“The OPM delivers the biggest bang for the buck in terms of manpower reduction,” says Chris DeLisle, a senior engineer at Witron. “But there are a number of benefits that are often overlooked—and yet just as important. Delivering store-friendly pallets helps increase labor and efficiency savings at the store. Then there’s a transportation savings because they’re building a denser pallet so they generate more cube on the same trailer.”
Vimard reports that Sobeys is getting about eight percent to 10 percent more product on a pallet. “And the pallet is built so straight that the first time we opened a truck using automation, everyone was astounded,” he says. “The pallets didn’t fall all over the truck and there was no product damage.”
According to DeLisle, other benefits include lower case damage, lower mispicks and better inventory control, as well as human resource paybacks, such as a reduction of injury claims. “We find that employee retention improves as well,” says DeLisle. “Employees say their job satisfaction is much higher because they’re engaged in something they find stimulating—their work environment is now computers instead of boxes, so we find a lot less turnover in the warehouse.”
Room For Growth
With the Vaughan DC in operation for a little more than a year, Sobeys has realized impressive results. Case-handling costs have decreased by more than 50 percent and order accuracy rates by nearly 100 percent. In addition, damages have decreased, transportation savings have increased and the cycle time to process an order has shortened.
Vimard points out that success would not have been possible without the engagement of the company’s management team and employees.
The retailer built the DC larger than it needed to and designed the automation so that it can increase capacity by 50 percent if necessary. Vimard says it’s sustainable for up to 25 years and anticipates that it will handle volume for existing stores as well as new stores.
“With this type of DC, you have invested as much on the automation as you have invested in the building itself—and that’s a big bet,” says Vimard. “And you have to understand your business as well as you can when you’re making the bet. But I’m confident that we’ll get a payback that meets or exceeds our expectations.”
Sobeys has partnered with Witron to run the facility. Witron has personnel on site to operate and maintain the technology while Sobeys employees handle the shipping and receiving.
“Our employees have really embraced the technology,” says Vimard. “We are providing new tools that enable them to get the job done well, while improving levels of performance. The benefits to our vendors, to Sobeys as a corporate entity, to the retail stores and ultimately to our customers have been enormous.”