About 23% of logistics costs in the US and 39% in Europe are due to warehouse capital and operating costs. Given the extent of this impact on companies’ supply chains, cost-effective management of warehouses has always been considered critical to the success of businesses. Companies seem to incur these costs mainly by the use of tracing technologies to empower appropriate item allocation.
Imagine a large warehouse facility. Trucks are constantly arriving and leaving. Often they show up late or require a specific dock that is being used by someone else. Costs can easily skyrocket. For instance, it takes an average of 30 minutes to unload 24 pallets off a 48-foot trailer, including putting the pallets away. And, according to Business Insider, 2.5 hours is the average time drivers wait for a truck to get loaded once they’ve arrived on site.
Let’s assume it costs $50 per hour (truck driver wage + gas), and that the delay costs are, on average, $100 (not including the 30min needed to unload the truck, which is considered productive time). If we assume a warehouse discharging 50 trucks per day, 5000$ can be incurred daily due to waiting time. If we assume that the warehouse is open 300 days per year… we get an annual cost of $1,500,000 — just in time spent waiting. Multiply that by the number of warehouses, and the costs skyrocket across the industry.
Dock optimization in warehouses is, therefore, a vital concern for carriers, suppliers, and shippers. Businesses that optimize their slots and automate their processes gain a huge competitive advantage. In terms of costs, avoiding congestion and not having trucks waiting around is a boon, especially as the supply of drivers is becoming increasingly scarce. Shippers who can offer predictable delivery times are in high demand.
Get Optimizing With Dataiku
Dataiku understands these challenges — that’s why we’ve built an out-of-the-box solution specifically to tackle them. We know that most warehouse managers wake up everyday with the same key questions on their mind:
- Do I have enough workers tomorrow to ensure the easy and smooth unloading of all trucks expected to arrive at the warehouse?
- What will be the usage of my docks this afternoon?
- I have an unexpected truck coming in 1 hour. How to reorganize the warehouse to minimize the overall waiting costs?
- I have no information about the trucks. I was supposed to unload them 30 min ago already. When will they arrive? What is the expected delivery delay and how to adapt the planning of the docks?
Our aim is to bring the answers to these questions to your fingertips. With our Delivery Dock Optimization solution, warehouse managers and production planners can quickly integrate data from their truck providers to deliver a comprehensive and extensive view of planned schedules, analyze performance, run scenarios, and optimize dock slotting by reallocating slots to adapt to potential delays. Eased integration with Shippeo allows near-real time and more accelerated optimization, paving the way for more resilient management of the supply chain and logistics.
How Does It Work in Practice?
The goal of the Delivery Dock Optimization project is to provide warehouse managers and supply analysts with a solution to monitor the warehouse’s activities as well as to predict potential impacts on transportation and anticipate congestion.
This project is built in partnership with Shippeo, a real-time data provider.
With Delivery Dock Optimization, warehouse managers and supply analysts will be able to:
- Track trucks and visualize warehouse KPIs (e.g., the average time in the warehouse for trucks, the average delay of trucks, dock availability, etc.)
- Anticipate and limit truck wait times(e.g., reroute a truck to another warehouse if the costs are too high, send alerts to the warehouse manager in case of significant change in dock allocation, etc.)
- Improve warehouse management (e.g., forecast the number of workers needed on a given day to manage the incoming trucks, plan activities accordingly, embed optimization checks within your processes, etc.)
From a user perspective, the project is made of the following easy-to-use components:
A Structured and Comprehensive Flow
Adapt the flow to your processes and ingest all relevant data (warehouse data, tracking data, etc.) to improve your warehouse management.
User-Friendly Interactive Dashboards for Operational Insights
Transform the data from your different systems into a unified view where you can get operational insights at different granular levels (trucks, docks, etc.)
Quickly change your constraints thanks to the WebApp
…Optimize Your Docks
Optimize the dock allocation running the scenario with the entered parameters.
Quickly and easily send alerts to the manager of your warehouse and your central supply chain analyst.
Move to Near Real-Time With Shippeo
Leverage Shippeo to seed data integration from all your truck logistics providers and move to near real-time delivery dock optimization. Benefit from improved data freshness and forecasted ETA by Shippeo to significantly reinforce your truck delivery management strategies.