Arvato is currently building a new distribution hub in Hamm, Germany, which will be equipped with state-of-the-art shuttle technology, in order to cope with the rapidly growing online business of the leading premium beauty platform Douglas. From August 2022, logistics and fulfillment for orders from the online stores in Germany, Austria, Switzerland and the Netherlands for up to 150,000 different items will be managed there on a total area of 38,000 square meters.
Since 2000, Arvato has been operating e-commerce fulfillment for the beauty company from its site in Ennigerloh. With the new logistics hub in Hamm, capacities are now tripled. This is primarily due to the rapid growth of Douglas' online business, whose e-commerce sales have grown by an average of 35 percent per year over the past ten years. In the 2019/2020 financial year alone, online sales already accounted for 40 percent of total sales - and the trend is rising.
Douglas expects the trend towards online shopping to continue and demand in digital channels to rise further.
For this reason, the company already focused on e-commerce in 2018 with its #FORWARDBEAUTY strategy and has become a successful omnichannel retailer with a rapidly growing e-commerce business. Now the beauty company is going one step further and integrating online stores, marketplace and stores on one beauty platform.
Digital First is becoming the new basic approach, the aim of which is to create an even better shopping experience for the customer by means of digital solutions. In order to implement the new strategy, it was essential to build a state-of-the-art omnichannel warehouse where the various sales channels and countries will be brought together in the future.
To this end, a high-performance shuttle system and a cloud-based IT solution will be installed in the new distribution hub. In the future, more than 100,000 packages per day can thus be handled in Hamm. And the course has already been set for further growth as well, since the technical infrastructure can still be expanded if required.
Most modern and efficient shuttle system in Germany
Arvato has invested more than 50 million euros in the technical infrastructure at the new Douglas location in Hamm, which is the largest investment in the company's history to date. Julia Börs, President Consumer Products, and Jens Braun, Vice President, who has taken over the management of the Douglas project and is responsible for setting up the Hamm site, explain which solutions are being used there and how the project was implemented efficiently.
Why is Arvato focusing on warehouse automation in the first place?
Jens Braun: Warehouse automation and IT are key pillars of our comprehensive digitization strategy. The topic of cloud also plays a very important role at Arvato. In implementing the Douglas project, we are relying entirely on a state-of-the-art architecture and will be operating in an S/4 landscape that is completely cloud-based and no longer requires local servers. In addition, we are implementing EWM, the Extended Warehouse Management module from SAP, at Douglas, bringing Arvato's second major business online, which fits very well with our digitization strategy. After all, we are pursuing the declared goal of being the international supply chain management company with the highest customer focus and the strongest IT and data expertise in the future.
And how does the new distribution hub pay off in terms of Arvato's strategy?
Julia Börs: As part of our comprehensive digitization strategy, we are increasingly designing automation solutions for our global locations and implementing them at customers' sites where it really makes sense.
Having already successfully implemented various automation solutions last year, we are currently already building the fifth AutoStore system and implementing further shuttle systems. The aim of the new warehouse technologies is to optimize processes with complete transparency, increase productivity and at the same time further minimize the error rate. Exactly which solution is then used is decided individually for each project according to requirements.
Which automation solutions are actually used in Hamm?
Jens Braun: The heart of the automation solution in Hamm is a state-of-the-art shuttle system of the latest 2D generation with over 130,000 storage locations, 32 ultra-modern, ergonomic workstations and a storage and retrieval capacity of 12,500 totes per hour.
The more than 500 shuttles can not only move within an aisle, but also change aisles and thus reach all storage locations on one level. This increases flexibility enormously and reduces the effort required for conveyor technology outside the shuttles. The shuttle system is integrated into a sophisticated overall system that interacts optimally and consists of automatic carton and container erectors, three sorters, pick-by-light picking stations for samples and oversizes, and automatic carton sealers.
Subsequent sorting then takes place in the goods issue and dispatch departments.
Julia Börs: The new shuttle system is definitely a highlight with its goods-to-person workstations. Since we attach great importance to ergonomics, we not only rely on physical sample workstations, but also work with 3D glasses that visualize the ergonomics for different employees with the help of a special program.
In this way, we ensure that the arrangement is also optimal for small and large employees and also check where height-adjustable workstations make sense.
Which partner was selected for the technical equipment of the new distribution hub?
Jens Braun: The shuttle system is supplied by the Austrian company Knapp, with whom we have already been working for many years at various locations - in addition to the automation of the logistics center in Hamm, joint projects are also currently underway in Düren, Harsewinkel and in Gennep.
We have also been operating a system from the supplier for a very long time at the Ennigerloh site, which has won us over with its performance and reliability. In addition to the equipment, Knapp will also provide on-site technical support for the system in Hamm with its own personnel.
Julia Börs: Knapp belongs to a pool of leading technology providers with whom we regularly cooperate. This is because we are fundamentally manufacturer-independent and always look for an automation solution that optimally fits the customer's requirements and product portfolio.
It should be scalable and ideally also standardized so that it can also be used for other customers or sites. In this respect, Knapp has convinced us with its solutions and we are already looking forward to when the shuttle system goes live next year.