IMPROVING LABOUR EFFICIENCY IN THE CROSS DOCK ACTIVITY OF A HOME IMPROVEMENT DISTRIBUTION CENTRE

Abstract

Because of the natural of retail business, logistics and distribution network have become the essential part of business and the core competition of a company. Many modern trade retailers have adopted a cross-docking, a freight consolidation technique pioneered by Wal-Mart, as the best practice for distributing domestic products. Although cross-docking bypasses storage, it requires coordination between incoming and outgoing shipments as well as manual labour to assort small pieces of products into different destination, similar to a flow though activity in the case study distribution centre. As a subsidiary of a large home furnishing and construction material retailer, the distribution centre consolidates incoming shipments from many manufactures and distributes combined shipments to stores on daily basis. As the most labour intensive operation, flow-though activity experienced traffic congestion and low efficiency measured by line per man-hour as workers must unpack, distribute, and sort products into each assigned pigeon hole representing a different store. The analysis of data and work study of operations suggest that the improvement should focus on small- and medium-size products as they account for majority of products. To reduce the congestion, several layouts of assigned stores and direction of traffic flow are proposed and evaluated using a discrete-time events simulation. The evaluation and analysis of interaction reveal that allowing workers to walk back-and-forth could significantly improve productivity and assigning a large-transition store to the rim of distributed aisles could reduce traffic congestion. The suggested layout and traffic direction could improve line per man hour from 28.46 to 33.89.