Wholesale distribution facility, with shipments exceeding 3,000 pallets a day, saves money and frees pallet spaces by using a software program that calculates how to assemble a pallet.

Given that Amway Corp. shrunk and then re-inflated its mile long warehouse, employees can say that they know what the accordion mile is.

In addition to performing that feat, the Ada Mitch., firm saved $109,000 in costs for palletizing products and freed 2,021 pallet spaces at its wholesale distribution facility. Now corporate accountants have joined in the tune, singing all the way to the bank.

These harmonious effects weren't the result of magic, but rather a software program that calculates ways to arrange a pallet loaded with corrugated cases. With the trend of keeping lean inventories, companies might find that computer tracking technology will keep the packaging activities in their wholesale distribution facilities humming along.

Not Lost in Space
In 1995, Amway officials wanted the operation of their warehouse to become more efficient and focused on palletizing as one means to this end. Inspite of the enormous size of Amway's warehouse, saving space emerged as a goal.

"What we were trying to accomplish was saving warehouse space, as well as getting more efficient with forklift drivers" says Greg Green, system specialist. "We thought if we could increase the efficiency of palletizing we could cut down on the number of pallets that forklift truck drivers move and also increase the space efficiency within the warehouse."

Amway's warehouse is cyclopean. With about 640,000 square feet under roof, the distance from one end of the facility to the other is more than one mile. It has more than 26,000 pallet locations and stocks more than 5,300 product categories. About 3,000 pallets are shipped every day. Amway itself makes about 350 of the products it sells and markets the rest as part of its catalog business. In 1996 the firm had $6.8 billion in retail sales, representing a multiplicity of products, such as laundry detergent, body soap, food bars vitamins and more.

In spite of the enormous warehouse, efficiency was a goal as the firm wanted to save space. The company's research and development department had been using a DOS version of CAPE PACK software from CAPE Systems. Now also, in Windows, Cape Pack has several functions, including pallet grouping, pallet arranging, case filling and package design. In pallet arranging, the software calculates multiple ways to load a pallet, with varying degrees of efficiency, and generates a three-dimensional color image of these platforms.

Green inputs information in the program; there is a manual and also an automatic way to do this. Based on this information, the software calculates how to assemble a pallet load.

Under the manual system, Green inputs the dimensions of the case, the gross weight and dimensions of the pallet (the software has a library of pallet sizes). Based on the preferences of Amway, the software is programmed so that the maximum weight of a loaded pallet doesn't exceed 2,500 pounds and the height doesn't exceed 55 inches. Confessing that "we're rather lazy around here," Green can also flow automatically most of this same information from Amway's mainframe computer, from an item master in that system into a file that the CAPE software can read.

Green selects the product that's to be shipped, with all of the background information on the screen in front of him. A calculate function recommends several placements of cases, ranging from 50 percent efficient - the least efficient - to 100 percent efficient. Once a pallet arrangement is selected, an order comes up on a monitor attached to a forklift, telling the driver to bring that product to the palletizing and loading area. Cases of product are stacked by hand. Finished pallets are run through a shrink wrapper.

Space Savings
Since he installed the CAPE System, Green attributes the sizable dollar and warehouse savings to 25 pallet patterns currently approved for use, while 10 other patterns are pending. Getting approval from corporate is a sluggish process, explaining why only a small number of patterns have been okayed. "We have a fellow going through an additional 2,300 skus," Green says. "He said he's increased the efficiency of every sku I have given to him. So we know there will be more savings down the line."