Murray Goulburn’s supply chain innovation recognised by peers

Murray Goulburn, Australia’s largest exporter of processed food, has won the Supply Chain & Logistics Association of Australia’s Manufacturing Logistics Award. The Award recognises Murray Goulburn’s innovative Pallet Runner high density storage system, the first of its type in Australia.

The Pallet Runner system sets new standards for space utilisation and operator productivity at Murray Goulburn’s Integrated Logistics Centre at Laverton in Victoria.

Combining the density of drive-in racking with the benefits of pallet flow, the Pallet Runner system uses self-propelled ‘intelligent’ carts to handle pallets within the storage system.

The Pallet Runner carts run on rails, which pass under each pallet location on each level of the storage system.

Unlike other storage system layouts, which require multiple access aisles, Pallet Runner systems only require aisles for pallet entry and pallet retrieval, making them very space efficient - the longest single lane in the new high density store is 58 pallets deep!

The new high density store was required to support a doubling of ultra high temperature-treated (UHT) production capacity from 750 pallets to more than 1500 pallets per day at Murray Goulburn’s Leongatha processing plant.

“With minimal storage space at our manufacturing facilities, the effectiveness of product handling and storage within our Integrated Logistics Centre (ILC) is critical,” said Murray Goulburn’s National Storage & Distribution Manager, Phil Saunders.

“Our storage system partner, Dematic, carried out an extensive analysis of all storage systems and methods to establish which would be the best fit for our batch processed products and stock movement patterns.”

The Pallet Runner concept came out the clear winner, providing space for around 14,500 pallets compared to about 9000 for Drive-In Racking.

“The Pallet Runner concept offers excellent potential for manufacturers and companies that need to store large quantities of pallets of the same product to significantly reduce their storage and handling costs,” said Mr Saunders.

“As well as providing excellent space utilisation, the Pallet Runner system enables us to handle double the throughput with less than half the operators it would require with any other type of storage system, such as Drive-In Racking,” he said.

High density storage systems utilising the Pallet Runner concept have emerged in Europe and the USA in recent years, but no comparable system had yet been installed in Australia.

Murray Goulburn’s in-house WMS, Trax, controls the handling of pallets via RF terminals on the forklifts.

Because the Pallet Runner carts operate automatically and independently within the system, forklift operators are free to focus on bringing product to and from the racking without the need to drive into the rack.

The carts can be easily lifted out of one storage lane and transferred to another by a forklift, making it possible for a single cart to service multiple lanes.

A specific requirement for Murray Goulburn was for the storage system to include means by which it could pre-assemble and stage orders. The staging lanes each hold up to 34 pallets, which equates to a full B-Double truck load.

The quick turnaround of pick-up vehicles is essential for Murray Goulburn to distribute the high volume of goods stored in the new warehouse.

The Pallet Runner system makes it possible for a full load of 34 pallets to be unloaded from the store and loaded onto a truck in just 34 minutes!

“An efficient supply chain is absolutely critical to success in the dairy industry,” said Mr Saunders.

“Every day we collect fresh milk from around 2800 members of our co-operative. This milk is then processed at one of nine production plants in Victoria and Tasmania to create a world-leading range of dairy and milk powder products and ingredients.

“The combined effects of the drought and rising fuel prices made 2007 a particularly difficult year for many of our members, with the total milk intake for the year dropping from 3.6 billion litres in 2006 to 3.3 billion litres in 2007,” added Mr Saunders.

Despite this, Murray Goulburn still managed to increase sales revenue for the year by $430 million to $2.6 billion.

“This excellent performance was only made possible by the Co-operative’s manufacturing and supply chain being flexible enough to direct available milk supply into the optimum product mix, and manufacture in a manner which maximised profitability and efficiency,” he said.

The storage solution for Murray Goulburn was designed and implemented by Dematic. Colby Storage Solutions is pleased to announce that its nationwide distributor network will be offering the innovative Pallet Runner™ for the manufacturing industry.

More information:
Colby Storage Solutions,
24 Narabang Way, Belrose, NSW 2085
Tel.: 1800 COLBY1 (1800 265291)
Fax.: 02 9486 5511

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