What is Activity Profiling?

1. What is Activity Profiling? Warehouse Activity Profiling is the analysis of historical sales transaction data for the purposes of projecting warehouse activity and determining storage mode, physical layout, work flow processes, and labor and equipment requirements.

2. ORDER MASTER INV. MASTER Profiling Database Source Data ITEM MASTER Inventory Snapshots Average Inventory Levels Order Header Order Detail SKU Number Description Item Cube Pieces Per Case Cases Per Pallet Division Product Group Item Weight Item OrderedQtyUnit of Measure

3. STEP #2:ANALYZE (Sort / Rank) & PRESENT Developing Profiling Reports & Graphs InventoryMasterData OrderData STEP #1:CONSOLIDATE & CALCULATE ItemMasterData

4. How Do You Design a Warehouse? • Two Ways To Design a Warehouse • Storage Driven Approach via Cube Analysis • Picking Driven Approach via Order Analysis Storage Driven Picking Driven

5. What is the Storage Driven Approach to Design? Define Your Storage Zones Design Your Forward Pick Areas Define How You Will Plan & Pick Orders • PART I: • PART II: • PART III:

6. Designing a Warehouse Part I Define Your Storage Zones

7. Categorize Items By Cubic Ft of Inventory Calculate the cubic feet of storage that each item requires and then assign it to an “inventory container” of the appropriate size. Pallet Rack Bin Shelving Multi-PalletDrive In Rack Drawers .125 1.5 40.0 320.0 Cubic Feet of Storage Required For An Item

8. Drawers Develop an Inventory Container Graph Now you can begin to think about what storage modes might be reasonable candidates for the merchandise you are storing…

9. Develop a Pick Size Classification Scheme Next develop a classification scheme for picks based on the size of the pick. Usually designers will use pallet”, “case”, and “piece” pick sizes Piece Pick Case Pick Pallet Pick

10. Move these to Case Storage Piece PickActivityCurve Assess the Activity In Each Inventory Container Assess the activity in the larger containers to see if there is the possibility that some of the items should be moved to a forward pick area. The decision will be driven by the # of such picks in the container and the overall size of the larger container storage area.

11. Designing a Warehouse Reserve Areas Part II Define Your Forward Pick Areas Forward Pick Areas

12. General Process for Forward Pick Design • Questions that Must Be Answered About the Forward Pick Area(s): • How many forward pick areas do you need? • Determine how many SKUs should go on the pick line • Removing unusual SKUs from the pick line • Sequence the SKUs on each pick line

13. 80% of Picks from20% of Items These Items should go intoa forward pick area. You will likely have multiple forward pick areas For each Pick Size you need to decide if there are a lot of picks associated with a relatively small subset of the items. If so, you will likely want to set up a forward pick area for that Pick Size.

14. 100% 100% 80 80 60 60 40 40 20 20 0 0 20 40 60 80 100 120 140 160 % Case Picks Filled % Days Picked Determining How Many Items in Forward Pick Generally to determine how many items you are going to put in the forward pick area you look at the tradeoff between adding an item into the forward pick area and the % of additional orders you are then able to complete in that area. % Case Trade Off: Space Utilization and Efficiency Number of % Days Picks SKUs Picked Filled 20 33 99 30 46 97 40 52 95 50 67 93 60 73 92 70 79 90 80 81 83 90 84 79 100 88 68 110 92 63 120 92 52 130 95 44 140 98 33 Number of SKUs 150 98 25 160 100 22

15. Determining How Many Items in Forward Pick 90

16. Designing a Warehouse Part III Define How To Plan & Pick Orders

17. Wave Planning & Picking Approaches Daily Order Pool Orders of this “type” get released to the floor and picked in the following manner every X hours Orders of this “type” get released to the floor and picked in the following manner every Y hours While designers make assumptions at the start of a design about how the bulk of the orders will be released and picked, the details behind their thinking are not usually flushed out until the end of the project. They often also wait until the end to define the planning and picking approaches for the exceptional orders.

18. Forced UponYou By TheBusiness EfficiencyOpportunity Ways in which you can process orders differently • Order Selection Criteria & Groups • Rush vs Regular Orders • Geography (West Coast vs East Coast) • Orders Requiring Personalized Merchandise • Single vs Multi-Line Orders • Types of Picks Needed to Complete Order • Order Cube (Sm Pkg vs LTL vs TL)

19. Assess the Significance of Single Unit Orders Units/Order as a Percentage of Total Orders 45% of all Orders are single unit orders. One of the greatest opportunities to improve warehouse efficiency is choosing a different mechanism for picking single unit orders from multi-unit orders.

20. Assess the significance of grouping by area Reserve(Pallet)Area Orders Completed By Area Case Forward PickArea Piece Forward PickArea Orders that require merchandise coming from different storage areas within the warehouse may need to be picked differently.

21. Sorting Picks at End of Tour Order #1 Order #2 Deciding on a Picking Approach Single Order Picking Multi-Order Picking Batch Picking After the different groups of orders have been identified, the designer has to make a decision about how each group of orders will be picked.

22. Order #3 Order #2 Good candidates for Multi Order Picking Order #1 Multi-Order Picking Cart How Will Orders in Forward Pick Be Picked?

23. Deciding on a Picking Medium Label Picking Radio Frequency (RF) Barcode Picking Voice Picking For each picking approach you need to decide on a mechanism for how picks will be communicated to pickers. Pick To Light

24. How Do You Plan & Pick Different Orders Order Group Pick Method Pick Medium Small Cube Multi-Line Orders Multi-Order Picking RF Terminals Single Line Orders Batch Picking Labels

25. Summary of Warehouse Design Process Define Your Storage Zones Design Your Forward Pick Areas Define How You Will Plan & Pick Orders • PART I: • PART II: • PART III:

26. Observations • Every descriptive tool or technique seems to be based on a specific “need” • Profiling/design is less about “describing” an “as is” warehouse, than about saying how it “should have been” • It’s hard to integrate the different descriptive tools and techniques • Can we build a comprehensive, computational “description” from which all the different “needs” can be met?

27. Schema Process Reference Model Domain Model Instance

28. AMPL, AIMS, GAMS, and other “modeling languages” incorporate a reference model for the domain of optimization models, and are used to create instances of optimization models.

29. Can reference models be developed for the domain of discrete event logistics systems, or for subsets of the domain, e.g., warehouses, factories, and supply chains?