March 2007 | Case Studies | DC Solutions

Aerial's DC Makeover: It's a Beautiful Thing

Tags: Warehousing

A beauty supply company gives its DC a makeover. Now productivity comes in permanent waves.

It was a cutting-edge move in more ways than one when Aerial Company Inc., Marinette, Wisc., gave its business model a makeover. The company switched from selling cutlery to supplying curlers; and became one of the Midwest's largest beauty salon suppliers.

The company's roots trace back to 1912, when Fred Jaeger, Sr. founded Aerial as a knife and cutlery manufacturer. The company set itself apart by carving pictures into its knife handles, leading to a loyal customer following and an account with Sears, Roebuck.

As the years rolled on, Aerial began diversifying its wares and started providing razors, shears, and other supplies to barbershops in addition to its cutlery line. During World War II, the company manufactured pocket knives, bayonets, and military trench knives for the armed services.

By 1960, Aerial made the decision to move exclusively into beauty and barber supplies, and today's Aerial reflects that move. The company is a wholesale distributor of professional beauty salon products. Its product line consists of anything and everything you find in a typical salon—from floor mats, basins, and hair dryers to shampoo, brushes, and nail polish.

Aerial's customers include mom-and-pop salons as well as major beauty supply retailers. In addition, 51 Aerial stores in seven states provide one-stop shopping and education to beauty shop professionals.

Looking for Help

As the seemingly endless variety of beauty supplies continues to grow, Aerial's distribution center began to experience a space crunch.

"Our distribution center currently measures 80,000 square feet," says Heather Nelson, Aerial's production manager. "But that's after making three additions since the 1990s; the latest in 2005, when we added 23,000 square feet."

Seventy-six people staff Aerial's DC; 95 percent are female, as is the entire management team.

"Working for a beauty supply company is appealing to women who want an alternative to the abundance of manufacturing jobs in this area," Nelson explains.

Around the time Aerial was adding space to accommodate its proliferating SKU count, it was also struggling to keep up with the volume. The facility was literally bursting at its seams—inventory was being held in outside trailers and third-party storage.

In addition, the company's processes needed updating. "We were using a manual system and picking from tickets into carts," says Nelson. "It become clear that we could only throw so many people at the process, and that something had to change."

Looking for a makeover, Aerial hired a consultant familiar with the beauty supply business. He suggested the company consider working with Remstar International, an automated storage and retrieval solutions manufacturer based in Westbrook, Me.

"We felt comfortable with Remstar," says Nelson. "And, its software interfaced well with our warehouse management system."

After deciding to partner, the two companies began a nine-month DC capacity planning session.

"We spent a lot of time collecting data and formulating plans with Aerial so that we could provide exactly the right mix of technology," says Don Gonzales, Remstar's director of systems sales. "The company was very cooperative and provided us with all the information we needed to plan the solution."

After months of analyzing inventory, data, and space constraints, the two companies settled on a plan. But before moving forward, Aerial asked Remstar to provide validation that the technology would work.

"From the data we accumulated, we created a validation program that proved we had the right balance of equipment and technology to meet Aerial's challenges," says Gonzales. "Then we ran a simulation, and together decided to move forward."

Aerial's new DC design centered around four pods of two carousels each. To save space, the company added a mezzanine level that holds two carousels.

"We analyzed our inventory to determine the best location for each product," says Nelson, "and our low-velocity items were a good fit for the carousels."

Polishing the Carousels

Aerial's SKU makeup lends itself well to using carousels because many products are small but don't move quickly. The company stocks, for example, about 500 shades of nail polish, a perfect fit for carousels.

Another change was the addition of zone picking to the mix. "Before the redesign, we picked one order at a time—employees walked up and down the aisles picking into totes," says Nelson. "As many as 28 pickers would be working at one time, which translated into a lot of man hours for each order."

The pick modules today include flow racks set up on both sides of a power conveyor; with pallet picks on an upper tier. All totes flow to either the store order area at the midway point, or on to eight different offshoots for shipping to salon customers.

"Each section is zoned off in the consolidation area," explains Nelson. "As totes travel along the conveyors, they are scanned and directed to the right area for shipping. Once all the totes are in, the order is finished."

To ensure minimal downtime during implementation, Aerial invested a lot of time in advance planning, and scheduled the go-live date for a weekend.

"Aerial stopped its DC's production on a Friday night, then moved all its products to the carousels over the weekend," says Gonzales. "It also integrated its WMS over the weekend. By Tuesday, DC operations were back up and running. It was the fastest go-live I have ever seen."

The implementation was also carried out in phases—carousels first, followed by the pick modules and RF picking. "We wanted to make sure the transition was seamless for our customers," explains Nelson.

Gonzales credits the smooth changeover to the hard work Aerial produced up front.

"When Remstar develops DC design projects, we use a planning tool that requires a lot of input and data from the customer," he says. "Aerial provided all the information we needed, and they got it to us on time. This was a true partnership."

Today, Aerial's DC runs two shifts. The first begins at 6:30 a.m. and focuses on shipping; a second shift works the overnight hours.

Orders received by 2 p.m. are processed that same day.

"The first shift ends when the shipping is completed," says Nelson. "That provides the staff flexible hours, which keeps them happy and productive."

The shifts are even more efficient now that the new equipment and systems are in place. Where picking used to require as many as 28 employees, the same job today is accomplished with just 12.

Looking Good

Productivity has also improved dramatically. "We used to pick 70 lines per hour; that has increased to 200 lines per hour," says Nelson. "The system is capable of even higher rates as our business grows."

Since beginning the project's initial phase, Aerial has added a new pick module and carousel to its consolidation area. "We designed the building with an eye to the future," Nelson says.

She credits the project's success to the team's advance planning. "Too often, projects fail because foresight is not built into the planning," she says. "It's also important to keep the entire staff up to date as the project progresses."

Another factor that played into the project's success was the testing performed in advance of the launch date.

"We could not have pulled off loading the carousels and integrating with our WMS over one weekend if it weren't for all the planning and testing we did ahead of time," says Nelson.

In addition, Aerial worked hard to run its operations self-sufficiently, and now requires little support from Remstar.

Its strong partnership with Remstar enabled Aerial to brush up on its equipment and processes, comb through inefficiencies, and create a distribution center to dye for.