Special features of warehouse automation in the automotive sector

Developments in the Ukrainian automotive industry

The global situation (economic crisis, military conflicts, pandemics, shortage of semiconductors) shows that most consumers are more willing to have cars repaired than to buy new ones. As a result, the lifespan of cars is increasing. The average age of a vehicle on the road today is 11.4 years. In 2000, this figure was still 8.9 years (Source: https://autotrends.org/ihs-automotive/). Many consumers need spare parts, some of which are no longer manufactured. Therefore, in addition to the spare parts for new cars that are produced every year, the spare parts warehouse must also keep spare parts for older car brands in stock. Added to this is the constantly evolving technology, which makes the market for car maintenance and repair even more challenging. This leads to a constant increase in the number of SKUs in the dealer’s stock. In Ukraine, for example, spare parts warehouses have an average of 100,000 spare parts units (SKUs) to fully cover the needs of car repair shops and dealers.

The main characteristics of spare parts warehouses are

• a huge range, which requires a large number of different storage locations for spare parts;
• an enormous variety of sizes – from millimetres to truck bodies and cabs;
• a variety of packaging types and shapes;
• the complexity of labelling – due to the dimensions;
• a wide range in terms of storage time (some parts may be in storage for years before being delivered to a customer – dealer, garage, etc.). – etc.);
• specificities of storing fuels and lubricants;
• speed of order processing (assembly and delivery);
• orders with a small number of items (SKUs). There are high costs for the manual labour of employees in the picking process. This leads to a high share of labour costs in the total costs of production;
• that the principles and technologies for picking in spare parts warehouses are similar to those in e-commerce: single-line orders are picked separately and goods from multi-line orders are assembled in a single storage compartment, with further sorting of goods by order;
• quality control when receiving and processing returns from car dealerships/repair shops.

Do all spare parts warehouses need automation?

There is a certain benchmark for when automation should be introduced in a spare parts warehouse. As turnover increases, the efficiency of a non-automated warehouse decreases. The number of employees required to handle an increasing number of orders increases exponentially. Then it is time to automate the warehouse, even if it represents a high investment. The payback period of the investment and the possibility of a gradual introduction should be taken into account.

Automation makes sense when:

• the company is in a growth phase (e.g. market share or customer expansion) and is planning concrete measures to increase delivery quantities;
• the warehouse no longer meets the requirements for goods flow and storage space;
• there is a shortage of labour on the labour market;
• wages and production costs are rising;
• the order structure has increased by over 60% from 1-2 to 5 lines per order;
• meeting delivery times is crucial to ensure turnover.

Requirements for the automation of a spare parts warehouse

Depending on the customer’s objectives, a single warehouse process should be automated, e.g. goods receiving or packing of spare parts, or a complete solution for all processes should be developed. If only one process is to be automated, it should be analysed in detail. In the case of a comprehensive automation of a spare parts warehouse, all these aspects should be considered:

1. Type of spare parts warehouse – temporary warehouse, U-shaped warehouse, etc;
2. Degree of automation;
3. What operations are carried out in each area of the spare parts warehouse?
4. Number of individual items in the warehouse and their stock levels;
5. Dimensions of the goods;
6. Specifics of the storage of car parts;
7. Frequency of processing of each SKU type;
8. Type and volume of orders in terms of lines, quantities and weight;
9. Type of packaging of auto parts;
10. Number of auto parts delivery routes, departure schedules, number of service points, shipping volume (to develop a system for storing and sorting packaged goods);
11. Specifics of car parts shipping;
12. Handling of returns.

Special features of the storage of spare parts in the warehouse

The constant increase in items leads to an increase in storage space. Since storage space is limited, spare parts warehouses are increasing their storage capacity. From conventional storage on frontal pallet and shelving racks, there is a switch to storage systems with higher storage quantities per square metre of storage space. These include metal construction warehouses (mezzanine), automated storage systems (shuttle systems, miniload) and flow storage racks. Special storage conditions are often required in accordance with official regulations – this applies to liquids, chemicals, corrosive substances and batteries. In warehouses, it may be necessary to install sprinkler systems in the racks and to train warehouse staff specifically for the proper handling and packaging of these goods.

Fast handling of small orders for spare parts

A significant percentage of the turnover in the spare parts warehouse is accounted for by orders from private individuals and workshops. As a rule, these are small orders (number of lines – up to 2) that have to be delivered directly. Such orders are given a special status in the ERP and are transferred to the WMS with an URGENT flag. They are given a higher priority than the SNS order (today for tomorrow) so that they can be assembled, packed and shipped to the customer as quickly as possible by in-house or contracted courier services. Most clients want to know an approximate or guaranteed delivery time and are willing to pay more for faster delivery. Therefore, delivery time is one of the most important aspects when choosing a company to deliver spare parts. A+ and A-rated products are allocated a separate area in the warehouse (referred to as “stock in stock”). Such goods are placed closer to the shipping area – for faster processing and packaging.

Reduction of personnel costs and minimisation of errors in order processing

Automation of warehouses in the automotive industry is at its peak as the industry strives to fulfil orders with minimal costs and error rates. The automotive industry can be considered a pioneer in automation, as new technologies are being tested in these warehouses due to the need for flexibility and constant scalability. Warehouse automation is implemented in a variety of ways, including the use of conveyors, industrial robots, cranes, shuttle systems, AGV machines and sortation systems, to optimise the activity of employees in all processes – from goods receipt in the warehouse to delivery to the client. This increases efficiency and accuracy while reducing labour costs and errors. Errors in spare parts warehouses are very costly. Therefore, careful monitoring of each return by staff is needed. Errors can be caused by inexperienced staff in the warehouse and wrong orders from the workshop or the customer. So it is almost impossible to reduce errors in the warehouse to zero, but it is possible to minimise them.

Automation steps of warehouses in the automotive industry according to the concept of KAPELOU

First, the customer provides the necessary data for a comprehensive analysis. This is followed by calculations (taking growth forecasts into account), the creation of a “traffic flow chart”, calculations on the number and type of storage locations and the reconciliation of the figures.

The second stage is the design of the automation system: drawing of the plant; calculation of the performance of the whole system in relation to the required quantities. In this phase we use traffic modeling systems – for the calculation of bottlenecks.
The third step is the coordination with the customer.

The fourth step is the calculation of labor costs and the number of employees and equipment in the warehouse.
The next steps include 3D modeling of the project, calculating the cost of the equipment, the time of installation, commissioning and the payback period of the investment.

Then follows a detailed description of the measures – processes, work areas, description of the equipment and the functioning of the IT systems. This is followed by project management and its implementation: production, procurement of components, installation and commissioning. We also work with clients to implement WMS.

The final phase is technical support for the operation of the equipment.

The phases of the project development for a spare parts warehouse and the adjustments during the implementation (a practical example)

The clients turned to us as part of the construction of a new warehouse. After careful analysis of all data, we created a concept for the warehouse operation and agreed it with the customer. KAPELOU experts worked on the concept while the customer was still busy building the warehouse. It should be noted that the project was designed to double the turnover. One and a half years have passed since the creation of a final concept. During this time, the team developed a detailed technical design and produced the facility.

During the development phase, the data was updated again and again. In the process, it also had to be determined that the order volume had changed in the meantime. The number of orders had increased significantly, especially the number of single-line orders. As a result, the project had to be quickly adapted.

We recommended a new processing technique: Although it remained mostly single-line jobs, the number of jobs had increased. Against this background, it was necessary to increase the conveying capacity. An additional sorting system with a peak throughput of 1,200 units per hour was installed on the ground floor of the client’s warehouse. At that time, the client already had a throughput of 1,500 to 2,000 units per hour, and it was predicted that it would continue to double by 2025. To anticipate this development, we suggested that the customer move the single-line orders to the second level of the warehouse, where they would immediately be manually packed and sorted into totes. Each bin can hold one direction and up to 50 orders together, which would otherwise take up 50 logical areas on the conveyor. The full totes are already sorted by direction on the sorter. This solution enabled the client to handle the increased order volume.

KAPELOU solutions in the automotive industry

In the 9 years of our existence, we have implemented numerous customised solutions for customers from the automotive industry. For example, we installed Pick to Light on the sorting wall of Multi-Lots. This increased the picking speed and reduced errors in the picking phase. The employee receives the information from the system where the goods have to be placed. In addition, the process combines packing and order control.

To ensure maximum storage density and the correct order sequence, a multi-level shuttle system was implemented. It is used to store class A+/A products and deliver them quickly and automatically to the picking points in a “goods-to-person” process. Another example of the use of the multi-stage shuttle system is the storage of packaged orders and their release to the minute upon arrival of the respective carrier.

AGV-based sortation systems have been used for sorting low throughput orders. The solution offers flexibility and scalability and speeds up order processing.

Mobile shelf racks with the “Pick-To-Light” system were installed for sorting goods for SNS orders. This eliminates those additional operations where packed orders are reloaded onto a trolley for transport to the vehicle. This saves time and reduces errors. In addition, diverters and powered roller conveyors were used for automated sorting of the packaged goods according to routes.

An AKL (stacker crane) has been installed to pick the finished orders. The employee sorts the goods from the multi-tray on the sorting wall. In each sorting zone there is a plastic tray on which the goods are stacked. After picking, the miniload automatically picks up this tray and places it on the conveyor belt for subsequent packing or shipping.

KAPELOU’s other solutions include:

• Automated multi-level sorting systems according to order waves – Buffer sequencer. It ensures that goods are stored in the buffer system and automatically transported to the employee;
• sorting systems according to order waves based on gravity racks;
• 2,3,4 mezzanine versions;
• vertical conveyors for automated transport of boxes between levels;
• systems for the removal of empty boxes;
• mechanisms for automated stacking of empty boxes;
• automated strapping systems;
• industrial robots for palletising boxes with goods;
• weight control.

KAPELOU offers various solution concepts for your warehouse

1. Mezzanine storage increases the usable storage area.
2. Conveyor systems for automated transport between different storage areas reduce the distances employees have to walk between storage areas.
3. The weight check at the end of a storage area is used to check the picking for correctness. If there is an error, it can be corrected before the tote leaves the storage area.
4. “Pick-to-Light” performs sorting of multitrays and goods by order.
5. The packaging area is ergonomically designed.
6. An automated sorting system sorts the goods according to routes.

The spare parts industry is thus one of the most complex logistics sectors in the world. Accordingly, a spare parts warehouse has special characteristics that must be taken into account when introducing automation. Based on in-depth industry knowledge and many years of experience in the automation of spare parts warehouses, KAPELOU offers you a range of special services: Analysis of all warehouse processes, development of warehouse flow charts and warehouse space calculation, manufacturing and equipment selection. The result is a customised turnkey automation solution for your spare parts warehouse based on all analysed data to the extent required for your flow of goods.