Case Study: Corporate Express

Team Work Pays
New DC gives Corporate Express supply chain advantage

Selective RackingOperational efficiency isn't the only thing that makes the warehouse impressive. In a few short years, Corporate Express has gone from a little known Canadian office-products company to being recognized as a valuable business partner. The company is also viewed as the world's largest business-to-business (B2B) supplier of office and computer products and services. This boost in awareness is due to superior customer service, operational excellence and facility expansion. Corporate Express has nine locations and more than 1,000 employees in Canada. A new 16,000 square-metre headquarters/distribution centre (DC) in Mississauga, ON, includes 12,000 square metres of warehouse area and a 3,000 square-metre mezzanine. The facility boasts a state-of-the-art pick and pack operation, with a picking capacity of almost 19,000 lines per day. It also has storage capacity for almost 20,000 SKUs (stock-keeping units) of office supplies and furniture. The warehouse serves Ontario, national accounts across Canada and Canadian customer locations in the Caribbean.

According to Ed Meyer, the original project leader, Corporate Express' goal was to create a building around best practices and materials handling efficiencies--not the other way around. "We intended to make use of every square inch of the building, and I feel that we were successful," says Meyer.

Pallet ShelvingSince the facility opened in May of last year, Corporate Express has strived to provide next-day delivery of orders with zero defects or damage. So far, the facility is exceeding performance goals in the areas of customer service, efficiency and cost. In addition, on-time delivery is running at an impressive 99.7 percent. The warehouse's operating cost margins have also been reduced by about 25 percent.

With all these improvements, the Mississauga DC operation is attracting favourable attention from suppliers, Corporate Express North America operations and with its The Netherlands-based parent company, Buhrmann. "We're able to achieve the performance numbers we wanted to see. We did this by designing and building the facility to our specifications, as well as installing the right equipment and technology," says Meyer.

Order-picking activity starts in the late afternoon and continues throughout the night. Using an innovative, computer-directed picking system, the facility is able to significantly reduce pick errors and improve on-time delivery. By scanning labels from orders, the computer determines the optimum picking route. When there's a SKU to be picked in the pick-to-belt area, a lamp lights up at the end of the shelving bay in the pick aisle. Additional lights direct pickers to each required pick location.

Picking Pro

Warehouse StorageAt the same time, in the pick-to-cart area, the scanner gun on the picker's wrist indicates the exact pick location and quantity. The picker finds the location, scans the location bar code for correct confirmation and picks the indicated quantity. When the picker arrives back at the cart, display screens indicate the quantity of the SKU to be allocated to each carton. The facility also uses a thorough quality control process to ensure orders are picked and packed accurately. However, operational efficiency isn't the only thing that makes the warehouse impressive. During the design phase of the facility, employee safety and product and equipment protection were two areas that received a great deal of attention. For example, there are various types of cages, fences, and heavy-duty guards or barriers to protect employees from overhead product movement. In addition, end-of-aisle protectors look after racks, columns and shelves.

Meyer credits a close working relationship with key suppliers like Econo-Rack Storage Equipment Ltd. of Mississauga, which allowed Corporate Express to get the design concept right and overcome inevitable completion challenges. "We had a good working relationship and rapport with Econo-Rack and they were particularly helpful, especially when we had to make equipment changes on the fly to satisfy municipal building inspectors," he says. "As a result, everything went very well."

Hans Schmidt, vice-president, operations Ontario, is quick to credit his Corporate Express team for aggressively pursuing and achieving the targeted results in the new facility. The team includes Gord Griffin, facility coordinator, along with Stephen Eaton, warehouse supervisor, as well as pickers and other warehouse employees.

Schmidt describes the operating philosophy at the facility as "lean logistics" or "total quality management" (TQM). Employees are trained to ferret out root causes of problems, identify them to the lead hand and provide feedback as to how solutions are working. To reinforce this emphasis on quality, performance is tracked and charts are prominently displayed at the entrance to the warehouse.

"Our leaders can focus on training and turning weaknesses into strengths," says Schmidt. "Our goal is to be the number one corporate supplier of office products in Canada. The Mississauga warehouse will be Corporate Express' showpiece site in North America for performance, quality and cost." MM&D