Developing a warehouse automation project takes time and strategic planning, and it often involves consulting experts who can analyze your operations, growth expectations, and long-term objectives in order to determine the best course of action. That’s exactly what leaders at outdoor equipment and tactical gear retailer Ecentria set out to do in 2022 after experiencing 200% growth in a single year and realizing they didn’t have the right systems in place to handle that kind of demand. Company leaders say they needed a plan to handle growth while also reducing costs, increasing productivity, and cutting fulfillment and delivery times for their global customer base, which includes hunters and outdoor enthusiasts as well as the military and first responders. The company sells direct to consumers as well as to business and government accounts.
“We needed a better system for managing inventory and fulfilling orders, and one that would [accommodate] future growth,” explains Chris Batt, Ecentria’s director of fulfillment and distribution center operations, adding that the company’s two-facility network included some robotic picking systems that weren’t meeting its complex inventory requirements. Ecentria is an online-only business that handles about 130,000 stock-keeping units (SKUs) across its two distribution centers (DCs). Those items vary widely in size and type, ranging from an expandable camper that fits on top of a car all the way down to small hardware items, such as specialty screws.
As Batt explains, Ecentria needed a partner that could objectively analyze its processes and recommend automated systems and DC network design changes that would help it speed fulfillment and delivery while trimming costs. The company turned to material handling systems integrator Alpine Supply Chain Solutions and within five months, was making small changes that were yielding big results, with an ultimate plan to reconfigure Ecentria’s DC network and implement large-scale automation.
“Analysis is what has made the difference here,” Batt says, explaining that a deep dive into inventory movement, demand fluctuation, and projected growth helped identify DC layout changes and slotting adjustments that have led to better productivity and labor savings before the broader automation and network redesign project has even begun.
“We’re getting more benefits than we thought possible,” Batt says.
IMMEDIATE GAINS
Ecentria’s company headquarters and primary DC are located in Aurora, Illinois, near Chicago, and its second facility is in Logan, Utah, about 85 miles north of Salt Lake City. Both facilities handle the full range of the company’s SKUs, with the exception of ammunition, which Ecentria supplies only out of the Utah site. Alpine’s first step was to conduct a storage-type analysis and automation evaluation for both facilities to determine how the company could make better use of existing space both now and in the future, given the wide variety of items stored and shipped. After analyzing A, B, and C items based on their pick location and reserve stocking location in the facilities, and factoring in projected volume growth of 20% year over year from 2022 through 2026, Alpine recommended “rightsizing” the space in each facility to improve putaway, storage, and fulfillment—advice Ecentria acted on immediately. Managers reconfigured much of the space and then reslotted items—the process of determining where products are best positioned in a warehouse or DC—for better, more efficient movement through both facilities.
As part of the analysis, Alpine and Ecentria collaborated to build a 3D computer model of the facilities, which Batt and his colleagues say helped them better understand existing processes and visualize recommended changes. Those changes included replacing wide-aisle racking with very-narrow-aisle (VNA) racking systems—a modified form of adjustable pallet racking that increases storage density—in parts of both facilities. In Aurora, the plan called for putting 3,000 high-velocity A and B SKUs —the fastest-moving items in the facility—in a central location for more concentrated picking. Workers used radio-frequency (RF) scanning devices for picking prior to the change and continue to do so in the new layout.
The initial changes have produced big results, including a more than 60% improvement in the company’s average pick rate. As of this past spring, Ecentria’s employees had gone from an average of 56 picks per hour to 91 picks per hour during peak periods. The new system has also reduced employees’ travel time throughout the facility, optimized forklift usage (no more empty or idle trucks), and nearly doubled productivity while reducing errors. Overtime has been vastly reduced, and Ecentria implemented a hiring freeze this past spring that has the company operating at its lowest headcount in 10 years. Batt says he expects to see about $320,000 a year in labor savings as a result of the changes.
“Just going from [a pick rate of] 56 to 91, as an average, is crazy,” Batt explains. “We’re seeing it in our budgets—and it’s all because of these efficiencies.”
NEXT STEPS
Leaders from both companies note that the steps Ecentria is taking today are merely precursors to larger changes, which will include a new DC network design and large-scale DC automation. Plans are to build a DC in the Midwest by 2025—as part of a single or two-DC design, which is still to be determined—that will feature an automated storage and retrieval system (AS/RS), picking robots, and advanced conveyor systems designed to optimize “every aspect of the fulfillment process, from receiving to putaway to shipping,” according to Alpine. Batt says the AS/RS will be the centerpiece of the project and is expected to pay for itself within five to seven years of implementation.
For Batt and his colleagues, the moves can’t come soon enough—but in the meantime, they say they will continue to implement projects that target the “low-hanging fruit” across Ecentria’s current operations in order to make further improvements. And they say they’re making far more progress than if they’d undertaken the analysis by themselves.
“We didn’t have to hire Alpine [for this project]. We could have done it all on our own, but it would have taken us well over a year and I don’t know if we would have gotten the same data,” Batt explains. “And the thing is, we’re still looking at the data and finding things that can help. This whole project has been enlightening. When you work with a company that doesn’t know everything about your [operations], they ask questions you wouldn’t normally ask yourself—and that really helps.”
