Improving materials flow from warehouse to production

Heating experts Enertech solved materials flow using Extend and truck-mounted barcode readers communicating directly with their ERP system.
The result – no more waiting or searching for parts, more efficient materials supply, greater efficiency and improved employee satisfaction.

Entertech AB in the south Swedish city of Ljungby, is part of Europe’s leading supplier of heating product and technologies for larger commercial and residential properties and district heating.

Constantly searching for parts

The company supplies its production hall via two adjoining warehouse. Up to ten people work in the warehouses on any one day, receiving around 120 order lines. Previously the system for delivering goods efficiently to production was not optimal. Pallet places quickly filled up and two people spent all their time searching for missing production parts in the warehouse on a full-time basis.

With 3,202 storage places for goods and 6,100 active articles, it was important to streamline processes and find a system that would seamlessly link to the company’s Movex ERP system.

Enertech contact Consafe Logistics to perform a pre-study to improve materials flow to the warehouse. Together they identified the following goals:

Secure a system of FIFO (First In First Out), making an ABC classification of goods according to frequency
Secure the total inventory in each warehouse
Ensure more efficient materials flow
Get more efficient/more secure inventory control
Material to be supplied to production at the right time
Ensure a total overview of material flows

Seamless integration to Movex

After a period of processing several tenders from different companies, Enertech chose to implement Extend from Consafe Logistics. Extend contained all the functions required by Enertech, and was particularly suitable as it had application protocol interfaces (APIs) designed for seamless connection to Movex. Consafe Logistics had already supplied a picking system for spare parts controlled by handheld computers. While Extend had most of the functions Enertech required, the system was tailor made to the company’s specific requirements.

"Getting the system up and running was quite a sweaty business," Comments Ulrik Lindh, Warehouse Manager at Enertech. "Our goal was to be up and running on 1 January 2011 ready for the new year. We had a few teething problems connecting the APIs to Movex, and implementing the Kanban system, but we tested everything, including the truck mounted computers and everything worked. We were ready to go at 16.00 on January 1st. This was the first time the truck drivers sat in them, and at first they were skeptical. But it didn’t take long for them to get used to they system and really enjoy the benefits it brought them."

Reporting seamlessly in Movex

Extend becomes an extension of Movex at Enertech. It reports the picking and flow of material in real-time from goods receipt, through the central warehouse to the production area.

Routines are now established for goods receipts against purchase orders, inventories and stock movements throughout the plant.

Goods are received together with a purchase order. They are scanned, with all information being transferred to Movex. Goods are classified by ABC frequency which optimizes warehousing and minimizes driving distances. Goods are transferred as needed by being scanned or inputted into the central system using truck-mounted computers for scanning and printing KANBAN labels. This makes warehouse stock and production balances very transparent.

Every time goods are moved they are scanned, along with the position they are placed in, giving total control over balances and location of materials.

Extend gives Enertech the benefits of:

Zero inventory
Accurate relocation of stock to production on demand
Fast inventory checks
Inventory on request
Information on request
Picking to pick lists for material supply to production

Empowering Personnel

"Everyone is really happy with the new system." Says Ulrik. "It is extremely user friendly, easy to learn and easy to operate, which means new employees and temporary staff can be up and running very quickly."

One of the main benefits Ulrik highlights is the greater freedom and responsibility personnel now feel. "A big bonus for our personnel is being able to influence their situation. Production staff can order the amounts they need. Truck drivers can pick the amounts they see from Movex that is best for production. It gives everyone complete control over the process. They keep materials flowing continuously, supplying people’s needs as they arise without chasing around the warehouse to find inventory so much quicker. It improves job satisfaction, raises productivity and raises the status of employees."

Employees highlighted the user friendliness of the system and how easy it was to operate, which makes it easy to employ temporary staff at peak times.

More efficient in less time

After a year of implementation, Ulrik is impressed with savings in terms of accurate production deliveries and less time spent on trying to find stock. "The system works better than I had imagined," says Ulrik, "we can now efficiently handle 622 transactions a day."

To save space and to keep total control, any stock not used in production is scanned and returned to the warehouse, where it is again scanned. That way everyone knows exactly where everything is. Faulty goods are also moved to the quality department, removing the problem of mixing faulty goods in production.

A place for everything – finally

Since implementing Extend, space is never an issue. The system makes sure there is always space in the warehouse, production personnel get the goods they want, when they need them, and from the same place every time, while everything is reported to Movex in real-time. It eliminates stock control issues, increases productivity and gives employees more control over their situation.

Fast facts:

About Enertech

Enertech AB employs over 900 people worldwide and 300 in Ljungby.
It develops and sells the CTC. Bentone, Turboflame and Osby Parca range of heating systems
Sales of 615 MSEK (€69million approx).
3,202 pallet places, 4,100 article numbers in stock, 6,100 active articles
622 transactions a day, 12,435 a month
Replenishment level 73.92%
Stock value 41 MSEK (€4.6 Million)

About Extend
Extend is a flexible system for handling several production processes such as stock taking, voice picking, database statistics, production reporting and advanced labeling.

Extend makes your ERP mobile by communicating directly with units on the floor such as handhelds or vehicle mounted mobile computer clients.

Processes such as labeling and reporting, combining or splitting orders, zone handling, consolidation and stock taking can be performed quickly and accurately. Real-time communication with external equipment such as automated carousels, electronic scales and barcode label printers helps processes run smoothly. Collecting data for performance analysis and optimization of production is easy.

Extend handles various technologies for integration with the existing ERP system, and supports many types of hardware and operating systems.

About Kanban
Kanban is a visual process management system that tells you what to produce, when to produce it, and how much to produce.

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Information about the company: Consafe Logistics AB

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