Scavuzzo’s Webinar – Warehouse Improvements – Increasing Accuracy & Efficiency

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Warehouse Improvements Using AFS WMS – Increasing Accuracy & Efficiency

In this webinar, John Robba of Scavuzzo’s will talk with AFS’ Jordan Bullington, WMS Manager, about how Scavuzzo’s address the challenges of increased accuracy and efficiency in their warehouses. John will talk about how they train new employees and get them up to speed fast.

As transparency becomes an integral part of the global food supply chain, companies are being required to maintain detailed and up to date reports on their warehouse inventory.

Warehouses need to be able to report on where products came in from? When products arrived? They need to know where products are after they leave the warehouse? Their staff need to be trained to manage these requirements. Today’s warehouse has to be able to turn product efficiently and accurately accounting for all its inventory to keep date sensitive product from sitting too long on the dock and missing its place in the rotation. For perishable’s, this is of the utmost importance.

Warehouse Improvements Using AFS WMS – Increasing Accuracy & Efficiency

In today’s webinar, John Robba of Scavuzzo’s will talk with AFS’s Jordan Bullington. They’ll talk about how Scavuzzo’s has addressed the challenges of increased accuracy and efficiency in their warehouses. John will talk about how they train new employees and get them up to speed fast. As transparency becomes an integral part of the global food supply chain, companies are being required to maintain detailed and up to date reports on their warehouse inventory. Warehouses need to be able to report on where their products came in from and when products arrived. They need to know where products are after they leave the warehouse. Their staff needs to be trained to manage these requirements.

Today’s warehouse has to be able to turn product efficiently and accurately, accounting for all its inventory to keep date-sensitive product from sitting too long on the dock and missing its place in the rotation. For perishables, this is of the utmost importance.
Ian Faith: John Robba is the Director of Operations at Scavuzzo’s Incorporated. He has twelve years of experience in food service from IT to operations and finance. He started loading trucks in college for a poultry company in South Georgia, and since, has worked with multiple companies all over the country in every area of our industry. Scavuzzo’s is an independent food service supplier currently in its fourth generation of family ownership. They focus on more wholesome, honest approach to the complicated food service industry. Their distribution footprint extends out of Kansas City, Missouri, to Texas, Colorado, Illinois, Louisiana, Iowa, Mississippi, and Nebraska.

Many years ago in the old country, one’s ambition and destiny was one’s family trade, the family trade that kept the family alive and a town flourishing. Call it nostalgic or old fashioned, we love that side of our history. We love what we do.

John: We’re a heavy protein house, so we have a lot of control issues. We have catch weight; we have standard weight. One of the biggest concerns that we had from the dock standpoint was adding all the catch weights up for items that didn’t come across on the manifest, and getting the accurate lots recorded, and making sure that we tracked each individual lot into the slot, or to the overstock location. Manually capturing all of that data on pieces of paper, and making sure that paper got to accounting or got to the warehouse management staff, or getting to where they had to go, was extremely time consuming. We would probably, on a twenty-five-line order, with one of our major beef suppliers, be close to an hour making sure we had the right product, making sure the dates were within tolerance, making sure the lot codes were something we could accept, etc. After the WMS’s implementation, being able to scan the G-10 directly into the system and not only capturing code dates, lot numbers, and manufacturers right there on the spot from one scan, I mean, as fast as we can pull the pallets off of the truck, we can digest them and put them into our system. A hundred percent, it really reduced the amount of time and the amount of paperwork, and the amount of hands that had to touch the receiving order to get it in.

Jordan: You kind of touched on this a little bit just a second ago, but can you go into a little detail as far as what type of information you currently track on the inbound orders and on the inbound order lines when using a WMS?

John: The first question that we have on the WMS is the temperature of the trailer that we’re receiving the product from, so we have a record of that. Most carriers nowadays have onboard temperature control or temperature reporting modules. We do have an infrared gun that we also use to collect that data, so temperature control. We also collect the lot number that’s associated with the product. We control the manufacturer code date, reception date, depending upon different mixes of products that have different requirements. Dairy may have an expiration date, whereas beef has a rotation or a reception date for expiration. I think the interesting thing that we see now with the introduction of G-10 is being able to eliminate not only user error, but manufacturer’s error, where they’re sending maybe one or two of the wrong products in a load. Scanning those into the system, we’re able to find those at time of reception and reject or make the purchasing department aware of that, instead of waiting till we either incur a mispick or a misrotation on the wrong product.

Jordan: What were some of the major issues that you used to see when you’d receive on paper?

John: The first calculation, first off, was it twenty-five cases, twenty-six cases, or twenty-two cases? I’d get a discrepancy from our accounts payable department that says, okay, they’re billing us twenty-four cases; your reception receiving manager said twenty-two cases. Which one is it? There was really no justifiable way to go back and say, “Oh, it was for sure twenty-four or twenty-two. Short pay them or over pay them based on what we actually received.” Whereas in the WMS system, for instance, we can go back and since those products were assigned the license plates, even if they’re out of our facility, we are able to run an audit on that license plate and see that it was tracked all the way to the overstock location, into the pick, who touched it, when they touched it, how many they touched. You can get those answers to those questions from a reconciliation standpoint.

Jordan: Yeah, and of those issues that you used to see while receiving on paper, how did the WMS help resolve those?

John: Well, from the reconciliation, it does the math for you. Basically, once you scan the products in there, the quantities, it will compare that to the RO or the PO and make you verify that you did short. For instance, if you accidentally typed in a number that wasn’t correct, it prompts you to go back and double check and verify that what you said was correct. Like I said, in the protein world, there’s a lot of very similar products with terrible descriptions. Anybody in the protein’s probably laughing right now, because the descriptions are just draconian at this point, but the manufacturing numbers are always going to be a nice unique way to identify most products. Being able to verify that what we said was on the RO is what we’re actually receiving is huge in our industry. That and the catch weights, making sure that the total gross weight ties out. We’ve caught some suppliers and shippers adding in pallet weights and not using proper business etiquette when it comes to selling per pound items. It’s this whole ball of things just run so much more smooth. There’s so much data that’s collected. Being able to reconcile and go back under any circumstance and tell where your products have been or how many or whatever question you’re trying to answer.

Jordan: This topic that we’re going to go over is talking about keeping accurate inventory levels within your four walls. John, can you talk a little bit about what were some of the biggest pain points that you had before you had a WMS in regards to managing your inventory.

John: I think there was really for us two major pain points. Like most people in the industry, when you get down to less than five cases in a slot, your sales
force is either going to completely rely upon that and trust that slot, that order is going to be filled, or they’re going to say, “Anything under five cases, I’m not even going to make that sale.” We’ve absolutely seen an increase in sales when it comes to items that we have a short amount of quantity on hand.
I think the other part of that is the traceability of the products, so when there is an inventory issue, let’s say those five did not exist, there’s audit reports, there’s lot controls, there’s all these tools that we have access to now with WMS that allow us to go back and trace back why exactly do those five cases not exist? Who was the last person to touch them? Was it a mispick? Was it a misrotation? We’re they damaged? You can really start to answer those hard questions that I think everyone in the industry has, especially when it comes to low-on-hand quantities.
As far as our inventory control process goes, our inventory control manager with WMS now has an aggressive cycle counting skill, so he has a tool now that he can monitor how he’s doing. Currently for us, we count in our entire facility every quarter. That’s our goal is to have every aisle and every slot counted every quarter in a rotation basis. For instance, we had our bank come down at the beginning of the year for an audit, since we’re not doing physical inventories any longer. We had less than a five-thousand-dollar variance on about four million of inventory. When you’re talking about tightening up the noose, and the day to day operations of what happens in the loss of products, I mean, five thousand on four million is a pretty significant, accurate inventory.

Jordan: You went away with complete wall-to-wall physical inventories. I think living in a paper world, that’s very common to do wall-to-wall inventories on a monthly or quarterly basis. Using a WMS allows you to count the problem slots, the problem products, and it points out where the problems lie in the warehouse so you don’t have to count the slots and the products that aren’t giving you grief or aren’t giving you discrepancies. Basically, you don’t have to spend all the man hours every month counting every single slot. It’s just on an as-needed basis or in an incremental way.

John: Absolutely, so it’s mainly by exception, not the rule, right? That’s what we’re all trying to get to. Let’s deal with the problem issues and let’s trace back and figure out why exactly these problems, or operator. We’ve actually established in a few cases an operator was not trained properly and wasn’t doing the replenishments. Without that audit, that traceability to go back, to understand who is moving what, there’s really no other way to come to that conclusion.
Jordan: Yeah, and after implementing WMS, can you talk about how this made the buyers, the salesmen, and the warehouse employees jobs easier and more effective?

John: Well the buyers, for sure. Right now, our inventory reception, our RO job runs every ten minutes, so from our purchasing department, and we actually have three facilities that we utilize reception at. Our buying department is centralized, so no matter what facility actually receives the RO, within ten minutes, they have an accurate short or over or what actually happened to that RO. As you’re managing lines, and I’m not purchasing, so I can’t really speak to their job title as much, but I do know there’s a significant amount of efficiency that had been gained and trust, in the fact that items were scanned into our system, were put away by this person, and for certain, we were shorted or over or whatever the case may be. That allows the purchasing department to be almost pro-active in the fact that they can call the manufacturer while the product is on the dock or right after the reception and facilitate the back order fill or the sending back a product when they send us the wrong or there’s damages. We can handle that while the LTO or the shipper is still at the dock. We can make sure that we can get it back to them or whatever the solution is going to be. We handle that real time instead of reactively a few days later or so on and so forth like I think a lot of people, including ourselves, where we were in that boat.

Jordan: How does the WMS better equip your team with handling rotation and close to code items.

John: We look at it in kind of waves. We implemented the core functionality of WMS, which is replenishment, reception, so on and so forth, where now, in the last few weeks, have gotten really heavy into misrotation. We’re picking license plates that are younger than … We have older product existing in the warehouse, so we’re running that report to verify that we’re not skipping over license plates or lots. Then the short coded, there’s a report in WMS that comes out and you specify the shelf life in which you’d like to see your products. Basically, I want to see something, all products in our warehouse that are going to expire in the next fourteen days. Our inventory control and quality assurance department gets that list together and sends it out to sales and purchasing and marketing, and we’re able to be more effective. Do we need to give this product away at cost, or can we donate it? Is this a recurring issue? Is this the same manufacturer sending us close date items? All those questions can be answered by just a few reports dumped into Excel with some basic analytics thrown against them.

Right now, we’re having a really big push; we’re in the process of installing OMS, the order management system. Our goal going forward is to put all of our short-coded items on a push order guide and sending it out to the sales force so that it sorts the beginning of all of their screens. Every time they sit down with a customer and the open their laptop, the first items that are going to pop up are the items that we’re trying to push out of our warehouse. Without the OMS and the WMS combination, there really would be no way to assume that.

Jordan: We’ll talk a little bit about slot optimization and the pick path improvements and how WMS played a role in that or through those. John, let’s talk about how the WMS helps with your slot optimization and reducing the labor within your four walls.

John: I think there’s two major key points that we’ve seen, and what I like about this topic is, it’s not a traditional WMS topic, right? It’s something that you can do with the data that’s collected via the system. Slot optimization is allowing us to run replenishment efficiency reports. On a weekly basis, we print out the audit by a job RP, or replenish job, and we look at slots that are violating what we would consider more than one or two visits per week. For instance, we had a slot location that we were visiting sixty-six times, average, on a weekly basis. We were able to make four pick slots, or a super slot, two full bays, and we reduced that to less than twenty replenishments per week. Now we’re visiting that a third of the time and that replenisher, that stocker, now is doing other jobs and is more efficient at what he’s doing. He’s touching the items that we really need to touch, and not the items that we sell a lot of. I think a lot of people struggle with the top end and the back end. The top end is what items need to be super slotted, and what items need to be consolidated into maybe a hand stack. It’s really easy to run a report sorted into Excel, and say, “Okay, these twenty-five items need to be hand slotted, and then these twenty-five items need to be taken into a super slot. Then we can capture those line items and then over the course of time, we can see if what we’re doing is helping the efficiency. Are we really going back twenty times? Is there a reduction in overtime? Is there a reduction in hand stock slots? Because if you’re only selling one a month, or one every two months, one a quarter, there’s really no need, if you put five or six in there, you’re good for the entire year. Being able to track that, to see if that actually is occurring is big time for us.
The other key point here is pick path optimization. We are a food service company and the customer dictates the product mix. As everyone else knows, as different manufacturers come in, or as deals come in, as rebate programs, whatever the case may be, the product mix will change. What we’ve done with WMS, in conjunction with our ERP, is we’re applying sales data against the slot max sizes, and we’re optimizing our pick path based on the products that we’re actually moving.

Actually, I have a pretty good case study. We brought on a pretty significant amount of business over the summer, and their product mix didn’t really mix well into our current. With a couple of months of data, we sat back and it was taking us almost an hour to pull one of their dry pallets. It’s a sixty-five cube food service dry pallet. It’s as tall as you can get it, and it’s a huge, it’s a pretty significant amount of business that we picked up. We were able to move some slots forward and back, and kind of looking at the way the volume and the stackability, so stack factor of the product, the velocity of the product, and the cube of the product, gave us the three criteria that we needed to optimize our dry picking path.
Those pick times are down to around forty minutes or less for the same order, same picker, same selector. Everything is basically the same other than the product is in a different location. He’s not making it all the way down the third or fourth aisle any longer. He’s basically done with his pallets by the time he’s rounding the second or third aisle end cap.

Ian Faith: John, can you talk a little bit to the training of employees before you had WMS. Was it longer to train them? Were they more efficient? Is it more efficient with WMS?

John: I think what WMS brought to the table for us was a uniformity in our training procedures. Like most companies, when a new employee starts, unless they have a really dedicated job, they’re kind of being cross trained. They’re usually with a senior staff member who is wearing multiple hats that’s in charge of receiving but also does something else. What we were able to do was, we defined our warehouse into basically job type, and now we train to a job type. WMS allows that, because if you’ve seen the system, it’s really broken down into the eight major things that we do in operations. You can scale up someone’s new training ability, so as they come in, you can stick them with your lead replenisher and they just live in replenishment until they fully understand that system. As they understand that, you can branch them into rotation, or you can branch them back into receiving or shipping or each one of the modules. It’s kind of compartmentalized, our training, and it makes it more uniform and it makes it easier to implement per person as they come on board.

Ian Faith: With a structure like a WMS system, is it a more structured learning curve for employees, compared with before a system, where it was maybe more paper based?

John: I would say there’s a lot more accountability for what they’re doing. Everyone comes in with a different relationship with technology. Some people pick it up really relatively quickly. Some people do not. When you compartmentalize it down to just a few screens, for instance, you really eliminate that learning curve. Most people can pick up a few screens at a time, over the course of a few weeks, relatively the same. That’s what I mean by uniformity, is we have one training mantra now that’s broken into modules, that everyone basically is learning at the same curve. Fortunately for us, we don’t have a huge turnover, but we do have a few people here and there that are constantly being trained in our facility. You can kind of scale that up as you’re building grows and as your business grows. As you bring on more employees, you can compartmentalize that so it’s not trying to drink water out of a fire hose. You can compartmentalize the training that way.

Ian Faith: Right, and if any of the audience want to take a lot at Scavuzzo’s website, one thing you’ll see is that it really is a family-owned business. They have pictures of the picnics and events and it looks like a great place to work. Do you find that you have a situation where retention of employees, with that sort of culture, sort of helps, so they actually don’t mind more of a learning curve because of that great feel within the company?

John: I think company culture is paramount, at this point. I think if you start your organization from the employee level and work your way up, you’ll always be more successful, because your employees will always take care of your customers or your vendors or everyone else that’s in your business model. What’s interesting about Scavuzzo’s being in the fourth generation is the family members are scattered about. They’re not just executives. They’re in sales, they’re in marketing, they’re in executive branch, they’re in transportation. There’s always someone that has a lineage back to the original beginnings of the company. I think seeing that and seeing that those people still work in their departments, and are sought after for advice, when a family member is a senior staff member, you kind of do it for the right reasons, if that makes any sense.