ASICS ﬁnds the perfect ﬁt in Warehouse/DC Operations
February 01, 2013 - LM Editorial
Japan-based ASICS Corporation—an acronym from the Latin phrase, Anima Sana In Corpore Sano (“a sound mind in a sound body”)—employs the latest in scientific research for the sole purpose of staying ahead of the curve when manufacturing the most advanced athletic products in the world. Since being introduced to the U.S. in 1977, the manufacturer has gained tremendous ground as the go-to footwear in this country’s burgeoning population of running aficionados.
Today, its American subsidiary, ASICS America Corporation, distributes athletic footwear, apparel, and accessories to a vast array of customers—including major sporting goods stores, department stores, family footwear retailers, and specialty stores in the U.S.,Canada, and Brazil. The company has been growing rapidly; reporting double-digit gains in net income in 2012. With such impressive growth comes great responsibility, and ASICS America’s distribution team has kept a close eye on its distribution infrastructure so that it can continuously and seamlessly support revenue growth while efficiently meeting customer requirements.
Since 1996, the team had operated what was in its day a state-of-the art distribution center (DC) with pickers using mobile radio frequency (RF) devices to zone-pick orders from traditional pick modules to cartons on conveyors. Initially designed to support $500 million in sales, this old DC began feeling the pain as sales—predicted to grow to $1 billion by 2015—began exceeding its capacity. The DC operations team knew it had to step up in order to keep pace with growing demands as well as corporate expansion plans.
So in August 2011, the team flipped the switch on a new, technologically advanced, 520,000-square-foot paperless, wireless DC in Marshall County, Miss., to process the company’s footwear product line that drives the majority of its business. Over the next few pages we’ll detail how ASICS completely transformed the way it processed footwear orders to accommodate rapid growth using a high-capacity unit sorter. We also take note of how it’s using mobile equipment to keep a real-time check on inventory; improve communication among floor supervisors; and efficiently manage assets, resources, and shipping operations.
Outgrowing the old DC
After years of aggressive growth, it wasn’t until 2007 when Kyle Koestler, ASICS America’s director of DC planning, knew something had to give. “The capacity of the old DC was about 50,000 units per day, but we needed to ship an average of 65,000 units per day. We basically had to work 22 of 24 hours, and during our peak season, overtime hours were especially severe,” he says.
Continued SKU proliferation didn’t help matters. While the old DC had only 12,000 total pick faces, including apparel, it was potentially processing in excess of 20,000 SKUs. “Whatever SKUs that we weren’t picking for the day we pulled out and replaced with whatever SKUs we needed,” recalls Kim Appling, director of DC operations. “We would do this at night so that when the workers came in they could just start picking.”
Most of its business drove outbound processing and shipping to the end of the month, but because it couldn’t keep up, the DC had to process a number of its end-of-the-month orders by the middle of the month. That compounded the challenge of finding additional space to hold packed orders in a facility that was already bursting at the seams—in fact, the team was already using 224,000 square feet of off-site warehouse space.
The final test of the old DC’s mettle was how quickly it could handle its “at-once” or high priority orders. “We’re extra sensitive to the ‘at-once’ business because the better we are at responding to them, the faster we get product to the store shelf to fill the need,” explains Koestler. But unfortunately, “at-once” was taking between 3 to 5 business days, and Koestler and Appling knew they could do much better.
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