More Storage and Faster Picking Speed With 85 Percent Less Floor Space

L-3 Communications pumped productivity 65 percent with a vertical storage solution

New York-based L-3 is a Department of Defense contractor in aerospace systems and national security solutions. Their Senior Manager of Manufacturing Operations had a common warehousing problem, an offsite stockroom.

Linkabit builds DoD electronics such as this AN/PRD-13(V)2 Man
Portable Signals Intelligence (SIGINT) System.

Off-site stockrooms can slow down production

“We had our stockroom offsite and had unacceptable transportation and wait times to go and get material and bring it back,” said Black. “We were only able to support about two runs a day.” Like most organizations dealing in warehoused inventory, L-3 needed much greater accessibility. “We wanted to bring our fast moving inventory next to our manufacturing site and we were okay with building a building to do that, but we had only a very small footprint to work with.”

Black works out of L-3’s Linkabit division, based in Melbourne, Florida. That division specializes in SATCOM, Electronic Warfare Systems, Tactical Radios, Threat Simulators and Obscuration Systems. It’s a complex manufacturing environment with multiple components and subassemblies that can wreak havoc with any production system.

Generating alternatives to gain back manufacturing floor space

To evaluate whether there was an alternative to constructing a separate building, Black contacted Outsource Equipment Company and spoke with salesperson Andrew Hennes. “Andrew is really responsive. He came and met with me, and he brought options,” Black explained, adding “we had a really good exchange. I told him our goal was to reduce square footage in terms of floor space and that I wanted to be able to gain back as much as I could.”

At first, L-3 wanted to save money by obtaining used equipment, which is an option that Outsource Equipment offers. Hennes quickly located two machines that would work in tandem to meet L-3’s needs, but also offered a new build solution that offered greater productivity…by going upwards, rather than outwards for part storage.

Hennes’ solution was, according to Steve Black, “the perfect match.” Hennes specified a single, new Modula vertical lift module (VLM) that would meet all the requirements – while only costing about 15% more than the used option. And, as a new piece of equipment, it came with a two-year warranty.

“We settled on the Modula Lift ML50D because it has 1,800 linear square feet of storage capacity,” said Black. “Based on the amount of shelving we had per shelf, that equaled 10 rows of shelves – which was a pretty big deal, as it was the exact amount of space we needed.”

Vertical storage saved 85 percent of the
space used previously for part storage.

Vertical storage took less space, but also increased part handling speed by 60%

The benefits of the Vertical Lift Module weren’t limited to space savings, though. “It sped up our kit-pull process by probably 60%,” Black noted. “From that standpoint, it allowed us to reduce staffing, because we don’t have to have as many people running the stockroom to make the output requirement.”

The gains Black noted are commonly achieved with the system. Productivity can be increased by approximately 2.5 times by using a VLM. In addition to the reduced amount of time spent searching, other key reasons deriving from the recovery of space are:

  • Less time spent walking the aisles
  • Less time spent replenishing
  • Less time spent on paperwork

Stocking the VLM proved to be no more difficult than setting up a traditional warehouse. “The actual stocking is easier, because the computer tells you where to put things. When you have shelves in a stockroom, you basically have to do an alphanumeric ordering of the parts,” Black explained. “Now we don’t have to do it that way. That’s a huge time savings as far as building a stock room from the ground up. It reduces the overall complexity.”

Reducing warehousing floor space leads to significant savings that flow straight to the bottom line

The most immediate effect of moving to Vertical Lift Module systems are the dramatic reduction in floor space dedicated to storage, and more importantly, the cost associated with that floor space. Here’s an example:

Vertical storage saved 85 percent of the space used previously for part storage.

  • Rent/lease – yearly cost
  • Overheads (light, heating, cleaning) per year
  • Total recurring cost of warehouse
  • Saving 310sq.ft vs. shelves means
$2,900 saved every year
  • Saving 2,170sq.ft vs. goods on floor means
$20,300 saved every year

With the average warehouse facility occupying 30,000 square feet with static expenses of $300,000 a year, the 85% saving of space represents serious savings; in this example, some $255,000, savings that flow straight to the bottom line. And this is before the savings from faster, more accurate picking are factored in.

A laser pointer helps operators pick from the
correct compartment, minimizing errors

For L-3 Linkabit, the addition of a VLM system has paid dividends on manufacturing productivity, space utilization and, critically for an electronic system maker, error proofing. Said L-3’s Mary Henn, “We simply tell it to bring down the row where an item is, rather than having to search up and down shelves. There’s a much quicker turnaround, so we are able to satisfy our internal customers when they need a part quickly.”

Learn more about Modula vertical lift modules

Modula has paid a fee to to promote their vertical storage solutions. They have had no editorial input to this post. All opinions are mine. J. Anderton

Written by

James Anderton

Jim Anderton is the Director of Content for Mr. Anderton was formerly editor of Canadian Metalworking Magazine and has contributed to a wide range of print and on-line publications, including Design Engineering, Canadian Plastics, Service Station and Garage Management, Autovision, and the National Post. He also brings prior industry experience in quality and part design for a Tier One automotive supplier.