Warehouse Layout Analysis for Ferro Electronics

By

Roberto E. Estrada

Rajan Batta

Rakesh Nagi

April 13, 2001

Contents

• Motivation

• Current Situation

• Data Collection

• Alternatives

• Recommended Alternatives

• Suggestions on Implementation

• Suggestions on Racks/Trucks

• Acknowledgements

• References

Motivation

• Lease on “other” warehouse expiring

• Additional manufacturing space needed

• Improve organization of materials

• Improve utilization of space

Current Layout

• Area A—finished goods ceramic division– 17 rows– Door walkway– 36 more rows– Each row fits 10 pallets deep on ground

Current Layout…

• Areas B and C—center of warehouse– Divided into two sides– Each side has 31 rows– Each row can hold 7 or 8 pallets deep

• Area D—WIP from Electronics division– 18 rows, door walkway, 38 more rows– 10 pallets deep on ground in each row

Current Layout…

• Area E—3 rows of 10 pallets each– Mostly products that are to be shipped soon

• Area F—each end of warehouse– Fits 30 rows– First 20 rows—8 pallets deep on ground– Remaining rows used half deep– Mostly raw material stored

Current Layout…

• Areas G1, G2 and G3 have four ground spaces each

• Racks PR1-PR4 hold several products– Organized in 43”X36” pallets– Mostly finished products in totes and paper

bags

• New Rack—144 spaces

Current Layout…

• Total of 4804 pallet spaces

• An additional 585 pallets will be transferred to the warehouse

Data Collection

• Dimensions of warehouse

• Current forklift trucks used

• Required aisle width

• Dimensions of current racks

• Dimensions of materials to be stored

• Average holding quantities of raw materials, WIP and finished products

Data Collection…

• Information also gathered on:– Available push-back racks– Available fork-lift trucks

Alternatives

• Three models were initially generated.

• Model 1: Places aisles length wise – Narrow aisles so turret truck is needed– Able to view warehouse from front (safety

advantage)– Capacity: 5446 pallets

Alternatives…

• Model 2:– Makes use of current racks– Places racks longwise on one side– Horizontal on other side– 3 deep racks for pallets– Makes necessary the use of a turret rack– Capacity: 5185 pallets

Alternatives…

• Model 3:– Places one central aisle longwise– Either side has racks with various pallet depths– Uses narrow aisles– Capacity: 6208 pallets

New Alternative

• Use current racks

• Rack material that is currently stored at 1 or 2 pallets high

• Leave 600 rack spaces for WIP; 200 in single racks, 400 in 3 and 4 deep racks

• Leave 30 long rows (10 deep) for 8.5 gallon and 6.5 gallon drums for ground storage

New Alternative…

• Place rack along end side of warehouse

• Currently there are 5 rows of 4000 lbs totes, at 2 high.

• Leave 100 rack spaces for these (wide; 52”)

• 6 more specific requirements

Recommended Alternative

• Model 4A:– Capacity is 5268 pallets– Uses narrow aisles (Turret forklift)

• Model 4B:– 13 feet wide aisles (regular forklift)– Capacity is 4963 pallets

Is new truck justified?

• Cost of turret truck is $75,000

• Get 305 pallets extra

• Work out economics based on cost of leased space

Suggestions on Implementation

• Requires a careful and graduated plan

• When one area is being re-racked the material needs to be temporarily stored

• Installation needs to be done from the rear of the building

• Revised practices in storage

Suggestions on Racks and Forklift Trucks

• Cost per rack space=$125

• Model 4A: $343,750 + turret forklift ($75K)

• Model 4B: $315,250

Acknowledgments

• Close contact with company personnel

• Special thanks to company main contact (kept minutes) and person whom we got data from

• Weekly meetings

References

• Tompkins, White,…, Facilities Planning, Wiley (1996).

• Tompkins and Smith (eds.), The Warehouse Management Handbook, McGraw Hill (1998).