Volume Movers
When Ritz meets with his clients, one of his early tasks is figuring out which are the yard’s fastest-moving SKUs so that he can design an improved racking structure around families of products. “It can be that simple,” he says. “Make sure a logical flow is there and you leave room for forklifts to pass.”
“It’s the same principle as end caps,” adds Ruth Kellick-Grubbs, president of Kellick & Associates, a supply chain consultancy in Tryon, N.C. “Putting your big movers close to the front of the yard saves physical steps, too.” She does warn that product grouping by sales volume (aka frequency stocking) will disrupt the traditional alphanumeric organization.
Rick Hogue, vice president of marketing at Krauter Storage Systems, Indianapolis, suggests creating a horseshoe-shaped area near the front that’s lined with faster-turning items like concrete. That makes it possible for customers to grab just what they are most likely to need and leave quickly. Finished goods belong near the end of the loop and therefore on top of the load, the better to keep concrete from destroying them in transit. (For more design ideas, see “Five in One,” page 50). Other innovative yards have begun organizing their materials in reverse order of how a house is built.
Stacks and Racks
When H & S Lumber’s 10-acre yard burned down in 1992, the Charlotte, N.C., business had to move its inventory to a secondary location: a mere acre of land that already had a 20,000-square-foot warehouse built on it, leaving just a half-acre for yard stock. Today, general manager Rick Paris has to juggle several thousand SKUs in this postage stamp?sized facility; to say space is tight is an understatement. “Our yard is very organized and our housekeeping has to be perfect,” Paris says. “We can’t have a little messy corner because we need that corner.”
According to Hogue, progressive companies with space-challenged yards are installing rack systems that go base plus three and sometimes four levels high. Base plus three should be the limit, however; building skyscrapers means staff can no longer conveniently reach their goods without specialized equipment, and OSHA safety rules make the arrangement truly ugly.
Hogue also gives props to crating systems that sidestep unloading a truck onto a rack. “We want to see if an order can be loaded right from a semi onto a cart and that entire cart taken to the jobsite without being touched,” Hogue says. “The more you handle doors, windows, and such, the more you risk damaging them.”
Technical Assistance
Technology can be a true friend in this situation, says Mary Ann Von Bank, marketing manager of Activant Solutions’ Falcon enterprise resource planning tool. Because inventory management systems can assign location codes to products, when a customer places an order, the receipt can be set up to print out in order of the products’ locations. The strategy minimizes the possibility of forklifts running willy-nilly around the yard and cuts down on equipment wear and tear no matter how you organize.
Handheld devices enable employees to scan the product and register the quantity in the system in seconds. No bar codes are used at this stage in the game; one simply counts and enters the final number into a PDA-like hand tool. Some of Von Bank’s clients report the equipment has reduced their cycle count times by half versus what it would take to record the quantities via paper and re-enter them at the main office.
The bar code system eventually will infiltrate the lumberyard niche, Kellick-Grubbs assures, if only because this common system claims a 99% accuracy in other retail industries.
Surprisingly, Johnson is not one of the early adopters on this front; he continues to conduct all his inventory counts manually but tabulates and measures the results electronically. “We need the entire industry to embrace bar-coding,” he explains. “Technology doesn’t start at the beginning of the supply chain, so it’s very difficult for us to add that halfway through.” Still, he predicts the changeover will stem from action on the lumberyard dealers’ demand rather than the suppliers’ initiative. “The suppliers are selling material, and whether we lose it or sell it once it gets to us is our problem,” Johnson says. (For more on bar code use in the LBM industry, see page 24, and on how manufacturers are leveraging this technology, see the pullout section following page 28.)
