DC Slotting for Performance

Correctly slotting product in your DC can provide many benefits with excellent ROI

Learn the basics and how to get started in the following presentation

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Contents

• What is Profiling and Slotting

• Purpose for Profiling and Slotting

• The Business Case for Slotting

• Benefits of a Slotting Project

• Requirements for a Successful Slotting Project

• Models and Solutions, Example

• The Long Term Vision, Slotting as a Tool

• Keys to Success

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Slotting and Profiling

What is Profiling?

Profiling is the determination of the mix and quantities

of material storage fixturing types (pallet selective

rack, carton flow rack, etc) necessary for the different

materials handled (SKUs) in the distribution center

What is Slotting?

Slotting is the determination of product placement

within an area or fixture type in the distribution center

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Purpose of ProfilingThe following are goals for profiling a distribution

center. Profiling may be required prior to initiating a

slotting project IF the DC has storage deficiencies:

• Fixtures accommodate the mix of product handling

characteristics (weight, volume, etc)

• Mix of fixtures aligned with the storage volume and

SKU count managed by the DC operations

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• Fixture capacity allows for

existing plus % growth

• Aligned with mobile MHE

• Specialty needs addressed,

e.g. carpet, batteries, etc.

Purpose of SlottingSlotting product in a DC that has been correctly profiled is performed to achieve the following:

• Assign products to DC fixture locations based on volume velocity and other requirements

• Alignment of product picking locations with order profiles / types (DTS, DTC, B2B, flow-through, etc)

• Improve order selection efficiency by reducing travel times and improving picking productivity

• Grouping of product families by type or restrictions

• Improve fixture utilization by aligning the through-put volume with the number of facings required

• Provide an ‘intelligent’ location in the warehouse that supports overall goals and drive efficiencies

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The Case for Slotting

• Picking and shipping performance issues

• Excessive order processing time and labor costs

• Stock outs / replenishment issues

• Excessive travel required to complete orders; travel

paths that cross and back track

• Uneven work loads between workers and areas

• Load building inefficiencies at staging and packing

• Excessive handling of product at pack stations

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Does Your DC Have Any of the Following?

A Slotting Project Can Fix These and Save MONEY!

Slotting Benefits• Reduce labor costs from more efficient picking,

replenishment, and put-away activities

• Increase fulfillment velocity by aligning the products

with the order profiles commonly encountered

• Improve customer satisfaction, order fill rate

• Shorten travel path distanceso Reduce Costs of MHE Maintenance

o Reduce Non-value Added Time

• Reduce employee fatigue

• Increase productivity / quality

• Improve inventory turn over

• Improve fixture utilization

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Slotting Requirements

Slotting projects require some basic, accurate,

information to insure success and provide a good ROI:

• Item master data includingo Item or SKU along with description

o Handling units of measure (pallet, case, inner pack, eaches, etc)

o UOM dimensions (length, width, height), weights desirable but not needed

o Product families or restrictions (e.g. aerosols, chemicals vs. food, etc)

• Order data (order, date, item, quantity)

• Warehouse locations and inventory data

• Warehouse layout with dimensions

• Storage / pick fixture configuration and dimensions

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We Can Help Collect Data and Clean-up as Required

Models and Solutions*

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*Slot3D output examples

3D Model

Reports

Solutions & Output

Slotting as a Tool

• Slotting can be performed as a one time improvement but adopting a tool and establishing a process for periodic re-slotting as the business needs dictate will pay back higher ROI over time

• Most tools can be integrated into WMS solutions so directed work activity is created for the DC users.

• Frequency of re-slotting is dependent on business seasonality, SKU change over, promotions, and other changes in demand that impact the DC.

• The premier slotting tools optimize based on cost considerations, efficiencies, restrictions, and provide a model / result that helps visualize the changes.

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Keys to Success• Know your ‘end game’ before you start!

o Greenfield / Brownfield; What are you trying to achieve?

o Optimization and ‘What If’ Scenarios; Document your expectations

o Layout and Fixturing Validation / Optimization; Track the details

o Frequency and Alignment with Business Cycles / SKU turn-over; important!

o Clearly Define Restrictions / Constraints; align the model with reality

• Data and Baseline Accuracy is Paramount

• Identify Methods to Implement Slotting Changeso WMS Integration Points / Creating Directed Work

o Manual Reports – how best to utilize and communicate

o Process Steps / Validation – ensure a smooth transition and verify

o Involve the Team – educate and keep your team involved

o Pilot the Implementation – small steps rather than giant leaps!

• Measure the Impacto Compare results against baseline for key metrics and determine impact

o Adjust as necessary and repeat!

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How We Can Help

• Experienced and Dedicated Project Team

• Our Core Competencies & Solutions Deliver Value

• Independent Firm, We act in YOUR best interest!

• Excellence in Project Mgmt & Implementation

• Fully Integrated Project Team and Proven Processes

• We Deliver On-Time / On- Budget Results

• Respected by Vendors and Industry Peers

• 12+ Years of Service Excellence

• Continuously Exceeding Client’s Expectations

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Success Measurement

We are a results oriented consulting services firm. We

measure success based on the solution ROI, not just

deliverables!

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Contact Us for More Information:

Todd Kovi

Principal

561-246-2163

todd@koviconsulting.com