As Supply Chain experts we often get calls from potential clients stating that they just leased or purchased new distribution and/or manufacturing space and need our assistance in designing their new operation. This is very disappointing as the building is part of the tool and is just as important in driving efficiency and reducing costs as process, equipment, and staff. Building size and shape, dock size and placement, column spacing, and ceiling heights not only will have a major impact on the quality of and cost of running an operation, but are permanent and cannot be changed like a process or piece of equipment. The correct sequence is to design the new operation first, even if only on a high level and in the context of planned growth, and then look for the facility that best supports the operation.
Facility Size – the proper size can only be known once system and equipment requirements have been determined and a layout has been created.
If the facility taken is too small, outside space will be required or aisles and docks may be blocked.
If the facility is too large money will be wasted on unneeded space and most companies will find a way to fill the space which will result in added inefficiency and increased labor and equipment costs as well as the cost of the space.Facility Configuration – buildings are typically rectangular, square, or L shaped.
Rectangular buildings typically support manufacturing operations well as materials can move continually from receipt to raw material storage to manufacturing to finished product storage to staging or shipping in the long direction. Distribution operations typically require shorter travel distances and a long building could add to travel time and related costs.
A square shape in a manufacturing operation could force material to have to double back and forth because there is not enough length to support continuous travel. Distribution operations when laid out properly in a square building will result in shorter travel distances for the round trip from dock to storage to dock.
If you encounter an L shaped building it is even more important to determine if it can support or it will restrain operations.
Docks – We find that most companies tend to underestimate dock requirements when looking for a new facility because docks are not used for storage or production and they often “look empty.
Proper receiving and shipping growth projections often are not considered in dock requirement planning. Dock placement will have a serious impact on operational efficiency and facility throughput subject to the type of operation.If dock size is underestimated whether for receiving or shipping, it is only a matter of time before product will be blocking storage aisles.
If dock size is overestimated money will be spent for space that is not needed. If docks are situated on opposite sides of the building a manufacturing process can begin on one side and flow continuously with product being shipped from the other side of the building without doubling back to dock doors on one side of a building only. If docks are situated on one side of the building fastest moving product can be stored closest to the dock and slowest moving product furthest so the most frequent round trips are the shortest ones for a distribution operation.
If docks are situated on opposite sides of the building all product will have to travel the length of the building from receiving to storage to shipping no matter how frequently a given product is shipped increasing costs.Column Spacing – Subject to the layout, column spacing can be a major problem.
If one requires a narrow or very narrow aisle rack configuration, and the column spacing does not support the requirement, aisles may have to be widened unnecessarily so columns do not block the aisles which results in reduced storage capacity. We’ve encountered situations where columns block conveyor paths and extra expense was required and delays encountered to bypass the column and/or the layout had to be changed. It is essential to know favorable and unfavorable column spacing is before searching for a building.Ceiling Heights – This is an area where subtle differences can have large implications.
Slightly too short could result in losing a storage level and therefore requiring more space or creating different height storage openings and having to remove a layer of cartons to replenish a pick location. It could mean not being able to mezzanine above a short height operational area and running out of space sooner than necessary.
Taller buildings may have a cost premium and if you don’t need extra height based on operational requirements, why pay the premium? A taller building however could provide future growth by going higher later and therefore allowing the acquisition of less square feet and lower costs.I want to know my pallet heights and desired number of storage levels and any other key metrics beforehand and then select the correct building to support the operation and layout. Of course there are possible exceptions to the general rules stated above which is even more reason that a proper study should be performed before beginning the search for a new facility.
If you really want a good fit, it is important that you contact a Supply Chain expert prior to the facility selection in order that we can optimize your efficiency over the length of the lease. Recently, I spoke to a client who complained about excessive transportation cost, I asked him if his company was growing according to forecast and he agreed that it was, however, he now had 3 buildings approximately 15 miles from each other and was constantly transporting inventory to have it in the proper place at the proper time. There is a good chance this could be avoided if we had been contacted in the beginning prior to the site selection.
If your company is considering a new facility; I would suggest you contact Supply Chain Experts, they can help you with your future needs analysis, writing request for proposal, software design and/or selection, and an implementation program that will optimize operational performance and satisfy the requirements of your customers.
Dr. Edward F. Knab
Productivity Constructs, Inc.
800 660 8718 office
949 413 7333 mobile
ed@edwardknab.com
www.productivityconstructs.com
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Dr. Knab is an academic practitioner and seasoned Global Supply Chain expert whose company, Productivity Constructs, is focused on driving cost and inefficiency out of the Global Supply Chain. Dr. Knab can be contacted for speaking engagements, coaching, or consultation at efk@productivityconstructs.com, ed@ewardknab.com or www.edwardknab.com.
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