Consumer Goods Disrupting Retail with Automation
Published on : Saturday 04-05-2024
How Addverb implemented an automation solution utilising technologies such as Carton Shuttle, Pick-to-Light, Box-It, and Warehouse Control System.
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Hindustan Unilever, the Indian subsidiary of Unilever, a leading global consumer goods company with a strong presence in India, operates across various segments such as home care, personal care, cosmetics, and packaged foods. The company has a vast distribution network that reaches millions of consumers in both rural and urban areas through Kiranas (Mom & Pop Stores), organised Retail and E-commerce. They wanted to leverage automation to reimagine their distribution model to maintain their competitive advantage in the new digital ecosystem of B2B grocery delivery.
Objective
The B2B E-commerce platforms offered one day delivery for orders placed on their portal, while it took up to 3 days for Unilever to fulfil the same order. This resulted in Kiranas shifting towards B2B platforms.
The company aimed to deliver orders placed by Kirana within 24 hours, thus outpacing their B2B rivals.
They also aimed to deliver orders as per the required quantity and not in bulk. This would not only require maintaining adequate inventory but would also need automation to efficiently handle the inventory and drive more reliable fulfilment with reduced lead times. The automation solution should have the ability to handle eaches and perform fast and accurate picking, and dispatch them directly to retailers.
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Solution implemented
One of the key challenges was to handle the wide range of SKUs with varying storage and handling requirements and short shelf lives. The Distribution Centre (DC) had to serve approximately 4,000 to 5,500 customer orders daily, consisting of 18,000 to 25,000 cases comprising 8,00,000 eaches. The system had to handle up to 1.1 million eaches during peak demand days.
Addverb implemented an automation solution utilising technologies such as Carton Shuttle, Pick-to-Light, Box-It, and Warehouse Control System.
Six months of data analysis helped categorise the SKUs into A, B, and C classes, with a different storage mechanism proposed for each class to optimise storage and dispatch efficiency. This enabled them to fulfil orders for 28,000 Kirana stores within 24 hours without a minimum order size requirement, improving their service levels. The solution enabled pickers to achieve a rate of 9,500 picks per hour, ten times more productive than conventional paper-based picking.
Fast picking and packing, dynamic load balancing, order scheduling, and finished goods scheduling reduced overall turnaround time for order fulfilment.
The complete solution helped them save major costs, eliminate dependency on distribution centres, and reduce dependency on labours.
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Improvement in Key Results (KPIs)
The solution involved a change of model and handling a wide range of SKUs to supply to retailers directly and quickly. The system had to be robust to fulfil demands overnight accurately and efficiently, saving major operational and manpower costs.
· SKUs were categorised into A, B, and C class for efficient storage and order fulfilment.
· Implementing Goods-to-Person picking enabled pickers to fulfil eight customer orders simultaneously at each picking station for C Class SKUs.
· Installation of Pick-to-Light system with conveyor assistance, achieves pick rates of 6,500 and 3,500 units per person per hour for A and B class picking, respectively.
· The unique solution achieved a tenfold increase in pick rate, enabling 24-hour order fulfilment with 9,500 picks per hour.
· Successfully delivered orders to 28,000 stores within 24 hours.
· Achieved a high order fill rate of 5,000 customer orders in a day, involving 8 to 11 lakh eaches during peak days.
· Dimensioning, weighing systems, and high-quality cameras enable error-free quality checks by capturing discrepancies.
· Sequencing the process of loading crates in the truck according to their destination optimises route planning, resulting in saving time and costs.
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