Optimize Warehouse Layout and Distribution Center Processes Goodwill Distribution Center Team 1, IE 4390 Spring 2015 Chandler Franklin, Alonso Garcia, Juan Garcia, and Kristen Kramer Faculty Advisor: Dr. Novoa Industry Advisor: Kelly Freeman

Project Goals 1. Improve Operations Efficiency 2. Live Inventory Tracking 3. Optimize Traffic Logistics 4. Optimize Dock Processes and Material Handling

Operations Efficiency

Logistics 16 Hour Working Days Truck Arrival Every 2 Hours, Fully loaded Boxes Tilted Into Table 900 tables/day Average Outlet Store Throughput Capacity 200 tables inside Outlet Store at once Left over material is sorted in Categories and stored in boxes in inventory until shipping Workers split into teams, complete tasks randomly

Process Constraints (Obtained from live time studies and industry advisors)

Arena Full Model

Model Assumptions One Month Worth of Manifest Data Used To Determine Box Size used percentages and amount of each type of material percentages. No Worker Downtime, No Machine Downtime

Simulation Report Longest Queues Formed at Tilters and Unloading Processes Caused by Outlet Store capacity

Simulation Report Average 891 Tables/Day Outlet Store Throughput Resembles Distribution Center Characteristics

Average Time In System With 95% confidence, the average time spent per box in the system before stored in inventory is between 8.9 and 10.7 hours.

Improvement Tables spend from 30 minutes to 2 hours maximum inside outlet store depending on material quality & popularity. Decrease in Average Time Spent in System by 9% C.I. 8.3 hours to 9.7 hours spent in system

Cost Analysis Cost per Box decreased by $0.15 Cumulative savings up to $4049.40 after 30 days

Recommendations Change the times tables spend inside retail store to 30 minutes for lower quality or less popular Materials. Keep a maximum of 2 hours for higher quality or more popular material types. Perform a study inside retail store to identify material popularity. Outcomes: Lower Average time spent in system per box Decrease processing costs Potential Increase in Sales inside retail store

Facility and Docking Layout

Docking Recommendations Implement cross-docking Prioritize trash and recycling processes Loading of trucks should be done with intent to unload (by category of inventory and/or container). Divide docks into groups of four; alternate designation of loading/unloading trucks every four docking stations.

Facility Layout Plastic, Nestable, and metal pallets should be implemented if they are cost-effective. Loose items can be secured using recycled materials, and loose cases can be secured onto pallets to eliminate inventory damage. Items should be stored by ‘popularity’. Storage depth should range from 2 to 3 depending on the items’ popularity.

Inventory Tracking System Wasp Inventory control $800-$5600 Stock added, removed, transferred, checked in or out, cost of inventory, inventory aging, transaction history, etc. Notification alerts when stock is low, ensuring that needed inventory is available on hand.

Truck Routing VRP solver used to find route trends Sort Manifest data by end location and find trends using Arena Input Analyzer. Use random number generator on Minitab to find random value in data fit. Use google maps to create from/to chart of each distance Use longitude and latitude in order to create a reference point for the GRC to the locations

Groupings found Dripping Springs Kyle Buda San Marcos Georgetown ----------------------------------------------------------------------------------------------------------------------------------------------------------------------- Georgetown Round Rock Wells Branch Pflugerville Sometimes Hutto, Norwood, & Scofield with that group. ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------- Bee Caves Marble Falls ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ Fredericksburg always alone Riverplace Cypress Band Balcones -------------------------------------------------------------------------------------------------------------------------------------------------- Southpark Meadow Brodie Oak Hill Marbridge Hut -------------------------------------------------------------------------------------------------------------------------------------------------------------------------- Bastrop Elgin Shadow Glen ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ Airport 10th Street Sometimes Lakeway Lakeway Lake Austin -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- Westbank only ever paired with South Lamar ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- South Lamar never alone, always changing groupings  

Routing Recommendations Goodwill should download VRP solver in order to plan routes based off demand ordered by the locations Drivers should fill out an excel sheet of items on manifest in order to find volume used. Goodwill can use this data to simulate different routes to prepare for the future.

Boxplot Time Interval Key Traffic Trends The GPS information we received allowed us to create boxplots to show trends in the times it takes to travel to the various locations. The plots are sorted by location from, location to, and time interval Boxplot Time Interval Key Times Interval 5:00 am - 7:00 am 1 7:00 am - 9:00 am 2 9:00 am - 11:00 am 3 11:00 am - 1:00 pm 4 1:00 pm - 3:00 pm 5 3:00 pm - 5:00 pm 6 7:00 pm - 9:00 pm 7 5:00 pm - 7:00 pm 8

Traffic Trends Location from Location to 5:00-7:00 am 7:00-9:00 am 9:00-11:00 am 11:00-1:00 pm 1:00-3:00 pm 3:00-5:00 pm 5:00-7:00 pm 7:00-9:00 pm 10th Street GRC   Airport Balcones Bastrop Bee Caves North Lamar Riverside Brodie Cedar Park Chimney Corners Cypress Bend Round Rock Dripping Springs Fredericksburg Georgetown Elgin Hutto Kyle Lake Austin Lakeway Macfarlane Marble Falls New Hope North Star Norwood Oak Hill Parmer Pflugerville Location from Location to 5:00-7:00 am 7:00-9:00 am 9:00-11:00 am 11:00-1:00 pm 1:00-3:00 pm 3:00-5:00 pm 5:00-7:00 pm 7:00-9:00 pm GRC Riverplace   Riverside Round Rock San Marcos Scofield Shadow Glen South Lamar Southpark Meadow Wells Branch West Bank Hutto Kyle Chimney Corners Lake Austin Lakeway Macfarlane Marble Falls Marbridge New Hope North Lamar North Star Airport Norwood Oak Hill Parmer Pflugerville 10th Street These charts show the different trends in traffic during the shown time intervals.

Acknowledgements This project is sponsored by Goodwill Industries with help from the following people: Leslie Bailey-Smith, LCSW Internship Program Coordinator Joseph Hnatow, Logistics Manager Ryan Schlickeisen, Inventory Analyst Kelly Freeman, Sustainability Director Allan Whitley, Sr. Director