When leading appliances brand Miele revitalised its Eastern Seaboard distribution network with a three-site redevelopment plan across Brisbane, Sydney and Melbourne, the focus was on getting the fundamentals right. Considering the company’s reputation for engineering prowess and innovative design, it should come as no surprise that they applied the same standards to their new distribution facilities – perfectly balanced form and function is in their DNA.
Whilst automation and robotics are being touted as supply chain solutions that would have been inconceivable a decade ago, they can also add complexity and distractions to the design process. Instead, Miele approached the design of its new warehouses with its unique sales model in mind.
Operations director Miele ANZ Mark Bateson explains: “Healthy growth in the Australian market was a key driver for change. We sought greater capacity while simultaneously strengthening consumer service and improving our operational efficiency.”
Unlike other appliance brands, the majority of Miele’s product lines are sold only through Miele Certified Agents (MCA) and items are not held in store but within Miele owned and operated distribution centres. The exceptions are vacuum cleaners and consumables (available for purchase online or instore) and are supplied direct from the retailer. Mr Bateson said keeping most of the operation in-house allows the company to have better control over its unique distribution model. And, he points out, better cost control and increased efficiency not only benefits the business but adds considerable value for the customer.
For the Brisbane, Sydney and Melbourne redevelopments, a ten-year view was applied to the planning process, and plans had to allow for a substantial increase in throughput during that time.
Following the completion of the Knoxfield facility in Melbourne in 2016, Miele commenced planning the new distribution centres for Brisbane and Sydney. Mr Bateson explained that this allowed them to test the Knoxfield design and capitalise on the learnings in a drive for further enhancements.
Consequently, Miele engaged the services of Siecap Supply Chain Advisory to revise the design parameters of the Sydney and Brisbane sites and to undertake a detailed evaluation of storage options and their associated economic costs. The team conducted visits to the Melbourne site to observe first-hand the level of utilisation and then digitally mapped the data using its custom design evaluation software.
Director of consulting for Siecap Geoffrey Knowles explained: “We wanted to tighten bay widths where possible and we trialled different options with a clamp forklift to guarantee operational feasibility.” The Siecap team also reviewed the positioning of forklifts and cross aisles for ease of flow, and the placement of staff amenities to reduce unnecessary travel and downtime. “Everyone who has worked in or managed a warehouse knows how annoying it is to have a pillar in the wrong place,” Mr Knowles said.
“We gave the developer an efficient block-stacking layout around which they could wrap the building structure,” explained Mr Knowles. “We settled on high-density block stacking as the most cost-effective system in terms of floor space and speed of put-away and retrieval.”
When compared with Siecap’s storage cost metrics, this design worked out to be 40 per cent more efficient than the next alternative of double-deep pallet storage configuration.
A leading racking supplier installed the pallet racking. The racking design for both the new sites was a non-standard configuration due to the Euro pallets used by Miele, and design compliance to Australian standards was ensured.
The economics of varying building heights were examined. The difference between an 8-metre and a 10-metre ceiling height came down to minimal increase in lease costs, so Miele went with the taller of the two options. By designing the most economical floorplan, storage density was increased by more than 5 per cent over Miele’s Keysborough facility in Melbourne. “It may not sound a lot but every centimetre we can squeeze out of the space has an exponential cost saving for our clients,” Mr Knowles pointed out.