extra year.”
As it was, the building refurbishment programme revealed previously hidden flaws almost every day. The roof, walls, floor and windows all contained serious constructional defects. As Gold’s busy period started in September, the company was forced to start installing conveyors, racking and computer systems during a very wet summer into what was, without exaggeration, a building site.
To complicate matters further, the firm planned to move its stock and personnel from the old premises to the new site over four weekends while continuing to trade normally during the week. In addition, most of the shelving and racking that the stock was stored in was to be dismantled, re-erected at the new site and then re-loaded with the stock.
Explains Mike Gibson, warehouse manager: “It was at this point that the contractors we had chosen pulled out all the stops and showed us exactly what they were capable of. Our schedule of work had always been tight but the building problems had left that in tatters.
“On the first day of full working at the new site, both our staff and the new order picking and allied systems ran like well-oiled clockwork. Almost immediately, though, our contracted transport carrier suffered congestion problems and our deliveries as good as stopped. After what we had been through with the building, it was almost the last straw.”
Intelligent conveyor system
The new order picking system was devised by Alan Wilson Associates and installed by Knapp UK, which is part of a group that has supplied some 600 materials handling installations worldwide over the past decade.
The system operates on the goods-to-man principle, with picking performed manually into totes from picking faces that are gravity fed or in static racking. All stock items have been previously analysed by ‘Cubi Scan’ and their sizes and weights logged in the volumetric database.
As new orders are launched into the system, they are split into logical sets that will fit into a tote box initially and finally into one of a set of standardised shipping cartons. An order or part order is allocated to a barcoded tote, which is transported by Knapp intelligent conveyor to the first pick location. Here, the tote is diverted off the main transport conveyor onto a non-powered spur beneath the picking faces.
Once picking of that section of the order is complete, the tote is pushed back onto the driven conveyor line and automatically transported to the next pick station where items for that order are located. Finished orders are conveyed to checking and packing stations to make them ready for shipping. Incoming stock is transported to the picking stations by the same conveyor but in totes of a different colour.
Investment pays off
“The pickers now work in teams around each pick or work station,” explains Gibson. “This has meant that each team has taken ownership for its area and its knowledge of the stock in that area has risen, resulting in a much improved standard of service to our customers.
“The system is running extremely well. I can say this confidently for two reasons. Firstly, we needed only one third of the usual number of temporary staff to help us through the heavy pre-Christmas period.
“Secondly, we were told that we had just completed a record week but the warehouse staff hadn’t realised it because with the new order picking system they can now output so much more without strain.”
Elwood adds: “The biggest benefit to the company as a whole has been that our order taking has moved up a couple of gears. Now my sales staff can log orders on their laptops from their customers’ offices directly to our mainframe, which automatically issues a picking order to the warehouse. A customer’s order can now be picked and packed before our sales staff have even left the client’s premises.” n