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ATC Logistics &
Electronics increases capacity, accuracy in the face of growing
customer demand
?The technology we use is superior?
Client
 ATC
Logistics specializes in forward logistics, returns, repair, and
light remanufacturing of electronics for a variety of Fortune
100 customers. The company services a variety of electronics
ranging from cell phones to GPS systems at its Fort Worth, Texas
distribution facility.
The company is dedicated to excellence in a competitive
market. ?We know where all products are at all times,? said
Senior Engineer Chris Miller. ?What we say we?re going to do, we
do. We far exceed what we?re contractually obligated to do. We
add a tremendous amount of value across the process that allows
the customer to minimize inventory levels as well as resell or
redistribute phones.?
The Situation
ATC provides dealer returns and undeliverable phones
services for major cell phone manufacturers. The company has
achieved 99.5% quality levels and a 15.6% annual growth rate
over the last four years. Due to that growth, ATC needed to
expand, particularly within its cell phone returns operation.
In 2003, its testing and repair capacity was 220,000
handsets. It targeted the capacity to process 3.2 million in
2005 with a 50% additional increase in 2006.
Objectives for the new material handling system
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The company wanted the increased capacity; enough
to process tens of thousands of phones every day, as demand
warranted. ?We needed to be able to receive, process, scan,
repair, and ship more phones, faster,? said Miller.
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ATC needed to merge its WMS system with controls to
increase the ability to sort higher volumes. ?Some of
the WMS interfaces and transfers became requirements from
our operations group, and the ability to sort higher volumes
became a priority. That?s what drove the design and layout,?
said Miller.
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Another issue the company faced was a tight
implementation deadline and the need to stay operational
during the transition to the new facility. It had to
happen quickly and without downtime. ?We had only eight
weeks to move two of our conveyor lines from the older
building,? commented Miller.
-
Varied carton sizes had to be conveyed. As
manufacturers introduce new phone models, new cartons and
packaging had to be acceptable into the system. Because it
had to support phone packaging that didn?t exist when the
system was designed, its scanners, controls, accumulation,
and sortation systems needed to be flexible.
?We wanted to make it flexible enough to receive returns
from multiple different channels,? Miller said. ?We didn?t
want to shoehorn ourselves into too specific of a line.?
-
The system had to correctly feed phones into ATC?s
repair centers without much manual interference. The
company wanted more precise traceability. It needed to know
where any particular item was in the system at any
particular time. ?We track all inventory down to the serial
number,? said Miller.
The new system in detail
 The
new facility integrates the best parts of ATC?s previous system
into a new operation with heightened capacity, increased
throughput, and precise levels of control and tracking.
Returned phones are received into the system in cartons,
which are sent into a box cutter machine that automatically
opens shipping cartons. Once opened, the cartons are conveyed up
an incline to the middle level of a three-tier conveyor line,
and then to workstations for initial processing. The lower line
is a takeaway line, and the upper level is for discarded
cartons.
?We have an operator interface that assigns credit to the
returning party and receives it into our inventory within the
WMS (warehouse management system),? said Miller.
Operators take boxes from the infeed conveyor and place them
on workstations, where returns paperwork is scanned, then
labeled either (1) Return to manufacturer, (2) Repair, or (3)
Scrap.
ATC Operators discard shipping cartons into an overhead
trash conveyor and place phones (now in retail boxes) onto the
takeaway conveyor line. The phones are conveyed to ATC?s
sortation mezzanine, where they are scanned for their final
destination. ?We use conveyors tied in with automated systems
and scanners to divert phones to one of thirteen different
locations, based on what work that phone needs to have done,?
Miller said. ?There are two repair cells. 70% of what we receive
goes to them.?
As it assigns phones to the correct repair cell, the system
scans and adds them to the repair inventory while simultaneously
removing them from general inventory. Once phones reach a repair
cell, they are diagnosed and either repaired or marked as
unrepairable. Repaired phones are conveyed up an incline back
atop the mezzanine. They are scanned and diverted by make and
model to palletized storage or other destinations. Again, they
are sorted automatically on the mezzanine and automatically
delivered to the correct area.
A tight timeline met
?It was an extremely tight timeline choreographed with the
move from our old building, and we didn?t miss a beat,? Miller
said. ?We had the first two lines completely built out in three
or four weeks. We were able to move our operation to those
lines, and then we were able to move some existing conveyor here
to create a third line. We consolidated two existing buildings
into this one. The choreography and Cisco-Eagle?s ability to
work with our very aggressive timeline was impressive.?
During the project there were midstream changes. ?Those
additions didn?t throw off the timeline,? said Miller.
Capacity, traceability gained
ATC got the additional capacity it needed. ?We would never
be able to handle the capacity that we can now in our old
facility,? said Miller. ?We were able to remove labor from the
process by using conveyor system and its transfer and sortation
features. It also provides order to the layout. It gives us
traceability.
 ?We
know where everything is. The system as far as product moving
and traceability has been terrific.?
The operation depends on being able to understand where a
phone is at any given point, so traceability was important. ?The
system creates inventory accountability,? Miller elaborated.
?Now, I can prove that a functional area received something and
that it made it to an area and that it should be there. If it
passed a particular scanner, it went there.?
ATC is able to leverage its repair capabilities more effectively
than ever. ?We?ve significantly increased our repair volume, ?
Miller noted. ?The system allows us to sort to repair cells.
It?s eliminated manual cart transfers. It helped us track any
lost inventory.?
Organizational & ergonomic improvements
?We did things to increase safety and ergonomics,? said
Miller. ?The automated box cutters reduce injuries and increase
speed. It lets us keep a person at a station instead of walking
around. We have an air conditioned facility, high volume fans,
and ergonomic mats.?
Organization and housekeeping were improved. ?Just look at
our ability to remove corrugated box trash,? Miller commented.
?We?re removing 35 tons of corrugate boxes a week with the
system. Think about trying to do that without conveyance?it
would be a total mess. We had removed it by gondola and hand in
the past. That would kill us today if we had to remove it at our
current volume.? Besides helping ATC deal with its corrugate,
the corrugate conveyor also reduces repetitive motion injuries.
ATC opened its layout and floor space. ?The mezzanine lets
us transfer product from one part of the warehouse to another
and still allow for equipment and people to transfer without
having to crossover ladders and bridges,? said Miller. ?It keeps
aisles open.?
The system has been dependable despite being mechanically
more complex. ?It?s been maintenance free,? said Miller. ?The
conveyor has been consistent and reliable. Mechanically it?s
been very sound.?
 Within
the state-of-the-art system, ATC found ways to save money. For
instance, instead of manufactured workstations, it installed
custom-welded benches. ?The value on the custom welded
workstations was very good,? Miller said. ?We probably saved
$400 to $500 per station, with more than 120 stations. And they
are rock solid.?
A competitive advantage for ATC and its customers
ATC?s material handling system gives it a competitive
advantage it leverages in marketing efforts. While its
competitors sort manually and deploy hundreds of employees
shoving carts, ATC utilizes state-of-the-art automation to boost
throughput, inventory control, and responsiveness to customer
needs. This embodies the company?s commitment to people,
process, and technology. ?We show the system to potential new
customers constantly,? said Miller. ?It?s a marketing tool that
helps us showcase our technological advantage over competitors.?
People, Process and technology
It all comes down to ATC Logistics & Electronics? commitment
to compete by having superior people, processes, and technology.
?Our people are superior,? said Miller. ?The technology we
use, from the conveyance system through WMS through IT is
superior. Then, the processes we use, being ISO certified, help
us keep our edge. Incorporating all of these things helps us
stay ahead.?
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