May 2008 | Case Studies | DC Solutions

A Sorted Tale

Tags: Warehousing

A new automated sorter helps AWBC get the right books to the right place and into the hands of eager bookworms.

American Wholesale Book Company (AWBC), based in Florence, Ala., serves all types of retailers in the Southeast, from behemoth brick-and-mortar booksellers to the corner bookstore to online outlets.

As a leading book wholesale and distribution company, AWBC works hard to ensure that book lovers have the perfect novel, biography, or specialty titles in their hands when they want them.

AWBC counts among its retail customers Books-A-Million, its parent company and the nation's third-largest book retailing chain. Books-A-Million operates retail "superstores," Bookland traditional bookstores, Joe Muggs newsstands, and Booksamillion.com, a successful e-commerce Web site that was launched in 1998. The company also sells wholesale to Sam's Clubs and several other retailers.

When it became clear that its returns process needed updating to keep up with growing customer demands, AWBC didn't hesitate to book a solution. The company's 350,000-square-foot distribution center now dedicates about 40,000 square feet to returns.

"Our returns process was manual and labor intensive, and we needed to add headcount to our front-end operations," says Sondra McCulley, vice president of operations. "We knew we could find a more efficient way to operate and reduce labor requirements."

At the same time, AWBC was looking for a way to cut costs from its returns operations. A new automatic sortation system fit the bill.

Looking for a Partner

To select the right sorter for its needs, AWBC established a team to scout the possibilities.

"We looked at several vendors to determine which sorter would be right for our application," explains McCulley. "We considered the size of the footprint, the cost, payback, and overall labor reduction we could achieve."

After site visits to locations running sorters for similar applications, AWBC selected EuroSort Systems, a global supplier of advanced tray sorters with U.S. offices in Owings Mills, Md., along with The Numina Group, a Woodridge, Ill.-based automated distribution controls provider that could make the project a turnkey solution.

"EuroSort had a good reputation and its equipment had a much smaller footprint than other sortation systems," says McCulley. "We needed to achieve ROI within two years, and it could provide that as well."

Before signing off on the project, however, AWBC sent a team to check out the sorter at work in a Harper Collins distribution center in Scotland.

"We wanted to see the equipment in action," McCulley explains. "We also wanted to make sure the sorter could handle books without damaging them."

Also key was the chance to interview the Harper Collins management team about its relationship with EuroSort. "We saw they had a good rapport with EuroSort, which was reassuring," says McCulley.

The AWBC team then met with The Numina Group. "It was clear that they understood our business and how to make the project happen," McCulley says. "The two companies comprised a strong team."

Using AWBC's specifications, EuroSort built the new sorter at its plant in Holland, and shipped it to the book company several months later. To allow a quick start after the equipment arrived, the software integration began while the sorter was being assembled.

When the equipment was delivered, both EuroSort and Numina were ready to go.

It was crucial that the new equipment sort by "return to publisher"—no small feat, considering that AWBC deals with more than 2,000 different publishers.

"When books come back from retail outlets, AWBC has to handle the excess inventory and return it to the publishers," says Dan Hanrahan, president of The Numina Group. "The actual inbound volume always fluctuates. We had to set up a system that would sort through several different business rules and bar codes to determine where to divert the products."

Numina set up the sorter with 150 different active divert locations. From their stations, operators scan bar codes on the books and the software determines where to divert them. From there, the sorter consolidates returns to case quantities for shipment back to the publisher or for return to inventory.

The initial equipment installation went smoothly. "We pushed to run at the highest volume possible right from the start," McCulley says. "We didn't allow the equipment any downtime during that initial phase."

Unfortunately, in its excitement to take the equipment to full throttle right away, AWBC neglected to perform the preventive maintenance that Numina and EuroSort had recommended.

"The equipment shut down because we pushed it too hard," McCulley admits. "EuroSort did a great job helping us get the equipment back up and running again in short order."

The only other implementation hiccup involved bar-code scanning. "Many 17-digit book bar codes are getting smaller," says Hanrahan. "Some are so small that it was tough to scan them with the equipment we had selected. We had to invest in new camera-based scanners."

Small bumps in the road are to be expected with large-scale projects such as this.

"Moving from manual to automated operations can be challenging," Hanrahan explains. "Extracting all the business rules and customer/supplier exceptions and incorporating them into real-time, millisecond sorting decisions isn't always a straightforward process."

The new sorter and software have met all of AWBC's expectations, helping the company achieve a 20-percent labor reduction in the cost per unit. Furthermore, the book company has been able to reallocate some staff members to front-end operations.

"We now have the ability to keep up with returns and sort bargain books by title," says McCulley. "We can handle it more quickly and efficiently than when we worked manually."

AWBC wanted a partner that could execute all its business rules in real time, as well as develop rules for exceptions.

"For instance," Hanrahan says, "on a single pass, the control software can sort books to a high-volume publisher, and dynamically assign returns by titles and secondary publishers. It also can later be developed to switch to category mode, enabling it to sort by department when a new store opens."

AWBC has been so happy with the results of the sorter that it is considering adding a new one for outbound operations. "We're evaluating a much larger sorter, so we're starting the search process all over again," McCulley explains. "EuroSort has been easy to work with and we've been happy with the results, so it's on our list of potential partners."

AWBC has embraced its new technology and successfully guided its returns process into the automated age. The results have been just what the company wanted. "A project like this goes straight to the bottom line," says Hanrahan.

That's a story with a happy ending.