The art of controlling logistics costs stretches beyond the bigger picture concerns such as warehousing and transportation to the smallest details such as maintaining distribution center equipment at the lowest possible level. The public refrigerated warehouse operated by Total Logistic Control in Rochelle, Illinois, provides a good example of using some of the latest equipment technology to control operating costs.
The Rochelle center was built in 1986, originally a part of the Wiscold warehousing network. It is 90 miles west of Chicago and serves as a holding and distribution center for manufacturers serving the wholesale grocery, supermarket chain, and foodservice markets. Some of the customers served from the 14.1-million-cubic-ft facility include Jewel-Osco, the midwestern division of Albertson's; Dominick's supermarket chain in the Chicago area; and Roundy's, a wholesale grocer and retail chain operator in Wisconsin. In addition, the Rochelle facility serves Sysco, Gordon Foodservice, and US Foodservice. Wiscold and TLC have merged into a single operation as a part of the C2 Inc group of companies.
Total Logistic Control is a logistics provider with a network of 12 warehouses providing more than 34 million cubic ft of storage and a truckload motor carrier serving the warehouses as well as providing simple transactional transportation services. As a truckload operator, TLC runs a fleet of almost 170 tractors and more than 200 trailers. In addition, it provides dedicated carriage for a number of supermarket and other logistics customers. When the dedicated equipment is added to the mix, the TLC fleet totals 355 tractors and 400 trailers, nearly all of them refrigerated. The services of more than 3,200 other motor carriers are used by TLC's freight management group, contracting transportation from more than 150 truckload carriers in any given month.
Small local fleet
A portion of the TLC fleet is assigned to Rochelle to provide delivery service to customers within a 200-mile radius. “We have eight tractors and 12 trailers for local area service,” says Don Romniak, transportation manager. “Our longest haul is to the Gordon Foodservice facility in Grand Rapids, Michigan.”
In a warehouse such as Rochelle, energy efficiency and maintenance levels are critical factors in cost control. Rochelle maintains its primary storage areas at temperatures from -15° F to 0° F. These low temperature zones open onto a dock refrigerated to 36° F through 22 internal freezer doors. In addition, the building has 67 dock doors for trucks and 14 doors for rail loading and unloading.
When the Rochelle warehouse was built, it used conventional hard-core doors for the openings from the freezers to the docks. They were selected, because hard doors provide a good temperature seal for freezer rooms used to store ice cream, says Tom Zhe, plant engineer in Rochelle. However, hard-core doors operate relatively slowly and are susceptible to damage by loaded fork trucks in high traffic areas, he says. Once hit, a hard-core door panel is pretty well ruined, Zhe says.
Lost sealing properties
The real problem with door damage is that the panels lose their sealing properties once they are damaged, a situation that causes difficulty in maintaining freezer temperature without driving up energy costs, Zhe says. If the damage to a door panel is bad enough, the door stops operating, and traffic has to be rerouted through the warehouse while repairs are made. That cuts productivity and drives up costs, he says.
Door repair is fairly expensive. Zhe says that Rochelle has had to replace an average of five door panels per year at an average cost of $3,000 per panel for an annual maintenance cost of $15,000 for door repair.
The high maintenance costs have led TLC to install new doors with more flexible panels. Sourced from Rite-Hite Doors, the new equipment uses panels with three inches of insulation. They provide good insulation and are damage resistant at the same time. A wire loop sensor in the floor outside the door causes the door to open as a moving fork truck approaches the door. The door opens automatically, remains open for about four seconds, and closes after the equipment has passed through. High speed operation helps prevent warmer air from the dock entering the freezer rooms.
If the soft-core doors are hit, damage is usually slight, Zhe says. The most common maintenance action is popping the door panel back into its track after it has been struck. The new doors cost about $13,000 each, and TLC has, so far, replaced 18 of its original doors with the new equipment. “We are replacing the original doors as we damage the older ones,” Zhe says. “We think we get a pay back in lower maintenance costs in the first year of ownership with the new doors. They've taken a few hits, but we almost never hear about it, because the doors continue to operate.”