Lennox Revamps Regional Distribution Center in Down Economy

At the close of 2008 and in the midst of economic uncertainly, Lennox International, Inc. (“Lennox”) chose McGee Storage & Handling, Inc. (“McGee”) as their vendor of choice to help them analyze, consolidate and reorganize their southeast warehouse and distribution operations into a single Atlanta Regional Distribution Center (RDC). The new 250,000 sf. RDC is located in McDonough, GA.

Lennox (www.lennox.com), through its subsidiaries, is a global leader in the heating, air conditioning, and refrigeration markets. The company is built on a legacy of innovative firsts, from the introduction of the riveted-steel furnace in 1895 to some of the most efficient air conditioners available today. Lennox continues to push the standard in home comfort forward with a lineup of more than 60 leading-edge products and a network of more than 6,000 full-service dealers.

The Mission

The objective for the southeast RDC was to consolidate separate facilities and operations into a single regional hub, designed to provide cost-effective storage and distribution of a vast number of large units and small parts, representing most every size and dimension. The design and layout of the facility also required consideration for product inventory turns, reflecting industry demand and seasonal trends.

The Challenge

There were two, primary challenges for this project. The first was the ability to meet an aggressive, "fast-track" schedule that would allow the RDC to go operational in less than two months. McGee provided full time Project Management resources to keep all phases of the project moving forward, including: initial analysis and design of the solution; manufacturer recommendations and sourcing alternatives; engineered drawings and county permitting assistance. The holiday season presented further scheduling challenges, yet McGee provided full-time crews to meet the schedule.

The second challenge was to design and implement a solution that would stay within the capital budget. McGee was able to source and supply reliable, after-market material into selected areas of the project to provide a more cost-effective, integrated solution.

The Solution

The Storage and Material Handling Solution provided by McGee encompasses three distinct areas:
  1. Steel Shelving for Small Parts/Small Case Pick - Steel Shelving was ideal for small parts storage. McGee was able to source and install a large lot of Used Shelving to reduce the capital investment required in this area. The product was trucked directly from the source to the location, erected, and then prepared for immediate use. In anticipation of the condition of some after-market materials upon delivery, McGee deployed a cleaning crew to wipe down the shelving system for immediate use by Lennox. The design of the shelving system allows 100% selectively to a large number of small part SKUs. Extra height (10 ft.) was also incorporated to allow for either buffer storage up high, or the additional of a catwalk system as future needs dictate. Insert
  2. Pallet Storage for Larger Case Pick - Selective Racking, designed with 10’6” aisles to save space, was paired with standard Crown, three-wheel, sit-down fork trucks. Wire-decked shelves were installed up to six ft. (6’) from the floor in much of this area to accommodate larger case pick items designated for floor picking. The pallet rack storage system is adaptable to provide for changes in volume, weight or size of the palletized products. Insert and Proper guarding, Guard Rail, Post protection and End-of-aisle Guards were added to help assure years of damage free performance. Insert
  3. Floor Storage - The wide variety of product sizes handled by Lennox mandated the need for designated, segmented Floor Storage spaces. Extensive consulting was required to effectively allocate, organize and identify these spaces. Alternative proposals were designed by McGee for consideration before a final plan was chosen. McGee provided both paint floor striping services and ceiling hung, aisle signs to assure efficient management of these floor inventory storage areas. Insert

The Results

This tailored solution, provided by McGee, met all foreseen requirements of Lennox for small case and large pallet pick storage, 100% selectivity of SKU’s, system adaptability, structural protection and overall cost effectiveness. A successful, on-time implementation allowed Lennox to open their new RDC on time and begin storing, shipping and receiving operations in January 2009.

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