Over the last decade, BMW Group Australia has seen such unprecedented growth driven by consumer demand that not only have sales increased by 85% but its Melbourne warehouse has had to cope with an increase from 9,318 vehicles sold in 1997 to 17,197 in 2007. Coupled with a model offensive that broadened the appeal of the brand, BMW decided it was vital to review its parts logistics strategy in terms of capacity and service.
As a company that ensures that premium customer service comes first, it was decided that a twin warehouse strategy was the best solution to achieve its premium service objectives of optimising parts availability and maximising speed-of-delivery to dealers and customers – irrespective of their geographical location.
The strategy was two-fold: 1. design a new national distribution centre in Sydney, and 2. re-focus the use of the Melbourne distribution centre to become a satellite warehouse. The resultant project took over three and a half years to become a reality and BMW has now officially opened its new state-of-the-art national distribution centre (NDC) in Moorebank, Sydney.
Situated adjacent to the M5 motorway, the Moorebank NDC allows rapid access to all local and interstate road networks, ensuring speed-of-delivery to BMW dealers across the country.
According to Martin Ellis, parts operations manager, BMW Group Australia, the decision to re-locate the NDC to Sydney was due to 58% of the parts being sold into dealers across New South Wales and Queensland, with 48% moving into the Sydney and Brisbane metropolitan regions. Additionally, the twin warehouse strategy enables two deliveries per day to Sydney and Melbourne metropolitan dealers that account for 60% of the parts business.
“Our new facility stocks the full range of parts and accessories for BMW, with over 30,000 SKUs. Moorebank NDC will supply fast- and medium-moving stock to the northern and central regions, and slow-moving stock nationally. Our target FPA is 93-95% ex Moorebank and 85-87% ex Mulgrave,” Mr Ellis said.
The Mulgrave satellite warehouse will stock fast- and medium-moving stock, and service 85% of the southern region requirements directly with over 13,000 SKUs. It will also hold the centralised stock of LifeStyle and motorcycle rider wear.
The new facility in Moorebank has 12,600 square metres of warehouse, with a provision for expansion to 20,000 square metres to handle future growth of the company. BMW’s long-term planning indicates that the second stage would be considered in approximately 2012.
“A critical component of our new NDC is the turnkey supply of a state-of-the-art racking, mezzanine and storage system, designed and installed by SSI Schaefer International. The racking height is 7 metres, and the three levels of mezzanine are approximately 7.5 metres in height. The footprint of the mezzanine is approximately 1,300 square metres,” he said.
SSI Schaefer International custom-built the pallet racking I600, the modular shelving R3000 for storage of small and medium parts, the mezzanine, lighting system, sprinkler system, goods hoist, mesh wall panels, shelf/rack and aisle labelling and modular shelving for storage of bulky and body parts. Schaefer also organised all the local authority consents so the building could be habited, including development application, construction certificate and occupancy certificate.
Selective pallet racking I600
The Schaefer I600 pallet racking system offers BMW the flexibility towards future modifications and integration of picking levels to meet new and modified product ranges. Depending on the weight and number of storage levels, multiple storage locations are possible with the Schaefer I600 and take into consideration BMW’s space utilisation economics. Bay load capacities up to 28 t are possible with the I600 system and have upright widths of 90 mm or 115 mm, with height adjustability at 50 mm intervals. Mesh decking was supplied to suit large crates, European pallets, special fittings for muffler pipes, and irregular items.
Shelving system R3000
The Schaefer R3000 shelving system was an easy-to-assemble, boltless and modular design. Bay widths are 994 mm and shelf depths 300, 400, 500, 600 or 800 mm with, various heights for single and multi-level systems. The R3000 system provides BMW with a wide range of accessories such as vertical dividers, drawers system doors, plastic parts containers, side and back panels, and has a maximum bay load of 5,000 kg. The Schaefer R3000 modular system is suitable for future expansion in BMW’s NDC.
The Schaefer mezzanine was custom-built for BMW’s purposes and has the highest load capacity and material quality available. It is a modular system with safety staircases, guard railing and kick-plates as per all applicable codes and regulations.
Schaefer installed light fixtures across the aisles for better luminosity, to assist in bar code reading and obstruction-free handling of big and bulky parts. Exit and emergency lighting was provided to suit BCA requirements.
Goods hoist system
Schaefer installed the BMW goods hoist system that serves three levels of the NDC and has a load capacity of 2,000 kg. The BMW goods hoist provides touch-button automation, incorporating system run timer, landing send/call buttons, emergency stop buttons and safeguards against the danger of the platform moving with one of the doors open.
Also as part of the Schaefer scope to meet local authority requirements, a sprinkler system including smoke curtains was installed to suit Australian standards. These were located in the R3000 shelving, mezzanine and the I600 racking.
“The team at BMW had to work extremely closely with SSI Schaefer International, and in particular Allan Slingsby and the local team, for close to eighteen months prior to installation to ensure that the mezzanine and racking was designed and installed to spec and on-time, within budget and complete with all the required local certification, so the building was habitable.
“The success and on-time completion of the Schaefer installation was critical to BMW meeting all subsequent ramp-up deadlines, and having the facility fully operational on schedule. Allan Slingsby and the team at Schaefer were extremely professional and competent, overcame a number of unexpected hurdles outside of their control, and achieved all of the deadlines set for them. The result is a state-of-the-art mezzanine and racking system that makes our Moorebank NDC truly world-class,” Mr Ellis said.
In addition to the new NDC, BMW is now operating a comprehensive barcoding system that covers goods receipt, despatch, stock audit and bin management, and incorporates instant file update and tracking.
The Moorebank NDC is a demonstration of the commitment that BMW Group Australia has to their business partners, the dealer network and to their owners.
“By providing premium service and exceeding customer expectations, we strive to underpin our brand promise, and in so doing support further growth of BMW in Australia,” Mr Ellis said.
With the new Moorebank NDC and the satellite warehouse in Mulgrave, BMW can now deliver 95% of its daily orders overnight by road, with the balance being supplied overnight by air. Dealers across the country are now assured optimum speed of delivery and customer service, and with sales targeted to reach 20,000 vehicles by 2011, BMW has achieved its goal of premium customer service literally overnight.