The construction of the Olimp Labs Smart Logistics Center took two years (2013-2015). During this time, we faced a number of challenges. In the process of creating the center, we used an innovative concept of storage and logistics methods, based on our own innovations and patent applications. These were solutions that were not used in the broadly understood pharmaceutical industry at the time.
When we started working on the design and construction of the Intelligent Logistics Center, we took into account a number of needs that it had to meet. We were guided by new development trends, but also by the challenges that faced the global market. We paid special attention to the need to maintain full quality control of the products served, the need to protect customers against counterfeit products, as well as the correctness and effectiveness of the supply chain and distribution.
QR CODE SYSTEM
The first works on ICL began in 2011, but the QR code system was implemented in the company three years earlier. There are various sections in the QR code, incl. GTIN, product expiry date, batch number, and in addition, the unique code of the unit product or SSCC (Serial Shipping Container Code) of the multipack. The launching of labeling for dietary supplements by Olimp Labs in 2008 preceded by more than a decade the requirement to use a unique identifier for medicinal products resulting from the EU commission directive of 2015, effective from February 9, 2019.
QR codes are printed or laser-burned on unit packages during the production stage. From that moment on, each product is very accurately identified by, among others product parameters, production series, production time, production line number, means of transport, precise time when the product was in stock, etc. The individual QR code of the product is sent to the collective packaging. Collective packages, and then the pallets on which they are located, also have unique codes (SSCC codes). The combination of the marking system with IT systems of the MES, WMS, ERP class allows us to view the location of each product and the route it has traveled since its production on an ongoing basis.
QR codes marked on Olimp Labs products also have a number of other applications. One of them is the possibility for the customer to check the authenticity of the purchased goods and to participate in the loyalty program using the Olimp Premium Club application. During the implementation of the investment, we considered the use of other technologies (including RFID), but after analyzing the trends in the supplement and pharmaceutical markets and the possibility of further integration with distribution networks, we decided to adapt the QR code system already present in the company to the new conditions.
THE OPERATION OF THE INTELLIGENT LOGISTICS CENTER
Intelligent Logistics Center consists of:
- fully automated high bay warehouse (SILO). It is 32 m high and has a self-contained rack structure. It holds 11,500 pallets, serviced by three automatic stacker cranes with a pallet conveyor system
- Mini-Load warehouse, where instead of pallets there are 11,000 Euroboxes (cuvettes) filled with collective and individual packaging
- picking zones equipped with an automatic system of horizontal and vertical container conveyors, equipped with depalletizing and picking robots
- carton-flow system and various rack systems for picking low-rotating and oversized goods, an integrated conveyor system with an automatic picking zone
- a shipping zone using a diversified forwarding technology
The SILO warehouse is designed to handle B2B orders (large orders carried out for network customers, including larger collective packages, large pallet mixes, full pallets, etc.). The Mini-load warehouse, on the other hand, is used to handle small B2C orders, i.e. from individual clients (e.g. e-commerce) and from small business clients (e.g. retail outlets).
In the Mini-Load warehouse, the picking of customer orders for shipping is fully automatic or semi-automatic in the goods to man system. Four stacker cranes are used for this, which transport the goods from the rack to the robot completing the order. Products are scanned every time they change position. This is done automatically with the help of a network of scanners. These scanners are located in all places where products move through warehouses. Codes from pallets, collective packaging and euroboxes are also scanned.
The Euroboxes with the individually packaged products reach the stationary picking robot by means of roller belt conveyors. When completing an order, the industrial robot takes a specific number of products from individual containers and translates them into a shipping carton. The robot application is equipped with a 3D vision system that imitates human eyes. This allows the robot to see how the products are arranged in the litter box, and then precisely and safely pick them up (regardless of the angle of arrangement).
After the product is caught, another camera verifies the packaging in flight – it checks whether the dimensions of the cardboard box correspond to the data from the ERP system or whether the second cardboard box has not stuck to the packaging. The 2D code of the product is also scanned on the fly to assign it to the shipping carton. The robot then places the product in a shipping carton that will be delivered to the customer. It does it precisely, gently pressing the products against the walls of the carton and each other, perfectly filling the carton with the goods.
The Mini-Load warehouse can operate fully automatically or semi-automatically – with the involvement of warehouse employees. In the semi-automatic system, employees supported by the Pick-to-light system pick the goods that are automatically and in the correct order delivered to their station by a conveyor system powered by stacker cranes. The method of operation of the picking robot has been developed and patented by the company’s management, with the support of Olimp Labs engineers.
Two warehouses operating under ICL are connected with each other, constantly communicating with each other. They exchange both information and goods. At the moment when part of the goods is released in the Mini-Load warehouse and the number of inventories of individual indexes drops below the minimum value, the warehouses provide information and the SILO warehouse is replenished.
The assortment is replenished between warehouses regardless of the ongoing handling of customer orders and fully automatically by a depalletizing robot – without any decision-making actions on the part of employees. ICL has also been equipped with a camera system that allows you to supervise the flow of goods. This is useful, for example, when clarifying a complaint.
Data collected during communication between devices supporting ICL land in the SQL database and are analyzed by teams of analysts. On their basis, e.g. production volumes, places where goods are stored, minimum and maximum inventories in the SILO warehouse and the Mini-Load warehouse, or the storage time in individual zones.
PROBLEMS AND CHALLENGES OF BUILDING AN INTELLIGENT LOGISTICS CENTER
During the construction of ICL, we faced numerous challenges that resulted from the degree of innovation of the plans that we decided to implement.
➡ Reaction to possible failures
During a possible breakdown in a traditional warehouse, employees have relatively greater opportunities to quickly solve the problem than in a modern, automated and robotic warehouse. Therefore, the implementation of individual technologies required from us greater commitment, a large amount of tests and analyzes, as well as the introduction of additional safeguards.
➡ Integration of IT systems
Our concerns concerned the integration of IT systems and the reliability of their operation. At the beginning, the challenge was to connect the WMS warehouse system with the ERP company management system. We found a similar implementation in another company (a similar program for connecting two systems from the same suppliers). Despite the fact that it was much less extensive, it nevertheless constituted a point of reference. Ultimately, we integrated the WMS system with ERP together with an external company.
➡ Changing legal regulations requiring an update of the ERP system
This is one of the problems that cannot be permanently resolved. For example, if the legislator changes the method of settling VAT split payment, as an enterprise, we must introduce changes to the system. Our system is integrated with other systems at the operational level, therefore it is associated with the risk of disrupting the day-to-day operation of the entire enterprise.
➡ Permission to implement a fire protection system
According to the regulations, in the case of fire zones in warehouses with an area such as ours, permanent water extinguishing devices (e.g. sprinklers) should be installed. It is characteristic that these solutions extinguish the fire that has already occurred, while destroying the stored goods and the entire automation. That is why we have created a new fire protection, which is based on the inerting system (lowering the oxygen level in the room to a level below 15%, i.e. to a non-flammable atmosphere). It prevents fires. However, our planned solution was ahead of the applicable legal regulations in this area. In order to obtain a permit to implement this system, we had to undertake a number of additional measures.
➡ Adaptation of pallets to solutions in ICL
In Poland, euro-sized pallets are used, but not necessarily EPAL-compliant. The automation implemented in ICL requires the use of pallets compliant with EPAL standards (due to the width of the slots). In addition, the height of the blocks must be standardized, which are also important in the automatic handling of pallets in ICL. Failure to comply with these standards may cause problems with transport inside the warehouse – the goods may tilt on a pallet or slide off the forks during transport with a stacker crane. To solve this problem, we have implemented control gates before each pallet enters the warehouse, where all important parameters of the carrier and load are checked.
➡ Launch of ICL with the simultaneous, uninterrupted operation of the company while maintaining the FEFO release strategy
Before starting ICL, we had to supplement it with appropriate pallets with goods. Moreover, the company had to operate continuously. Within a few weeks, we maintained two warehouses (the old warehouse and the new ICL), between which the stock of goods was divided. We started transporting goods to ICL, from those with a longer shelf life. At the same time, we shipped from the old warehouse. After ensuring adequate stocks of goods at ICL, it took over the ongoing handling of customer orders.
Benefits resulting from the implemented technological solutions
Thanks to the solutions used in the Intelligent Logistics Center:
- we have increased the number of customer orders handled,
- we have lowered the costs of handling a single order,
- we have shortened the time of customer order processing – the current order processing time in most cases is 1 day (from the customer’s order to the departure of the completed shipment from the warehouse),
- we improved the flow of information between employees, organizational units as well as machines and IT systems,
- we have increased the availability of products on the market thanks to the effective implementation of the Omnichanel strategy,
- we have increased work safety, among others thanks to the use of a modern inerting system in ICL,
- we enabled clients to verify the originality of the Olimp Labs products they purchased and we increased the attractiveness of the Olimp Premium Club partner program (thanks to the QR code system),
- we precisely follow the path of each product from the moment of raw material delivery, production to sale (2D code system),
- we carry out additional quality checks of the supplied raw materials (thanks to the implemented CBR technologies).