Survey Reveals Changing Trends in Distribution Centers

Early manufacturers and retailers would barely recognize today’s complex, fluid distribution centers. Although the basic functions remain the same–receiving and storing products; picking, packing, and shipping orders–distribution centers have evolved along with customer demands.

A recent Supply Chain Consortium survey from Raleigh, NC-based supply chain consultancy Tompkins Associates of 100 top retail and related companies reveals some interesting facts about DC operations and configuration, as well as best practices. For instance:

  • 63% of all products are still stored by way of floor bulk and single-deep pallet racks.
  • 43% of retail operations have moved to highly automated operations, while only 14% remain highly manual.
  • 46% of cross-dock labeling is done by suppliers.
  • A warehouse management system makes the put-away storage location selection for 60% of all operations.
  • 55% of inbound orders are planned against advanced shipping notices.
  • Value-added services now account for 17% of total facility space utilization.
  • 60% of all operations have a sorter to support either picking or shipping.

Overall, the survey found that customer demand, technology leaps, product mix, transportation costs and even management styles drive changes in distribution centers. Having a strong benchmarking and best practices program in place ensures that distribution center operations can respond to change now and in the future.

“Every DC should have a best-practices program,” says Brian Hudock, Tompkins Associates partner and author of the survey report. “It is the path to reducing errors, labor, and cycle time while increasing accuracy and service. A best-practices program, if done right, never ends.”

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