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Файл:TOPICAL ISSUES OF LOGISTICS. Учебное пособие для студентов-магистров направления «Экономика»
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Text 6. GE Lighting Brightens Its Logistics Scene
with Intermodal
Intermodal transport has in general been growing faster
than just about any other transportation mode, but has a lot
of room to grow even more.
That was clearly the message during a presentation on
intermodal by Amy Rice of rail carrier CSX and David
Slates of GE Lighting, at the CSCMP conference
in Denver last week.
Rice said CSX has built a tool that analyzes a company's
truckload shipments and looks for opportunities where
intermodal might be a good option. Across more than 100
shippers, Rice said that on average 14% of those truckload
moves are either an excellent or good fit for a switch to
intermodal, with additional moves not included in the 14%
also being potential candidates.
While the data might be seen as self-serving, SCDigest
editor Dan Gilmore talked to Rice about how the tool
works, and believes this is a pretty accurate assessment.
So, is that 14% of current truckload shipments sort of the
ceiling for where the intermodal industry can grow? No,
said Rice, because as intermodal networks improve,
additional track is built, etc., new current truckload moves
will emerge as good candidates. The industry has been
steadily pushing down the minimum miles for which
intermodal may make sense for a shipper.
GE's Slates said that within all of GE, growth in use of
intermodal has been strong, but that there is still a long
way to go. In 2012, GE spent about $70 million on
intermodal transport, versus some $400 million on straight
truckload. While a substantial portion of that current
truckload spend could probably be converted to

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intermodal, and more will be, some business units or
pockets of logistics operations are still resistant to the
change, for a variety of reasons.
That's not true at GE Lighting, where intermodal growth
was 25% from 2010 to 2012.
Why the aggressive switch to intermodal? Slates cited a
number of factors:
Cost: Intermodal can often reduce shipping costs more
than 30%.
Capacity: At certain times of the year, obtaining needed
truckload capacity can be challenging. Intermodal rarely
has capacity constraints, Slates noted.
Environment: Use of intermodal substantially reduces
CO2 emissions for a given move.
Competitiveness: GE Lighting belies it will gain the
advantage if it gains the benefits of intermodal earlier than
its rivals do.
"You don't want to be at the end of the line on this
transition," Slates said.
Of course, one barrier to greater adoption of intermodal are
concerns about service, but Slates said that while these
worriers may have been valid even 5-6 years ago, "Those
days are long gone. Service is simply no longer a factor."
Slates described how GE Lighting currently brings in
containers to the port of LA, and then drays them to the
BNSF yard, where they are moved to Chicago. There, the
containers are transferred to CSX, which moves them
to Atlanta. From there, they are trucked to a GE factory
in Tennessee.
Total transit time: six days - and rarely is there any
deviation from that. That intermodal transit time is just one
day more than the five days it takes to move a container

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from the West coast to Tennessee via truck, Slates said,
and that the trucking move today actually has more
variability.
And the benefit: shipping costs some 40% lower than
truckload costs.
Slates added that the idea of a hand-off between rail
carriers often gets logistics managers nervous, and thus
serves as a barrier to greater us e of intermodal. But he said
shippers should simply use a less-than-truckload (LTL)
analogy.
"Shippers don't even really know how their pallets move
across an LTL provider's network, or what terminals it
passes through," Slates noted. "That doesn't make them
nervous - the goods still usually arrive on-time. You
should think about intermodal hand-offs the same way."
Slates added that there are big opportunities to link
inbound and outbound moves by sharing equipment like
containers and chassis, either with other units within your
own company or with trading partners. He said GE's
customers were increasingly interested in such
relationships, as well as almost totally supportive of the
switch to intermodal, contrary to some perceptions of
customer resistance. That is very isolated and shrinking,
Slates said.
Slates then offered a simple four-step process for
building an intermodal program:
1. Data Gathering: Get together current lanes, costs, and
transit time requirements. Identify the opportunities.
2. Start Small: Pick one or two lanes of the most
attractive conversion opportunities. Demonstrate success.
Learn in more detail how it works.
3. Expand: Start scaling up the program to other lanes

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4. Optimize: Connect moves across the network, and find
ways to bring in moves that are more challenging to make
work
Slates said GE Lighting is just about out of level 3 and
heading into its optimize phase.
He also said you can pick other spots to get going.
Seasonal spikes can be a great place to get started, Slates
noted. Ditto for unexpected demand surges. He notes the
company recently had an unexpected giant order for 20
truckloads of goods coming out of an Ohiofactory that
would have been difficult to service using only trucks. So
Lighting moved 12 of the loads using intermodal, and the
other eight via truckload, a combination that worked very
well.
He also said shippers need to be more conscious of
inventory levels.
"I've seen times when logistics managers are worried about
a small increase in transit times when the target DC
already has plenty enough inventory there already to meet
demand," Slates noted.
Year to date intermodal volumes are up about 3.7% in
2013, according to the Association of American Railroads.
Text 7. Star quality cooling for brakes distribution
Brakes has invested in a bespoke cooling system from Star
Refrigeration for its landmark multi-temperature
distribution centre in Berkshire.
Brakes recently established a state-of-the-art temperature
controlled storage and distribution centre near Reading.
Brakes is a leading supplier to the UK foodservice industry
and the brand new purpose built facility forms part of the
company’s continued drive for sustained growth.

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With an overriding commitment to reduce environmental
impact, Brakes awarded the refrigeration contract to Star
following a competitive tender process. A world leader in
cooling and heating system innovation, Glasgow-based
Star designed, supplied, installed and commissioned a
bespoke refrigeration plant for cold and chill stores at the
new facility.
Star’s Director of Sales – Food Market, James Ward, says:
“Energy efficiency and reduced carbon footprint were key
factors in securing the cooling contract for the new Brakes
facility in Reading. As well as offering a competitively
priced bespoke system, we selected high quality
components and built-in design features such as reverse
cycle defrost and floating head pressure control, to
maximise efficiency and significantly reduce energy
consumption.”
He adds: “Rising energy costs are putting increasing
pressure on temperature controlled storage and distribution
businesses. With refrigeration accounting for up to 80% of
total energy consumption in warehouse facilities, plant
design and efficiency is key to cost saving and energy
management.”
Star’s multi-temperature cooling system for Brakes
comprises four LPR (low pressure receiver) refrigeration
units. The packaged LPR plant has an ultra low charge of
ammonia and is designed with energy saving features for
highly efficient operation.
The plant features two direct ammonia LPR systems,
which supply cooling to a frozen food cold store (-21?C)
via four ceiling evaporators. Two ammonia/glycol chillers
supply cooling to a chill store for meat products (+1?C), a
banana store (+13?C) and vehicle loading bays via 13
ceiling mounted air coolers.

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Star has a long standing working relationship with Brakes,
installing systems in depots across its UK network. As
well as supplying cooling solutions for Brakes over many
years, Star’s nationwide refrigeration engineering team
continues to deliver planned, preventative maintenance
support to ensure ongoing plant safety, reliability and
efficiency.
When it comes to designing energy efficient cooling and
heating systems, Star is a natural innovator. Star works
with strategic partners across the globe to deliver low
carbon, cost saving solutions
Text 8. The Complex Challenges of Designing an
Automated Distribution Center
Considering a new automated distribution center? There
can be many operational and financial rewards at the end,
but it's smart to well understand the many complexities
involved in facility design and approval that logistics
managers and executives may face in getting there.
That was clearly one of the takeways in an excellent
presentation this week by Dalen Mathys-Cook of on-line
grocer Peapod and Paul Huppertz, a consultant at The
Progress Group, which assisted the retailer with its design
for a new DC to support the Northeast market. The two
told their story this week at the Material Handling and
Logistics Conference in Park City, UT.
Somewhat under the radar, Peapod has been successfully
expanding its business in terms of both top line revenue
and number of markets served. Peapod has well penetrated
its home market of Chicago, and now also operates in
the New York City and New Jerseyareas as well as some
areas of the Mid-Atlantic.

67
Its distribution and logistics requirements are challenging
and complex. Customers place on-line orders across a very
wide number of SKUs, and are given two-hour delivery
windows for the following day. Delivery trucks of course
have to be loaded by order and route, with a small picking
and staging window (about four hours) to get the first
wave of trucks loaded each night. (Mathys-Cook says
Peapod is also experimenting with same-day delivery.)
That core complexity is exacerbated by the storage
handling needs of different classes of products. Peapod
carries larger, more bulky products such as pet food or
charcoal all the way to frozen foods that must are subject
to "cold chain" requirements from DC to customer
delivery. It actually has several different areas for
refrigerated space, because some produce stores better at
41 degrees while others are best say at 36 degrees.
In fact, a Peapod DC might have some nine different
storage and picking zones from which product must be
merged to consolidate a customer order, each with its own
handling characteristics, volumes and SKU profiles.
At its flagship Chicago distribution center, picking and
replenishment processes are manual, with downstream
sortation of picked cartons and totes to enable
consolidation for loading.
In the New York-area market, however, picking is
primarily today performed in the back of local Stop &
Shop stores, which like Peabody are owned by Ahold, in
an area Peapod calls "WareRooms."
When the company decided a few years ago that its
strategy would be to significantly expand the number of
SKUs it carried in additon to tthe overall growth expected
in in the region, it became clear that the current fulfillment

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processes in the Northeast would no longer cut it. A new
dedicated distribution center would be needed.
But how large should the facility be? Peapod logistics
executives wanted to consider automating what they could
in the new operation to improve throughput capabilities
and reduce cost per unit in this notoriously low margin
sector, but what was the right level of such automation?
What would be the best places to invest assuming the
capital budget was fixed, as it almost always is?
These of course are the types of questions every
distribution automation project faces, but perhaps made
even more challenging to answer given all of Peapod's
requirements and constraints.
Peapod and The Progress Group decided to evaluate each
pick area using a high/medium/low approach to material
handling automation, exploring what the options were and
how those would intersect with throughput goals, capital
expenditures required, and ROI. The effort would also
identify the pros and cons of each level of automation, and
its impact on DC complexity, flexibility for the future, and
ergonomics.
"As we added levels of automation, the question was can
we gain enough incremental benefit to justify the
investment," Huppertz said.
One early challenge was that there was no real forecast for
growth in the thousands of new SKUs expected to be
added over time, so Huppertz said they just had to
extrapolate from the data they did have on existing SKUs
as best they could. He noted that they did have pretty good
numbers on productivity rates for the more manual
approach from both Peapod's Chicago DC as well as some
Ahold facilities in Europe.

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Obviously, estimates of rates, equipment costs,
implementation costs and other data had to be developed
for the medium and high options - no small task, especially
when the effort involved multiple picking areas.
At a high level, the "low" option involved basically what
Peapod was currently doing in its Chicago DC, picking
into cartons and totes using a "pick and pass" type
approach in any individual pick area. When complete, the
carton/tote is taken by conveyor to a sorter for delivery to
the proper staging area.
The medium level approach selected for more detailed
analysis was a use of automated replenishment of pick
faces using "multi-shuttle" technology from Dematic.
Picking would be semi-automated using what Huppertz
called a "put wall," where pickers place items into a series
"cubby holes" by order, which when an order is complete
are then manually moved into cartons or totes for delivery
to the sorter.
Put Wall System from Dematic
The "high" option involved a full good-to-picker (GTP)
approach, in which multi-shuttles would deliver SKUs for
an order to pickers, where the picker would then place
items into cartons by order, after which the multi-shuttle
then whisks away to go to another picker station or back to
storage, and the process continues.
Also considered in the high option was an automated
buffer between picking and staging/loading to enable
Peapod to pick further ahead of loading times.
The initial concept was to pick very fast movers from
pallets, medium movers would get the medium level
solution of auto-replenished and manual picking, and slow
movers would use some goods-to-person and some of the
put wall concept.

70
Budget Reality Sets In
Somewhere along the way, the initial budget for the figure
was reduced, causing the team to go a bit back to the
drawing board. Clearly, some of the automation would
need to be cut, and the team had to look for areas where
changes could be made that would have the least impact on
productivity and throughput.
To accomplish that, they went back to the original ABC
velocity analysis across zones and redid the same analysis
for the big block of B movers, which were then broken
into their own ABC sorting by volumes.
A simulation tool was also used to see test the full system
in action.
As Huppertz said, "We had all the individual data elements
for each area, but we needed to see it all together."
The simulation looked, for example, at how long it would
take a carton or tote to make it through the system to the
loading area across various scenarios.
This analysis also allowed Peapod to see at what point in
looking at the full spectrum of fast to slow movers the cost
per unit for manual methods would cross over and be
higher versus a more automated system (it was around the
top 40% of total B mover SKUs).
Some things just had to be cut. One of those was using
automation in the freezer area, which Mathys-Cook said
was desired primarily to make the work easier for
employees there and therefore improve retention. But in
the end, with the constrained budget, freezer automation
just couldn't make the ROI cut.
Then came another wrinkle - early estimates of
implementation costs proved too low, as they were based
more on national averages versus the specifics of the New
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