CIRRUS TECH CRANE SYSTEM CASE STUDY WITH WILSBACH DISTRIBUTORS, INC
The Challenge
Wilsbach, located in Harrisburg, PA is a family-owned and operated business that distributes 4.3 million cases of products annually from over 45 suppliers representing the finest beverages from around the world including Anheuser-Busch products. Frank Sourbeer Jr., the President of Wilsbach, states that his vision for the company is to achieve 20M cases of annual beverage sales as a certified carbon neutral business that’s widely recognized as one of the best places to work. Focusing on the future of the business has been Frank’s primary objective to ensure the long-term vision of the company.
The challenges in the labor market and an increase in SKU complexity created a need for more operational efficiencies and space and became a major focal point for Frank Jr. A mid to long-term operations plan was needed to ensure the future success of the business and Frank Jr. wanted to take a complete 360-degree approach to solve the challenges.
In 2017 Frank started the process of finding a new site to build a state-of-the-art facility. Part of this process was evaluating if automation would be a good solution for their business and if so, what type of automation would be the best fit for their new build construction warehouse. Frank first began the process of looking at automation during the NBWA tradeshow in 2019, well before the pandemic. It was at this tradeshow that Frank met with Cirrus Tech and started having preliminary discussions about automation and Frank discussed his plan for a new warehouse. These discussions ultimately led to a more formal process in early 2020 where Cirrus Tech, based on the requested data provided to them by Wilsbach, was able to start the data analysis, design, and staffing analysis process. After the analysis and design process, Cirrus provided Wilsbach with a presentation outlining the benefits and costs of the system. Wilsbach signed with The Cirrus Tech Crane System in July 2020. Post Covid-19 caused more labor issues, illustrated in the information below
Here is a detailed look at how Wilsbach was staffed in 2019 and in 2021 before The Cirrus Crane System implementation:
Wilsbach 2019 Operation Numbers (Before Crane System Install)
Receivers/Put Away: 2 Full-Time Employees
Replenishers (Day Time): 1 Full-Time Employee
Replenishers (Nighttime): .75 Full-Time Employee
Load Builders picking package beer: 11.5 (7.5 full-time and 4 full-time equivalent part-time)
Wilsbach 2021 Operation Numbers (Before Crane System Install)
Receivers/Put Away: 2.5 Full-Time Employees
Replenishers (Day Time): 3 Full-Time Employees
Replenishers (Nighttime): 1 Full-Time Employee
Load Builders picking package beer: 13 Full-Time Employees
The Approach
Frank Jr. worked on the design of the new building with the architects and was able to provide Cirrus with the initial design of the new building. Once the data analysis, design, and staffing process was completed the next step focused on designing a system that would best fit the Wilsbach warehouse. Since space savings and annual efficiencies were a primary focus for Frank Jr., The Cirrus Tech Crane System (a High-Mid Volume Storage, Retrieval, Replenishment, and Picking System) evaluation was needed to determine what the overall ROI and benefits would be for Wilsbach. Once the initial design was completed and discussed internally, the Cirrus team met with Frank Jr. to collaborate with him on the design of the system for his warehouse. After this collaboration, the Cirrus team completed the system design and presented the solution to the Wilsbach team.
As part of his due-diligence process, Frank Jr. hired a beverage consultant company to determine the building size needed to provide a layout of the warehouse with traditional floor-stacked backstock locations and with a traditional pick path. Cirrus Tech provided a layout of the warehouse with The Crane System and a pick path that started at the beginning of the static pick locations located at the bottom of the system and designed pick locations located directly across from the system. As load builders start the picking process, they work around the horseshoe of the Crane System and then finish picking the remaining items in the static rack and case-flow racking pick locations. A traditional pick path is 2,000+ linear feet and Cirrus was able to reduce the linear feet of the pick path to 1,200 linear feet.
By significantly reducing the pick path, the Wilsbach Distributor load builders would be able to pick at a much faster rate vs. picking around a traditional pick path. Cirrus had similar success with shrinking the pick path with other distributors and, in a non-union environment, some distributors were averaging over 300 cases per hour per picker. Wilsbach was the first union working environment, therefore the question remained – would Wilsbach have similar success with their picking numbers? Both Cirrus Tech and the Wilsbach team felt confident that the pick rate would be increased and overtime would be decreased for the load builders with The Cirrus Tech Crane System pick path.
Replenishment and receiving were becoming more time-consuming tasks with the traditional layout of the warehouse. In a warehouse with no automation, replenishers and receivers had to touch the product multiple times. The travel time of the forklift drivers to perform these tasks became only greater during peak times of the year. Finding experienced people to do the work also became a challenge. Automating the receiving and replenishment process became an important consideration for Wilsbach to reduce the labor needed to complete those essential tasks.
With The Crane System, receiving and replenishment are optimized by the system and the layout of the warehouse. Once a receiver picks up the product on a forklift, they place the pallets on the inbound induction lane of the system, the pallet is scanned and then the system will automatically induct that pallet and take it to an assigned storage location in the system. The static pick locations located at the bottom of the system are automatically replenished by the system with no human interaction. Replenishing the remaining pick locations in the warehouse is a much easier and more efficient process as there is less replenishing to perform and with the reduced pick path all the pick locations are faster/easier to find to replenish product. Frank Jr. and his team began to look more at the benefits of automation vs. a traditional warehouse and ultimately determined (based on the factors below) that automation was the best fit solution for their business.
The Deciosion
The Wilsbach team evaluated a traditional warehouse with racking and floor stack backstock vs. The Cirrus Tech Crane System with an optimized warehouse layout. The decision came down to several key factors: 1) How much square footage would The Crane System be able to save them from not having to build; 2) How many full-time employees can be saved through the automation; 3) How much additional savings can be saved through overtime; 4) Less time physical counting product; 5) Damaged beer reduction; 6) the ability to take advantage of the tax benefit of depreciation of the system; and 7) What a Phase 2 automation would look like for their warehouse. After looking at the cost of a traditional warehouse with the additional square footage costs, the additional racking costs for the pick path, having to continue with high overtime costs, and the inability to reduce any headcount, the case for automation with The Crane System became more and more compelling.
Finally, it was necessary to determine the right future approach to automation for the Wilsbach team. The Crane System evaluation checked all the boxes for Phase 1 of automation because it saves square footage, provides annual efficiencies, and the ability to fully depreciate the system in one years’ time. The comprehensive financial analysis determined a less than 3-year Return of Investment for Frank Jr. For additional future automation a Phase 2 was developed for Wilsbach that includes an automated case picking system to focus on further automating the picking process.
Convincing Results
In September 2022 Cirrus Tech followed up with Wilsbach and discussed the success of the Crane System Implementation. Nick Bowers, the Director of Operations since 2021, and Frank Jr. provided updated information on staffing data and what is taking place in their local market as well. Nick Bowers said “The order complexity has increased in the marketplace which means the total number of orders has increased. The labor market is the same, however, turnover is down, and people are excited to come to work. The work environment is much better since the new building construction and The Crane System implementation. This is because The Crane System has brought amazing efficiencies to the warehouse and the new business processes and procedures have been streamlined by our team.”
Nick Bowers continued to say “The Crane System has brought many efficiencies to the organization and allowed them to organize the warehouse in the most optimal way possible. The pick path has been significantly reduced providing us with a 50 cases per hour per load builder bump to our pre-installation numbers. We have fewer receivers, replenishers, and load builders. The real surprise was the overtime reduction. Before the installation of the system, we were averaging 10 hours of overtime per employee per week and now after the installation of The Crane System, we are averaging only 1 hour of overtime per employee per week. This is a reduction of 9 hours per employee per week…outstanding results!”
Here is a detailed look at how Wilsbach was staffed in 2022 after The Cirrus Crane System implementation:
Wilsbach 2022 Operation Numbers (After Crane System Install)
Receivers/Put Away: 2 Full-Time Employees
Replenishers (Day Time): 1.5 Full-Time Employees
Replenishers (Nighttime): 0 Full-Time Employee
Load Builders picking package beer: 10 Full-Time Employees
Total Savings: 6 Full-Time Employees
Total Reduction in Overtime: 9 hours per employee per week
Cirrus was able to almost double the ROI (based on the 2020 projected ROI) for Wilsbach because of the post-implementation successes and performance of The Crane System and the Wilsbach team. Frank Jr. stated “This is a team effort across the board. The Cirrus team provided an outstanding implementation and has provided us with world-class 24/7 support for our system. Without them, this would not be possible. I’m also incredibly proud of our team as well and how they have adapted to the improved warehouse processes and procedures. Cirrus Tech believes in partnerships with beer distributors that have their systems. They know the importance of delivering on ROI, providing a high-class implementation, and supporting their customers. We are proud of our success at Wilsbach and the success of both teams.”
