Increasing the efficiency in space usage for the Damen Shipyards central warehouse in Gorinchem

Abstract

Can Damen return to the old warehousing facility? The short answer is yes, but no. When viewing the central warehouse as a distribution center, the required space can be reduced to much less than is available in the old warehouse. However, because the warehouse is often used as a storage facility, a return is made impossible. At this time, 4200 m2 is used for receiving the goods, 8200 m2 is used for temporary storage, and 6400 m2 is used to create the shipments. By changing the categorization of the incoming goods and going to a one-buffer system, the section for receiving goods can be reduced to less than 1000 m2. The temporary storage now uses 8200 m2, but this is caused by the average time in storage of almost 9 working days (Little’s law). This means that goods are 9 working days too early (on average). By changing the mindset that ‘then at least we’ll have it’ internally and by giving clear feedback internally and to the supplier, this can be brought back to less than 1200 m2. By changes inside the central warehouse (disregarding the changes outside of the span of control of the central warehouse), the current amount of goods can be stored more efficiently in 3000 m2. By generating a continuous flow for the outgoing goods and by eliminating the enormous time loss created by slow scanners, the outbound process can be done with less than 2000 m2. This would easily allow a return to the old central warehouse, offering 6700 m2. All this being said, Damen keeps on storing more and more goods for extended periods of time and both warehousing facilities become fuller and fuller. This is caused by leftovers from finished projects (ranging from custom made propellers to more standardized parts). Some of these leftovers have been there for more than five years and might still be there for five more because they have once cost a lot of money. Besides this, canceled or delayed projects form a large part of the storage area and according to Damen ‘this will never change’. On top of all of this, Damen has expressed that 90% of the flow of goods only accounts for 10% of the value and that this should just ‘be there’ so that it won’t delay the other 10% of more costly items. Although this is understandable, this can be translated to a lack of willingness to change the attitude ‘at least then we’ll have it’. When regarded as a distribution center, there will be no problem in returning to the previous location with some changes in the process. When including the enormous amount of stored goods that is continuing to grow, there is no possibility of returning and in a few years, even the total of 24000 m2 will not be enough.