JTM's switch from manual cold storage warehousing to an AS/RS significantly cut costs.
The vast majority of cold storage warehouses in the United States are large, cavernous buildings with ceilings 20 feet high and multiple 12-foot-wide aisles with fork trucks riding in and out of them moving product up and down from the racks.
Compared to non-freezer facilities, cold storage warehouses have a higher incidence of product damage, missed product rotation and wrong item fulfillment. They also have heightened facility and equipment damage, primarily caused from fort lifts impacting racks and doors, significantly higher than what is found in non-freezers. Personnel turnover in cold storage facilities is also higher than in non-freezer warehouses.
Cold storage warehouses pose definite challenges to operations and logistics managers who endeavor to have facilities operating at a high level of efficiency. Where a 99th percentile inventory and fulfillment accuracy rate could be expected in a non-freezer warehouse, it becomes patently unrealistic at 10 degrees F below zero. That is, unless the warehouse has an automated storage and retrieval system in place.
An automated storage and retrieval system (AS/RS) is a computer-controlled system for automatically depositing, inventorying and retrieving loads from defined storage locations. It allows inventory to be moved quickly, safely and precisely in a warehouse environment. When applied to a sub-zero warehouse, AS/RS produces dramatic results, effectively making the cold storage facility as efficient as an automated non-freezer warehouse.
In addition, in a typical cold storage warehouse where fork lifts are used, the lift’s maximum reach is around 20 feet, allowing about four vertical pallet positions for a maximum 20-foot rack height. With an AS/RS facility, it is common to have as many as 12 vertical pallet positions on 80-foot racks and higher.
In a non-freezer warehouse this is an important efficiency factor in footprint consolidation. In a cold storage warehouse, the footprint reduction becomes an absolutely critical factor in energy savings since much of the heat gain occurs in the roof.
In effect, cold storage warehouses are giant insulated freezers which extract heat to produce a cold environment. The removal of heat comes at a hefty energy cost, and incidentally, significantly more than what it takes to put heat into a space. Since most heat gain occurs through the roof, having a smaller roof footprint from a cold storage warehouse presents a better energy solution.
It can handle the same number of pallets, but in a smaller footprint. A cold storage facility with an AS/RS could reduce energy costs to one-third of that needed for a manual facility. Such was the case with JTM Food Group, which switched from a manual cold storage facility to one operated with an AS/RS.
JTM GOES WITH AS/RS
JTM Food Group, located in Harrison, OH, is a family-owned food processor producing such products as meat balls, sausage links, Angus beef chili and hoagie buns. All of the company’s products are cooked, packaged and distributed from its own plant.
Since the late 1960s, when the company first operated as a modest retail meat shop in Cincinnati, it has grown into a prominent meat processor with sales exceeding $72 million in 2007. JTM’s plant runs a kettle cooking line, a grind and form line and a bakery line within its facility, operating as a specialty manufacturer of more than 1,000 items. One hundred percent of what JTM sells is frozen. Fifty percent of the company’s products go to school lunch programs while 35 percent of its sales go to restaurants, and 15 percent of its products go to supermarkets and grocery stores as packaged products for shelf sales.
To handle this huge product volume, JTM constructed a 20,000 square-foot, minus 10 degrees F, cold storage warehouse with 10,000 high-bay pallet locations serviced by an AS/RS. But like most other meat processors inventorying frozen product, JTM struggled for many years with the limitations of inefficient cold storage facilities.