An escalating demand for chilled and frozen food products worldwide has made refrigerated warehousing a continually expanding sector for distribution. A study published by the International Association of Refrigerated Warehouses (IARW), an arm of the Global Cold Chain Alliance, Alexandria, Va., shows 210 million cubic feet of refrigerated space was added to North American warehouses between 2014 and 2016, representing a 2.3% annualized growth rate. The study, “2016 IARW Global Cold Storage Capacity Report,” also reveals that 1.7 billion cubic feet of refrigerated space was added to warehouses from 2014 to 2016, with an annualized growth rate in cubic footage of 4.2%.
Likewise, new offerings in meat and seafood ready meals, dairy, fruits and vegetables, pizza, bakery and desserts and prepared pasta and potato products continue to fuel the growth of frozen and refrigerated foods. In fact, the frozen food sector is expected to grow globally at a compound annual growth rate (CAGR) of 5.2% between 2017-2023, according to several industry analysts. Similarly, growth in refrigerated foods during this period is expected to reach 3% CAGR.
As a result, automated three-dimensional shuttle pallet storage and retrieval systems (AS/RS) have emerged as highly desirable solutions for pallet movement and storage in refrigerated and deep-freeze warehouses. A key benefit is their flexibility to adapt to varied warehouse configurations and ceiling heights, and accommodate fluctuations in SKU counts and throughput volumes.
Challenging cold storage environment
Cold storage warehouses pose challenges for food processors, distribution centers and retailers that endeavor to have facilities operating at a high level of efficiency. Handling deep-freeze and refrigerated meats, dairy and produce can be a complicated food distribution activity requiring management of temperatures, time and lot tracking, efficient rotation of inventory and complete quality control.
Most refrigerated warehouses are manually operated, and when compared to ambient-temperature facilities, have a higher incidence of product damage, missed product rotation and wrong item fulfillment. These warehouses also have heightened facility, equipment and product damage, primarily caused by manually-operated forklifts impacting racks and doors.
While the temperature in these facilities is cold enough to safely store food products, it creates an extreme environment with difficult working conditions for personnel, increased safety issues and staff recruitment and retention problems, particularly with deep-freeze facilities. This puts refrigerated warehouses operating manually at a disadvantage with regards to throughput, order accuracy and cost efficiency.
Off-site cold storage
Supply chain executives in the refrigerated food sector are faced with considerable challenges when balancing production runs, inventory volumes and delivery schedules. Facility managers are increasingly required to store more products in existing cold storage warehouses and to retrieve them faster for growing volumes of just-in-time orders to retail stores.
Space utilization within refrigerated production warehouses is at a premium, and are running out of space. Finished products are frequently stacked on floors and aisles, which contributes to increased fork truck accidents, spillage and damaged products and lost and expired inventory.
These issues are forcing many food manufacturers to expand the footprint of their cold storage facilities. More often than not, there is not much room available in adjoining spaces or buildings. Consequently, off-site cold storage space for raw materials and finished goods is likely the only option. This requires facilities, labor, energy and equipment to manage. If the manufacturer is warehousing items that require refrigeration or freezer storage, the costs can be considerably amplified.
Third-party logistics providers (3PLs) are also a growing storage solution for food manufacturers. Although most contemporary 3PLs run highly-efficient cold storage operations, transporting pallets of product to off-site storage incurs rental costs, increased transportation costs and loss of last-touch product control, which can increase product damage and returns.
Automation limitations in high-density cold storage
These factors are influencing food producers and distributors to more closely look at their refrigerated warehousing, and how they can more cost-efficiently balance inventory against production and delivery. Key to this equation is building in automation with a high level of system flexibility that will allow changes in pallet storage paradigms, throughput volumes and system configuration. For refrigerated warehouses, this means a solution that will ensure high-density pallet storage to minimize energy costs, as well.
At first look, crane-based AS/RS come to mind. They optimize cubic space usage through their vertical stacking capability, and minimize aisle cubic footage. By eliminating the need for forklift trucks, aisles can be made more narrow, allowing 12-foot-wide aisles to become just 5 foot wide as in the case with very narrow aisle (VNA) cranes. This space can then be condensed for higher density pallet storage.
Crane-based AS/RS solve the problem of achieving high-density, automated cold storage and the problems associated with product and facility damage resulting from manually-driven forklifts, but basically, they are ridged systems. They are designed to fit a specific storage and throughput model, and if that model needs to change to a different paradigm, then the warehouse is pretty much stuck with that original AS/RS throughput model. So long as the storage game plan doesn’t change very much, that AS/RS will likely remain a highly-efficient automation solution to move pallets.
Conventional brownfield cold storage warehouses with low ceiling heights that support food manufacturing are typically not good candidates for crane-based AS/RS. Even though these facilities may have the same requirements for high-density, high-throughput storage and distribution of pallets, it is the high-bay configuration that permits crane-based AS/RS to deliver its most cost-efficient advantages. This, to some degree, makes crane-based AS/RS an unlikely option for the vast number of food processors functioning in brownfield facilities, and even further exemplifies the limitations on the applicability of these systems.
Shuttle pallet storage systems maximize flexibility in cold storage
What is missing here is the flexibility to modify system design, throughput volumes and storage configurations to adapt to changing distribution requirements. For many refrigerated food producers and distributors, this solution is emerging in the form of automated three-dimensional (3D), shuttle-based, high-density pallet storage.
Vertical reciprocating conveyors (VCRs) and a short inbound and outbound conveyor make for simple operation. That's because VRCs are used instead of fixed-aisle cranes and aisles, enabling storage locations of more than 20 pallets deep.
Here’s a list of other pallet shuttle systems that offer flexibility:
FIFO and LIFO. For high-density storage in first-in/first-out (FIFO) or last-in/first-out (LIFO) configurations, these cold storage systems permit multiple SKUs to be easily stored and accessed on any aisle and any level as needed. Deep-lane and shallow-lane storage can be accommodated within the same racking structure, without any additional equipment and little or no modification to the system.
SKU profile changes. These systems support the flexibility to change to new SKU profiles, such as to accommodate a shift away from an 80/20% mix of fast- and slow-moving SKUs to a 60/40% mix, as distribution operations require. They’re also much simpler and cost effective when compared to crane-based AS/RS, which would require a change-out of crane types from satellite to forked.
Expansion and reconfiguration. Significantly simplified when compared to crane-based AS/RS, it is just a reconfiguration of the physical rack system.
Scaling throughput. Throughput is scaled by adding or removing shuttles as needed.
Reduced energy usage
Deep-freeze distribution is the most energy intensive warehousing sector, with chilled facilities being the second most. In effect, these warehouses are giant insulated freezers and coolers that extract heat to produce a refrigerated environment. The removal of this heat comes at a hefty energy cost. Refrigeration energy costs are the second highest expense in cold storage warehouses, next to labor costs.
Refrigeration draw and automation energy usage are interrelated, as the heat generated from the automation must be removed from the facility. When energy-efficient automation is implemented into a cold storage facility, the energy and cost savings potential can be considerable. The low-energy requirement of the automated shuttle vehicles supports the initiative to reduce energy usage in cold storage facilities. The shuttles use 90% less energy than that of AS/RS cranes – 5 HP motors compared to 50 HP motors used on cranes.
Cold storage flexibility
For cold storage warehouses confronted with ceiling height and space restrictions, automated 3D shuttle pallet storage systems present an ideal solution for the utilization of existing warehouse space, as opposed to the necessity of expanding into larger warehouse facilities to accommodate manual pallet-handling operations. But, these systems can also extend into high-bay heights of 70 feet or more, directly competing with high-bay AS/RS.
These automated shuttle systems have emerged as highly flexible solutions to many issues relating to pallet movement and storage in refrigerated and deep-freeze warehouses.