10.12.2018 //
Juha Peltonen
Timo Porthan

The immense volumes of the logistics centre

Up to a thousand lorries a day stop at the S Group’s new logistics centre in Sipoo. A quarter of the incoming goods comes from the Vuosaari harbour. – In terms of time, we’re now much closer to the harbour, says logistics manager Mikko Kymäläinen.

Inex Partners’ new grocery logistics centre, located in Sipoo right at the Kerava border, is an enormous facility. For the 21,000 product items sold at the S Group’s grocery stores the centre features a surface area of 200,000 floor square metres and a volume of 3.5 million cubic metres.

The introduction of the logistics centre has been staggered over a period of two years and eight months, which ends in February 2019 according to the schedule. Everything is on schedule, as only part of the logistics of frozen foods remains unmoved.

From there on, just over half of the S Group’s retail grocery goods pass through the logistics centre. One third goes from suppliers to Inex Partners’ regional terminals, eleven of which are located across Finland. Out of these, the Joensuu and Rovaniemi terminals are transfer delivery points without combining goods.

The Sipoo logistics centre also serves as the regional terminal of Southern Finland. The majority of the outgoing traffic goes directly to the S Group’s Prisma stores, supermarkets, and service stations.

The share of direct deliveries from producers to retailers will drop to fifteen per cent. Large breweries, dairies, and bakeries will keep using direct delivery.

“We have 1,400 suppliers, with 1,200 active ones”, says Mikko Kymäläinen, the logistics manager of Inex Partners.

The inactive ones are seasonal suppliers, such as strawberry farmers, who only supply product during a certain season.

From the harbour to Sipoo in less than half an hour

The S Group’s logistics centre for utility goods has operated in Sipoo since 2013. The adjacent grocery logistics centre boasts triple the volume and much more advanced automatisation.

“The grocery side has fewer items but far larger volumes”, says Kymäläinen.

For utility goods, the S Group’s range covers 65,000 product items. Seasonal products, such as clothing collections and leisure equipment for all four seasons, grow the selection even further. Yet, “only” 35,000 pallet seats are reserved for storage of utility goods whereas the capacity for groceries is 90,000.

The sheer volume of groceries is perfectly illustrated by the fact that the logistics centre is visited by up to a thousand lorries and delivery vehicles each day, arriving and departing in all hours. The peak of the incoming traffic is between 1 PM and 3 PM, while the spikes in outgoing traffic occur during the evening hours beginning at 7 PM and 10 PM. The logistics centre operates around the clock every day of the week, except for the night between Saturday and Sunday.

Annually, a quarter of the flow of goods comes from the Vuosaari harbour, with 27,000 to 30,000 deliveries in total. Most are trailers, but there are also about a thousand containers. There are major seasonal differences in imports with, for example, the volumes of citrus fruit peaking during the winter months.

Compared to the location of the previous logistics centre in Kilo in Espoo, the trip from the harbour to Sipoo is smoother. The distance only differs by about four kilometres, but the difference in travel time is greater. Navigation services show the duration of the trip as 24 minutes.

“If you look at Vuosaari as the starting point, you had to drive all the way across Ring 1 to reach Kilo. In the case of inbound traffic, the fresh goods arrive in the mornings when traffic is heavy on the ring roads. Especially in terms of time, we’re now much closer”, says Kymäläinen.

Eighty per cent of the dry goods containers are handled by an automated process.

The driver does the loading and unloading

A quarter of the S Group’s retail grocery goods consists of foreign imports. These goods arrive practically entirely through Vuosaari. The logistics centre’s move to Sipoo in itself has not increased incoming traffic from the port. The volume has grown steadily with the sales increase boosted by discount campaigns.

– The products from domestic suppliers are in stock for a few days at most. The delivery rate is daily for the most part. For imports, an amount smaller than a container is not sensible. On the other hand, there may be several product items in the container.

According to Kymäläinen, one way the new logistics centre has affected the incoming freight is that disposable pallets have been abandoned. They are not as well suited for automated cargo handling as standard pallets.

– It’s impossible to profile the type of disposable pallets you get. If the purchase includes a hundred pallets, it will probably have ten different pallet sizes. That doesn’t suit our operations.

The logistics centre is shaped like a giant letter U. The goods arrive at the exterior walls and depart from the courtyard. Only the loading and unloading gates for frozen foods are on the outside wall, because they are not combined with other products. One arm of the U has dry products while the other, longer arm is reserved for fruit and vegetables, fresh produce, processed foods, and frozen foods. In the frozen foods storage, the temperature is kept at 26 degrees below zero.

Import deliveries are unloaded by Inex Partners staff, and domestic deliveries by the driver of the vehicle.

– It depends on the transportation agreements who is responsible for unloading. With imports, it’s usually us, says Kymäläinen.

The unloading gates for dry products are able to process 600 incoming pallets per hour. Manual transfers within the warehouse are minimised, and the pallets are moved onto a conveyor belt near the unloading gates.

Only one phase is manual work

Eighty per cent of the dry cargo items arriving at the logistics centre moves from unloading to loading in a fully automated process, with only a single manual phase. That is the removal of the protective film around the pallets.

– It’s not a good idea to automate that. If the blade cuts even one millimetre too deeply, there goes a can of juice.

A fifth of the dry goods that do not proceed fully automatically inside the logistics centre comprises various types of soft packaging. Some of these include paper towels and bags of dog food, which are collected using voice commands.

The automation begins as soon as the goods are ordered. The supplier sends an advance notice to the logistics centre when the order is completed. SOK has developed the free Node Flow portal for their customers. Using the portal only requires a computer and a printer for pallet tags. At the unloading gate, a barcode scanner compares the pallet data to the advance notice, and the pallet is sent to storage on a conveyor belt. The high-bay warehouse for dry goods has 55,000 pallet seats.

From there, the pallets are automatically lowered to the active location of the manual collection, or moved on conveyor belts to film removal and then to the unloading machine. The machine lifts each layer of packaging one crate or store shipment at a time onto the conveyor belt, with a tray belt running underneath. At the end of the upper conveyor belt, the packages fall neatly onto the trays on the lower belt. These are standard-sized platforms which make it easy to move the products.

Logistics Manager Mikko Kymäläinen says that the Christmas season has been making its presence felt in the logistics centre for daily consumer goods for a long time already. “Easter is an even bigger season because it is shorter.”

Layer pickers darting around in the tray warehouse

Products divided into trays end up in the tray warehouse, where a layer picker places them on one of the tray seats on the 20-metre-high shelves.

– The layer picker is basically a lift that moves both horizontally and vertically. It has two layers, meaning it can shelve and collect at the same time, Kymäläinen explains.

There are several of the astonishingly fast-moving layer pickers in the tray warehouse, as the tray seats for dry goods also number in over half a million. That’s enough for just over a day.

With each darting movement, a tray is moved onto the shelf and another from the shelf to the conveyor belt, and further towards one of the sixteen pallet machines. Of course, the other side of the tray warehouse contains a completely identical setup for dry goods, so there are actually 32 pallet robots as well. On the dry goods side, the total area consists of 80,000 floor squares.

– Mechanics aren’t incredible, it’s the whole, says Kymäläinen.

Seen from above, the palletizing resembles a three-dimensional Tetris game where store shipments are transferred from trays to trolleys or store pallets in layers. When one trolley contains much of the same product, its likely destination is a Prisma or another large store.

Finished pallets move through the wrapping machine to the buffer stock near the loading gates. The licence plate of the vehicle coming to retrieve the goods is scanned at the area gates, after which the driver is guided by an info screen to the correct loading dock, one out of approximately three hundred.

Upon the driver’s arrival, the trolleys and pallets for his load are waiting in the correct order. The driver scans the bar codes on the customer labels on the pallets, and pushes the pallets into the vehicle. After unloading incoming cargo, this is the second time a person participates in the process.