1. Warehouse Layout Analysis for Ferro Electronics By Roberto E. Estrada Rajan Batta Rakesh Nagi April 13, 2001

2. Contents Motivation Current Situation Data Collection Alternatives Recommended Alternatives Suggestions on Implementation Suggestions on Racks/Trucks Acknowledgements References

3. Motivation Lease on “other” warehouse expiring Additional manufacturing space needed Improve organization of materials Improve utilization of space

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

5. 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

6. 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

7. 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

8. Current Layout… Total of 4804 pallet spaces An additional 585 pallets will be transferred to the warehouse

9. 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

10. Data Collection… Information also gathered on: –Available push-back racks –Available fork-lift trucks

11. 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

12. 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

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

14. 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

15. 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

16. 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

17. Is new truck justified? Cost of turret truck is $75,000 Get 305 pallets extra Work out economics based on cost of leased space

18. 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

19. Suggestions on Racks and Forklift Trucks Cost per rack space=$125 Model 4A: $343,750 + turret forklift ($75K) Model 4B: $315,250

20. Acknowledgments Close contact with company personnel Special thanks to company main contact (kept minutes) and person whom we got data from Weekly meetings

21. References Tompkins, White,…, Facilities Planning, Wiley (1996). Tompkins and Smith (eds.), The Warehouse Management Handbook, McGraw Hill (1998).