Choosing Equipment to Handle E-Commerce Demands: How manufacturers can invest wisely to keep up with their changing environment

xtra_main_2cModern Materials Handling (MMH) recently discussed the results of Peerless Research Group’s 2017 Warehouse/DC Equipment Survey. The results revealed that the industry is spending and planning to spend on solutions that improve flexibility and efficiency. This was especially true for companies that felt stress from: faster cycle times, smaller, more frequent orders, and labor pressures.

Put more generally, the push to spend more on automated materials handling solutions and related software systems comes from the dominance of e-commerce. Norm Saenz, technology director at St. Onge Company, is quoted in the MMH article:

“Many of the retail industry DCs weren’t designed to deal with e-commerce-size orders, so you just can’t get those orders out of the building very effectively without investing in new material handling equipment of some kind, or in information technology systems.”

Indeed, material handling equipment and IS solutions are where the survey respondents indicated that they either had spent or plan to spend (or both) a significant amount. 43% indicated that they have a pre-approved budget for materials handling for 2017; the average budget is over $422,000; 23% of respondents have budgets over $1 million.

Managers should carefully choose new equipment and systems, ideally to fit in with some sort of other management strategy, like a lean model. For example, performing value stream mapping (VSM) outlines the entire facility so that it’s easy to recognize inefficient practices. With the right Lean strategy, you can also uncover ways to improve productivity without spending money. By identifying the greatest opportunities for improvement, a company can spend wisely, yielding the most productivity and the best ROI.

The 2017 survey does reflect that managers favor Lean and similar models as best practices. For material handling, strategies that were most frequently identified were:

  • Lean
  • Just-in-sequence production
  • Continuous improvement
  • Labor management

What’s interesting about this survey is that while it reflects an effort to be more efficient, the respondents also indicated that they’re buying more lift trucks. Forklifts are necessary for vertical movement, but there is probably a more efficient (and cheaper) way to accomplish horizontal movement.

Motorized tugs quickly attach to just about anything on wheels. They’re operated by one person who needs no certification. That operator can effortlessly move thousands of pounds around a facility with full visibility and no strain. The tug and cart system multiplies the potential load size that can be moved at one time almost indefinitely over what a forklift can move. Additionally, the energy and maintenance required for a motorized tug is a fraction of what is needed for a forklift.

Overall, companies that are investing in equipment should A) use a system (like VSM) to identify what equipment will be most beneficial, and B) investigate all the options for equipment that will accomplish the goal. To learn more about motorized tugs and their applications, contact Load Mover Inc. We understand the industry as well as lean and can help you determine whether a tug would make the most sense for you: 952-767-1720 or