Warehouse management system sets stage for prime product location, customer satisfaction

Most manufacturers strive to ensure warehouse inventory is at the appropriate level. Doing so reduces costs and enables faster response to customer demand. The process becomes far more complex when potentially hazardous chemicals are involved, especially given the need for precise storage location and inventory-level information to comply with fire codes and government regulations.
By Jim Fulcher, contributing editor January 1, 2008

Most manufacturers strive to ensure warehouse inventory is at the appropriate level. Doing so reduces costs and enables faster response to customer demand.

The process becomes far more complex when potentially hazardous chemicals are involved, especially given the need for precise storage location and inventory-level information to comply with fire codes and government regulations.

Consider Berje , a Bloomfield, N.J.-based global distributor of essential oils and aromatic chemicals to the flavor, fragrance, pharmaceutical, and allied industries. The company maintains more than 3,000 inventory items, and distributes products from facilities in Bloomfield, Los Angeles, and Chicago.

“Accuracy is important from a customer perspective because many of the products we deal with are imported—some with lead times of more than two months,” says Ajay Sanghvi, VP of operations for Berje. “One of our commitments to customers is a very short lead time—in many cases same-day shipment. That wouldn’t be possible if we couldn’t locate materials quickly.

“It’s also mandatory, when dealing with any type of hazardous material, to know both the amount and location of substances on-hand at all times,” Sanghvi continues. “We deal with some products regulated by the DEA [Drug Enforcement Administration], which can be a tough agency to deal with.”

Extensive product movement at Berje involves items that continually move around a two-story facility housing more than 40,000 containers at any given time. Inventory stored in the stockroom must be conveyed to a centralized pouring station where ingredients are mixed to customer specifications and then returned to their original stockroom location.

For years, the company relied on a paper-ticket model to track material movement and inventory levels, but the time had come to deploy an automated solution that offered greater precision, and would integrate with Berje’s manufacturing and distribution systems.

The answer was straightforward given Berje’s partnership with enterprise systems supplier Vormittag Associates Inc. (VAI) to implement VAI’s S2K for Distribution ERP application as a replacement for Berje’s homegrown solutions. And now, VAI is keeping Berje current with changing manufacturing, distribution, and marketing conditions by incorporating customized features into upgraded versions of S2K.

Company:
Berje, a global distributor of essential oils and aromatic chemicals to the flavor, fragrance, pharmaceutical, and allied industries
Challenge: Implement a warehouse system that seamlessly integrates with existing applications to reduce inventory levels, and gain precise storage location and inventory level information for more than 3,000 items to comply with fire codes and various government regulations
Solution: S2K for WMS and S2K for Distribution ERP from Vormittag Associates Inc.
Results: Inventory accuracy is greater than 99 percent; also gained ability to track transactions in detail and by sales order, handling time reduction of 25 percent.

In May 2005, Berje chose VAI’s S2K for WMS with ticket processing because it seamlessly integrated with the existing S2K for Manufacturing package, and allowed Berje to achieve all its objectives using one comprehensive solution. VAI’s software enables accurate inventory counts and real-time inventory location information because the system tracks the content of every container in inventory along with the transactions involving each container.

Berje has seen considerable improvements in inventory control and customer order fulfillment using the VAI solution. Inventory accuracy, for instance, is now greater than 99 percent—up from between 92 percent and 95 percent—enabling Berje to keep inventory at optimum levels without carrying unnecessary stock.

Berje also can track every transaction in detail and, by sales order, identify the precise container used to fill an order. Such detailed information enhances quality control and facilitates compliance with regulations governing accountability for hazardous materials.

“This implementation gave us the back-end capabilities we needed to enhance our customer service. Employee efficiency and productivity—which are essential elements of customer service—have improved as well,” Sanghvi says. “For instance, having accurate balances in barrels, and the ability to locate barrels accurately and quickly has reduced handling time by more than 25 percent.”