Founded in 1933, C.C. Dickson Co. is one of the largest wholesale distributors of heating, air conditioning, ventilation and refrigeration equipment in the southeastern United States with more than 500 employees and 110 branch locations in nine states. In 2001, as part of an aggressive growth plan for gaining market leadership, C.C. Dickson Co. determined it would move from its “paper-based” system for inventory management to a radio frequency (RF) scanner based system. The company turned to Latitude Warehouse Management System from PathGuide Technologies, a leading provider of Latitude warehouse management system for wholesale and industrial distributors.
WMS Improvements in the Warehouse
Since deploying Latitude, C.C. Dickson Co. has experienced the following productivity results:
- Pick productivity has increased by almost 340 percent while maintaining the same level of warehouse staff. (In 2001, prior to the Latitude deployment, 41 warehouse employees processed about 6,000 lines per week. In 2007, 34 warehouse employees now process about 17,000 lines per week.)
- Inventory management accuracy consistently runs at 99.9 percent.
- Inventory levels were reduced by more than two-thirds. C.C. Dickson Co. now operates one distribution center at 80 percent capacity compared to three distribution centers at 60-75 percent capacity each.
- Shipments from the distribution center to branch stores decreased by three days.
Latitude is a software suite that automates warehousing and distribution to provide real-time online information about all inventories. Latitude automates all operations from receiving and order picking to manifesting and truck route/stop management. It integrates seamlessly with ERP business systems and is designed to help industrial distributors pick, pack, and ship orders faster and more accurately, resulting in greater productivity and profitability.
Warehouse Communication Challenges
Prior to Latitude, C.C. Dickson Co. utilized a paper-based system and its branch stores operated autonomously with minimal communication between branches. Under the paper based system, warehouse employees were required to memorize product names, as well as the specific location of each product within the warehouse.
The company was running a “spoke and wheel” operation where inventory would be transported from distribution center to distribution center before arriving at a branch location. Regular shipments took three to four days to reach an outlying branch, and branch transfers could take up to two weeks based on the trucking route.
Latitude Warehouse Management System – “The Best Fit”
C.C. Dickson Co. sought a wireless (RF) warehouse management solution that would provide branch stores with real-time information and improve communication from a distribution perspective. The company also aimed to increase productivity and efficiency within the distribution centers.
“We considered several solutions on the market and Latitude really was the best fit in terms of offering all the warehouse functionality we needed at a reasonable price,” said John Ponder, logistics director at C.C. Dickson Co. “We didn’t want something overly complex, and we appreciated that Latitude integrated with our Prophet 21 ERP system, which enabled us to have a robust solution without making any sacrifices.”
Latitude was deployed in the main distribution center located in Rock Hill, South Carolina, as well as in two smaller distribution centers. At the time, C.C. Dickson Co. was moving about 1,000 lines a day through the main center. After nearly six months of using the new system, the company determined it was holding far more inventory than needed. C.C. Dickson Co. subsequently was able to close down the two smaller distribution centers while continuing to significantly increase overall productivity.
“With Latitude we could clearly see our inventory and determine what was needed as well as identify duplicates,” continued Ponder. “Since closing the two centers and consolidating inventory we have drastically reduced distribution center total inventory levels – they have yet to reach the levels they were at with the three centers. By reducing this inventory we have been able to move more inventory to the branches for improved point of sale availability. As you can imagine, the cost savings and improved customer service have been phenomenal.”
Higher Pick Productivity, Faster Service
With Latitude, employees are quickly directed to items within the warehouse and no longer need to memorize product names and locations. With the increased efficiency brought by Latitude, C.C. Dickson Co. has maintained the same level of warehouse staff, but pick productivity has increased almost 340 percent. Pick productivity continues to grow approximately 25 percent annually. Inventory management accuracy consistently runs at 99.9 percent.
Transportation times have also significantly improved. Today, when a product ships out of the central distribution center it typically arrives in one day (rather than three to four days), and branch transfers now take three days maximum (rather than two weeks).
“Latitude has helped us be more competitive in the market by providing the branch stores with real-time information about inventory availability,” continued Ponder. “Now when a customer walks into a store and needs a product that is out of stock, the store associate can immediately find the product and have it delivered the same day. This level of service sets C.C. Dickson Co. apart.”
Aggressive Warehouse Growth Plans
Today C.C. Dickson Co. is one of the most technologically advanced HVAC/R distributors and is a company well poised for growth. It is currently on track to add 20 new branch stores within the next three years and anticipates the ability to increase sales by 75 percent without expanding the size of its current distribution center.
“Our goals for growth wouldn’t have been feasible prior to Latitude,” says Ponder. “Our relationship with PathGuide has been a critical part of our success and it’s key to our strategy moving forward. We’ve been very pleased with PathGuide’s openness to new ideas and solutions, as well as their commitment to our growth.”