Slotting optimization project enables leather goods manufacturer to better serve Walmart
Research Triangle Park, N.C., September 23, 2010 Optricity, supply chain optimization software innovator and provider, unveiled its slotting case study of leather apparel and accessories manufacturer, Tandy Brands, at the 9th annual North Texas WERCouncil Warehousing Resource Convention in Grapevine, TX. Using OptiSlot DC™, Optricity’s best of breed slotting technology software, Tandy completed an optimization project that yielded precise end customer product grouping, sweet zone slotting within each end customer product group, and reduction in replenishment frequency. Additionally, enhanced capacity utilization reduced Tandy’s expected slot consumption, thereby freeing up slots for use by other product groups and other end customers.
Supply Chain consulting firm, TranSystems Corporation, managed the final design and implementation of the Tandy warehouse expansion project. The profiling and slotting portion, including data collection and correction, was completed by Optricity in approximately two calendar weeks. This optimization effort resulted in Tandy’s ability to group all Walmart product together. Within each product grouping, sweet zone slotting could be performed based on movement velocity. Furthermore, using the velocity values allowed for the determination of periods in pickslot, which established replenishment goals that were ultimately achieved for 92% of the items. Finally, this optimization project showed that Tandy could reconfigure its racks to use only five-high racks; this change to standard and uniform racks allowed for more flexibility in the future. “Through the use of OptiSlot’s weighted goal and constraint system, Tandy was able to find the optimal balance between the competing objectives of product grouping for the customer benefit, replenishment labor, and picking labor,” said Tim Riehl, VP of Services for Optricity.
Prior to the launch of this warehouse optimization project, Tandy utilized two primary warehouses: a facility in Dallas, TX, that primarily distributed women’s belts and accessories, and a facility in Yoakum, TX, which handled distribution of men’s and women’s Walmart belts, and men’s belts and accessories for additional customers. A logistics study determined that Tandy could save $3.4 million per year in labor, freight, and facility costs by using a single facility in Dallas; thus the Dallas facility was expanded by 60,000 square feet, and Tandy initiated the effort to eliminate the Yoakum facility. TranSystems managed this challenging transition, which required both profiling to identify the right configuration of storage fixtures, and slotting to locate products in the optimum locations.
Ultimately, Tandy knew it needed to utilize an advanced software solution in order to properly slot the expanded warehouse area, determine the net-benefit associated with slotting by end customer product groups − like those required by Walmart − versus strict velocity slotting, and reduce replenishment activity. Norm Saenz, Vice President with TranSystems, comments, “To support our clients with slotting it was crucial to work with a slotting package that supported the detailed elements of slotting. Optricity’s focus and commitment to developing optimization software was the right solution for TranSystems and its clients.”
TranSystems is a Supply Chain Consulting, A/E Design, Security and Site Selection company with 1,000 professionals and 40 offices nationwide. Within the Supply Chain line of business TranSystems has over 150 professionals that provide material handling/storage solutions, layout/space planning, labor standards development, product slotting, technology evaluations, software selection & integration, logistics network / transportation analysis and other supply chain related consulting services. TranSystems owns the OptiSlot annual license and has trained 3 industrial engineers on using the program. TranSystems has used the tool to implement the Wal-Mart business for an apparel client, selected equipment and performed slotting for a paper distributor and is planning on using the tool for a sports supply distributor.
Optricity, a software development company, specializes in solving complex Supply Chain (SC) optimization problems. Optricity solutions minimize operational costs at SC junctures where customer’s competing goals and constraints come together. Using patent-pending RASSQ™ optimization engines, Optricity’s best-of-breed solutions easily integrate with existing warehouse management and planning systems. Visit www.Optricity.com to learn more about the advanced, warehouse slotting optimization tool, OptiSlot™, RASSQ optimization and other Juncture Optimization™ capabilities.
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