Flexible fashion fulfilment - a word from the experts
02 December 2019
TGW recently held a fashion industry summit at its HQ in Austria. HSS Editor Simon Duddy attended to hear the priorities for key end users in the sector and how TGW is positioning its approach as one system that can tackle both store replenishment and eComm orders.
The increasingly difficult search for employees, higher service levels, unpredictable demand - these are the biggest drivers of automation projects in fashion logistics. As a result, apparel specialists will not be able to avoid investing in automated intralogistics solutions in the upcoming years, argued TGW in its first Fashion Expert Day.
More than 120 fashion experts, including representatives from GAP, Puma, and Urban Outfitters, accepted the invitation to come to the TGW HQ in Austria, where they discussed logistics trends and challenges and toured the interactive showroom Helix.
Puma, GAP, and Urban Outfitters unanimously emphasised that the main drivers for a number of different automation projects in their companies are the lack of employees and higher service levels as a result of increased customer expectations. This was also confirmed by a quick participant survey via app: 100 percent of those surveyed expect service levels to go up so far in the next five years that same-day delivery or next-day delivery will become the industry standard. The majority of respondents are not going to rely on more employees or less warehouse automation to solve these challenges in their distribution centres, but they will instead rely on highly automated solutions.
TGW downplayed the extent to which demand could be predicted.
Franziskos Kyriakopoulos, CEO of 7LYTIX, emphasised that big data analysis and predictive analytics are very effective for short-term forecasts. Medium-term or even long-term forecasts are inaccurate, however, as predictive analytics learns from experience (data).
Raffaele Destro, industry manager for fashion at TGW, emphasised that it is crucial to have a high degree of flexibility within the supply chain in order to be able to deal with changes: “In intralogistics, companies must be prepared for quickly changing levels between distribution channels and business models. Therefore, businesses need to remain flexible and agile.”
FlashPick (based on one-to-one picking stations) or OmniPick (based on pocket sorting systems) are the two standardised split case order fulfilment systems at the core of any TGW Fashion solution and can be adapted to the needs of any apparel business.
“Both TGW solutions have been designed to be channel independent, which means they can process items in the same efficient way for any combination of retail, wholesale and eComm orders”, Destro explains.
Aided by artificial intelligence, TGW has also developed Rovolution, a robot, which picks goods from a source tote and automatically places them either into an order carton or tote (FlashPick) or feeds an automated induction station for pockets (OmniPick). Combined with the automated unloading of the pockets, this results in a zero-touch system, which means that no employee has to intervene manually in the process.
Anyone wishing to automate their systems has to be prepared to spend some money on that. This is just as true today as it was five years ago. According to TGW, however, the crucial difference is that TGW’s two new automation solutions, FlashPick and OmniPick, consist of standardised, pre-engineered modules that can quickly be adapted to different business models.
“This does not eliminate the need to individually adapt a particular system for a customer, but it does make the process much faster,” says Christoph Wolkerstorfer, CSO at TGW Logistics Group. The advantages of this approach are said to be:
- Proven optimised technology,
- fast installation of the system,
- faster commissioning, and
- easier scaling.
Destro adds: “We find miniloads are still the most cost effective storage method. Wwe use shuttle systems for faster order fulfilment. Many companies have replaced a manual pick face with miniloads or shuttles, with a sortation step and a Putwall to cope with singles. Fine, but to be futureproof, we wouldn’t recommend it. Instead we have developed FlashPick. It can incorporate highly ergonomic picking stations capable of up to 600 picks per hour. It can also incorporate packing into the process. In one instance, a customer was able to reduce the number of packers used at Peak from 337 to 86 - a huge saving.”
TGW offers technologies across the fashion supply chain, using business partners who gave presentations at the event. Francesco Ponti, CEO at CMC Machinery, from Italy, presented information on the way fully automated packing machines work that create packages adapted to the product size. When integrated into FlashPick and OmniPick, this technology allows for zero-touch Pick & Pack processes even for e-commerce orders.
“Both TGW solutions have been designed to be channel independent, which means they can process items in the same efficient way for any combination of retail, wholesale and eComm orders.”
Whether speaking about upgrading or new distribution centres: At Fashion Expert Days, major fashion brands representatives emphasised that their automation journey will continue on. According to Kevin Kuntz, SVPof Global Logistics Fulfillment at GAP, after having installed TGW One-Touch receiving systems (which are automated inbound and storage systems based on Miniload technology), his company is now planning on purchasing their ninth shuttle system for a distribution centre in Columbus, Ohio.
Kevin said: “Automation of fulfilment is well and truly on the horizon. In terms of inbound, ASRS handles 70% of volume. For the future, we will do a lot of pilots. We want to learn quickly, fail fast, and focus on what will work for us. Automated truck unloaders is a concept Gap is looking at for the near future.
“Moving from the traditional retail to the online model, increases labour by roughly four times, so anything we can do to effectively automate and limit labour costs is welcome.”
Gap operates 14 DCs with 60m parcels delivered and 265k stores deliveries carried out annually. It operates a campus model, with most sites carrying out both eComm fulfilment and store replenishment.
The German sporting goods specialist PUMA is pushing ahead with the centralisation of its European distribution network. Maximilian Molkenthin, Senior Head of Logistics, reported that the new Central European Warehouse in Geiselwind, Bavaria, is scheduled to start operations in spring of 2021. At the core of the system is TGW’s FlashPick for automated single-item picking.
Puma is investing heavily in consolidating its fragmented European warehouse system into the state-of-the-art DC, which will serve all channels.
“Part of this is driven by the need to deliver higher service levels. For example, increasingly we ship to the customers of platforms such as Amazon and Zalando. This is much harder for us to forecast than store deliveries.
“We will use TGW’s FlashPick at the new DC and we will have 713,000 storage locations, with some 122,000 SKUs. We envisage shipping 74m units per year, with our B2B Peak picking 13,500 cartons per hour, and the B2C peak picking 124,000 pieces per day.”
Digital economist and keynote speaker Dr Holger Schmidt predicted that platform businesses (e.g. Amazon, Google) would extend their dominance over traditional companies. He compared the price of a pair of Adidas Ultraboost 19 as $72 on AliExpress (part of AliBaba) to 148 euros on the website of traditional retailer Intersport.De. He also predicted that fast fashion would be less about chasing the cheapest needle, and more about fast fashion production assisted by automation and robots.
“Consumer fashion is now very fast, so the supply chain is also more about speed, you need to see speed and money as one and the same,” he said.