Cold Collaboration: Customized Logistics In A Refrigerated Warehouse

Alpha Baking Co. and Frozen Asset Cold Storage partnered with Konstant to design a high-rise warehouse.


Many automated material handling systems can deliver solid, incremental improvements in warehouse efficiency, accuracy and space utilization.

Then there are the installations that are real game-changers.

This was the case when Alpha Baking Co. partnered with Frozen Assets Cold Storage, a Chicago-based third-party logistics provider (3PL), to develop a dedicated facility for handling distribution of its frozen bakery products. Driven by a need for both speed and storage density, the pair turned to Konstant and their Pallet Runner system to handle put away, storage and retrieval of Alpha’s high volume movers.

Pallet Runner is a highly customized, individually configurable system that combines high-density racking with automated, remote controlled carts to take over most of the work of shuttling pallets in and out of storage. The system was developed and is manufactured by Konstant of Rolling Meadows, IL and Oakville, Ontario.

By incorporating the Pallet Runner system, Frozen Assets and Alpha Baking were able to design a high-rise distribution center that accommodates more than 8,000 pallet positions in just 41,000 square feet of freezer space.

Not only did Pallet Runner provide the storage density required it also yielded dramatic reductions in labor, warehouse equipment and other direct operating costs. It generates significant energy savings as well. Perhaps more importantly, Pallet Runner has facilitated a dramatic acceleration of transport service and turnaround time thereby winning accolades from Alpha’s customers and the contract carriers who service them.

ACCOMMODATING RAPID GROWTH

A privately owned commercial bakery with four production facilities in Chicago, La Porte, IN, and Manitowoc, WI, Alpha Baking began utilizing Frozen Assets for its cold storage and distribution operations a little over a year after the 3PL first opened its doors in 2004.

With sales of frozen product lines expanding rapidly over the last 10 years, and freezer operations consequently becoming more critical, Alpha decided it could no longer rely on public cold storage warehouses, notes Bob McGuire, vice president of logistics.

“Their typical Monday through Friday work week did not line up well with the requirements of our seven-day-a-week operations,” he explains.

Founded on a business model that focuses on providing customers with separate warehouse “condos” and dedicated staff in its Chicago facility, Frozen Assets offered Alpha the control and flexibility it needed, McGuire says, obviating the need to build and operate its own distribution center.

As frozen sales continued to grow by leaps and bounds, however, the number of pallet positions required by Alpha more than doubled in less than two years. As a result, some product began to spill over from its dedicated area at Frozen Assets into the public cold storage side of the 3PL’s facility; particularly during peak sales periods and pre-season builds. The need to pull product from multiple locations inside the warehouse negatively impacted the efficiencies and speed of service the bakery company had originally sought and achieved by outsourcing its frozen distribution with Frozen Assets.

In 2007 the two companies agreed to jointly develop a new, wholly dedicated frozen distribution center for Alpha, adjacent to Frozen Assets’ existing warehouse. Both companies were willing and ready to sign a 10-year commitment to this relationship. The big challenge they faced, however, was an extremely constrained space available for construction next to Frozen Assets’ original, 250,000-square-foot facility; right in the city of Chicago. Somehow, on a lot totaling less than two acres, Frozen Assets needed to find room for a distribution center that would accommodate 8,300 pallet positions, all 96 inches high, as well as a dock with 15 doors, miscellaneous staging, maintenance area and office space.

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