Donning virtual reality goggles in a GE Appliances warehouse, employee Blake Meade operated a forklift simulator to move cardboard boxes of appliances from a trailer to a designated spot in a virtual warehouse.
A few feet away, fellow GEA employee Blake Allen used radio-frequency transmitters, GPS and cloud computing to keep track, in real time, of hundreds of trailers in a warehouse in Texas.
Nearby, employees from GEA and partner Quant demonstrated smart forklifts equipped with lasers, cameras and a locally developed, patent-pending shock-absorbing system that reduces the frequency with which appliances are damaged during transport.
The use of the latest tech and local innovations are part of Louisville-based GE Appliances’ $150 million national investment to make its distribution system smarter, faster and more responsive to customer needs.
The logistics investments initially will improve the company’s bottom line, but the company also expects its improved customer service to boost revenue in the long term. The company can deliver products to 90% of the country within one day. One of its appliances gets installed every four seconds.
“We are growing at a very aggressive clip,” Mark Shirkness, the company’s vice president of distribution, told Insider last week as he stood in the company’s Louisville warehouse, called AP10.
At two million square feet, the warehouse dwarfs the production facilities that are lined up on its east side. Conveyors snake their way from the manufacturing plants to the warehouse to feed it with machines including refrigerators, washing machines and dryers.
The warehouse employs 130 and contains about 500,000 appliances at any point — though an entirely new set of products is cycled in and out of the facility every six weeks. That’s faster than the competition, Shirkness said, and with the new investments, GEA expects to widen the gap even further.
Logistics and warehousing have received a lot of attention in recent years primarily because of Amazon, but Shirkness said that GEA’s distribution system is fundamentally different from consumer goods retailers: Amazon has been transforming the person-to-goods warehouse, where people stock and pick up light-weight items.
However, GEA focuses on innovating the goods-to-people warehouse, in which heavy appliances are moved to people.
And, Shirkness said, companies like Amazon ultimately still put stuff into inventory.
“And that is where we philosophically divide. … We don’t want inventory,” he said.
That means when a product comes into a warehouse, it is moved, as quickly as possible, to the loading dock from where it will leave that day or the next day to be taken to a retailer or one of the other 11 GEA warehouses.
“Our whole idea is that when a product comes in, and I scan it, at that point in time, I’m asking who needs me?” Shirkness said.
The approach is prompting the appliance maker to change the layout of its warehouses. Current warehouses may have 100 dock doors, but new ones, including the recently opened $55 million Area Distribution Center in Commerce, Ga., have more than 200, to enable more trailers to back up to the warehouse to get products out quickly.
“We’re all about time on concrete,” Shirkness said.
Beyond super-sizing its existing warehouses, GEA also is adding new ones. It expanded warehouses in Dallas in June of last year and in Denver in February. Next month, Shirkness said, the company will double the size of its warehouse in Jacksonville. Warehouses in Sacramento and yet-to-be-disclosed locations will follow.
While investments in the logistics system are significant, Shirkness said their improved efficiency generate a good return. GEA might expand the size of a warehouse by 33%, but thanks to the new layout and the new technologies, it can increase the warehouse output by 100%.
As customers see improved response times and fewer damaged appliances, GEA expects to gain business and market share. It’s all part of the stated goal to become the country’s leading appliance maker.
Company leaders said GE Appliances is growing, but they did not want to talk about by how much, or whether the growth exceeds the industry average. The global appliance market is projected to grow at an annual 2.6% through 2023, according to ResearchAndMarkets.com.
Tech tracks trailers
Radio-frequency identification and GPS technology are helping GE Appliances with a fundamental challenge: keeping track of trailers.
With hundreds of trailers per warehouse, that’s not an easy task.
Truck drivers used to steer their rigs onto the parking areas surrounding the plant and leave trailers in assigned spots. At least that was the idea.
“We used to spend way too much time looking for (trailers) that had been lost,” said Greg Gilbert, senior warehouse operations analyst.
When a driver comes in for a pickup, and the trailer he is supposed to drive to a store is not in the right location, he can lose valuable time tracking down the shipment.
Before GEA employees installed the new high-tech system, warehouse workers had to walk the parking lots twice per shift, or six times per day, to record the location of each trailer by hand and transfer the information into spreadsheets.
“Lots of wasted hours,” Gilbert said.
Now, Blake Allen, the company’s warehouse integration specialist, can generate on a computer screen an overhead display of any of the company’s lots and immediately see which trailer space is empty, which trailer space is occupied and which trailer contains products.
He also can view, in real time, when drivers make a pick-up — and even gauge their performance in moves per hour.
“Knowing where your stuff is is awesome,” Allen said.
When trailers enter a yard, they receive an RFID-equipped tag. A tablet in the driver’s cabin will tell the driver where the trailer needs to go.
Shirkness said the new system also improves the company’s information sharing with vendors: At any time, the company can tell vendors what product they have in the lot and in what location.
In the last four weeks, the new system has improved the number of trailers that have been moved in and out of the warehouse by 20%, Shirkness said.
“You want to be turning your inventory as fast as possible,” he said. “Any asset that sits is just burning cash.”
Shirkness said efficiency goes beyond figuring out the best way to get people to the goods and goods to the dock to get shipped. Efficiency also means improving how workers handle products to reduce damage and product loss.
But training workers to gain forklift proficiency — which means moving a certain number of pieces per hour without damaging them — takes about nine months, which is far too long. Shirkness said GEA can’t hire people in February and keep them on the payroll for nine months so they can help meet the surging demand on Black Friday.
With virtual reality training, Shirkness said he hopes to cut the training time to nine weeks.
Blake Meade, Area Distribution Center program manager, recently sat in the forklift simulator, put on a virtual reality headset and demonstrated an intermediate training program that required her to manipulate controls on the simulator to move boxes to a designated spot on the warehouse floor.
The exercise required her to back up the forklift, and to do that, she had to physically turn around while sitting on the simulator to get a view of what was behind her virtual vehicle.
Meade, a mechanical engineer by training, said the VR headset places operators in a realistic environment and makes them feel as though they’re actually driving a forklift in a warehouse.
The VR training essentially resembles a video game tutorial, introducing drivers first to basic controls before ratcheting up the difficulty. A driving trainer can view on a monitor what the trainee sees in her headset.
Shirkness said the simulator accelerates training but also allows GEA to more quickly identify applicants with an aptitude for driving forklifts.
Operating the machines, especially while moving thousands of dollars worth of heavy appliances, can be challenging. The products in the warehouse often are stacked in sets of five, and getting the forklift blades between two refrigerators that are 22 feet from the ground takes a lot of practice and good hand-eye coordination, especially if you want to complete the task with a certain speed and accuracy.
Shirkness said exposing trainees to difficult challenges in virtual reality also instills them with confidence when they encounter a similar situation in the real world, much like pilots benefit from flying in a thunderstorm in a flight simulator before they deal with difficult weather at 35,000 feet.
To make employees’ jobs easier, both on their bodies and the products, GE Appliances has focused on tech and employees’ creativity. Inspired by advances in the automobile industry, the new forklifts come with cameras so that operators can get a better view of where the fork is hitting 20 feet in the air. They also come with lasers to alert drivers of a possible collision.
And a team of GE Appliances and partner Quant has developed a patent-pending shock-absorption system that reduces the likelihood that forklift drivers damage appliances. Everything on the system, from design to machining, was done in-house.
Forklifts weigh about 12,000 pounds and exert a horizontal force of 3,500 pounds onto corrugated boxes that envelop 500-pound appliances.
To minimize damage to boxes and appliances, drivers, until now, had to develop a feel for how to slow their vehicles before they made contact with boxes to push them into trailers. If they were off by just a little or failed to pay attention for a fraction of a second, the force of their forklifts easily damaged the corrugated box or even its contents.
Alan Ricchio, first shift maintenance supervisor with Quant, said the new shock-mitigation system works with truck airbags that are placed between the forklift’s backrest and mast.
The system measures pressure inside the airbags, and if a driver comes in with too much speed, the tech absorbs the excess force that otherwise would have been exerted onto the cardboard box.
The system allows the companies to reduce the horizontal force from the forklift from 3,500 pounds to 1,500 pounds, and, Shirkness said, if that’s still too much for a customer’s liking, the maximum force can be reduced even more.
He said the system may add a few thousand dollars to the cost of a forklift, but if a driver damages a handful fewer appliances, the upgrade pays for itself. Over the 10-year life of a forklift mast, the company expects to generate an “incredible payback” by preventing damage to hundreds or even thousands of products per vehicle, Shirkness said.
A GEA team in Louisville also has developed a more ergonomic appliance dolly, though the company could not say much about it yet. Shirkness said the company wanted to get employees thinking about improving an existing tool that had not seen much change over the years to learn how to innovate. A patent on the new dolly is pending.