Case Study DM

The drugstore chain dm has set up a closed container returnable cycle using plastic bins from SSI SCHAEFER’s containers product line. The rugged bins are used for storage, order picking, and transport and open numerous advantages and potential savings for dm.

Shop delivery - One box for the entire flow of goods at dm

Case Study DM

Success Factor Plastic Containers

The drugstore chain dm has set up a closed container returnable cycle using plastic bins from SSI SCHAEFER’s containers product line. The rugged bins are used for storage, order picking, and transport and open numerous advantages and potential savings for dm. Regular orders of up to 60,000 containers per year mean that dm can continuously expand the system. SSI SCHAEFER has, over the course of several decades, proven to be a competent and reliable implementation partner for dm.

They are among the most proven organizational, storage, and transport aids – and they are the most durable and sustainable load carriers: plastic containers. Because of their features, they have been penetrating the market for decades - with application areas, concepts, and demand steadily increasing. The box manufacturing industry achieves average annual growth rates of four to five percent. There are numerous reasons for this growth: “A growing degree of automation in intralogistics, transport chain and cost optimization, as well as increasing environmental awareness are the main drivers for high market acceptance and demand,” explains Josef Kendl, Senior Sales Manager of Containers and Shelving Systems at SSI SCHAEFER, Wels. Increasing automation is raising the demands placed on load carriers. The plastic container continues its triumphant march ahead. Automated systems achieve higher pick rates, better availability, and lower error rates compared to cardboard boxes and obsolete non-compliant containers with plastic containers designed for industrial applications.

A study published by the Fraunhofer Institute for Building Physics in early 2018 on the carbon footprint of returnable plastic containers underlines these statements. Using the example of packaging systems for the transport of fruit and vegetables, it shows 60% lower greenhouse gas emissions for the returnable plastic containers than for disposable cardboard transport packaging. As early as the sixth cycle, returnable transport systems cause lower greenhouse gas emissions per cycle. In addition, they offer numerous advantages in terms of flexible scalability at the product, quality, and quantity levels, and regarding successive automation steps or optimized handling processes in operational processes and long-term investment security. A good reference for this strategy is dm drogerie markt GmbH, Wals. Founded in 1976, the company is the Austrian subsidiary of dm-drogerie markt GmbH & Co KG, which is now present in 13 European countries, mainly in Southeastern Europe, with more than 3,500 stores. The company is headquartered in Karlsruhe, Germany.

About the Project

Almost from the very beginning, for well over a quarter of a century, dm has relied on plastic bins for its own logistics processing. “I often come across containers with our old logo,” says Herbert Scheiblauer, Manager Transports & Warehouse Organization dm Austria. “The logo changed at the end of the 1990s.” In the 1990s, SSI SCHAEFER was already supplying the first plastic bins to dm. In 1989, the drugstore chain bundled its warehousing for the Austrian market in a distribution center in Enns, Upper Austria. By now, the center stores up to 14,000 cutting-edge drugstore items from the areas of health and beauty, baby, photo, and household, as well as parts of the supplementary product line such as pet food, small textiles, and seasonal articles. Today, it supplies all 389 Austrian dm branches as well as eight distribution centers in Central and Eastern Europe.

The sustained growth and dm’s expansion after the fall of the Iron Curtain led to continuous expansion and optimization of the processes. The first fundamental expansion of the logistics center took place in 1995. In 2009, a fully automated pallet and container high-bay warehouse was set up in preparation for future Logistics 4.0 requirements. After positive experiences in dm’s previous projects with the market leader for plastic bins and containers as well as its excellent references, SSI SCHAEFER was awarded the order for the steel construction of the plant with 57,400 container storage locations and 3,200 pallet storage locations.

To ensure continuous processes for order handling, SSI SCHAEFER integrated the controls of all components located in the warehouse into the logistics software WAMAS®. In addition to the basic equipment of the warehouse, dm ordered another 60,000 plastic containers from SSI SCHAEFER. “With the use of bins, we are now pursuing uniform standards from internal automation to distribution to the stores,” explains Herbert Scheiblauer. “Their extensive container product line, production flexibility, and punctual delivery of large quantities in addition to the quality of their plastic bins make SSI SCHAEFER a reliable partner at our side.”

SSI SCHAEFER’s range of storage, picking, and transport containers comprises more than 2,000 different types, designs, and sizes. The range extends from semi-open front storage bins, stackable transport bins, and shelving bins to foldable/collapsible boxes and Euro-sized containers to nestable storage and transport containers as well as bins and containers made of sheet steel. “The right container for every application and every area of use,” summarizes Josef Kendl, who also supports dm as project manager. “All made of recyclable materials.”

dm Austria opted for the FKE 6320 container type with the basic dimensions of 600 x 400 x 320 mm as the basis for internal order production and the returnable system. The rugged polypropylene container from the foldable/collapsible plastic box series has a capacity of 65 l and meets or exceeds the stringent requirements of the packaging regulations for returnable transport containers. SSI SCHAEFER has launched five different standard boxes in the FK series - three containers 600 x 400 mm in size with side heights of 285, 300, and 320 mm, as well as two containers 800 x 600 mm in size with side heights of 320 and 450 mm. Like all standard plastic containers from SSI SCHAEFER, they are exactly matched to the Euro pallet dimensions. The fixed, strong upper edge of the FKE 6320 guarantees high torsional strength and safe stacking – with or without a lid. The reinforced ribbed bottom is ideally suited for automated system handling. Strong enough for stable angular support in the automated miniload system (AMS), quiet and smooth on the container conveying system, compatible and flexible for latticed grip areas and accessory options such as 2-part convenient hinged lids, cover hoods, trolleys such as the Roll-Fix, and the roller plate offer short and long term added value for the user in a wide range of internal and external processes. The possible uses are endless and ensure a more efficient handling. Additionally, they support the reduction of the user’s CO2 footprint with every year of use!

Advantages that dm Austria intensively uses and consistently expands. “The order structures from the branches are becoming increasingly detailed,” emphasizes Herbert Scheiblauer. “At the same time, we are pursuing a separation strategy in warehousing and distribution. The returnable container system enables us to deliver a detailed order safely and damage free to our branches.” The FKE 6320s act as both source and target container for storage and picking at the Enns distribution center. Conveyor technology automatically guides the source container from the AMS to the respective workstations according to the goods-to-person principle. Up to 3,500 order positions per hour are removed there and picked directly into the target containers, which also serve as transport containers. Automatic container erectors upstream ensure that the employee receives ready-to-use containers. “With cartons, we would not only have to dispose of continuous purchasing costs and a lot of packaging waste in the branches,” explains the Transport & Warehouse Organizer. “In view of the high degree of order separation, we would also have considerable problems with palletizing according to branch requirements. The pallets loaded with cartons could hardly be stacked on top of each other without damaging the lowest sections due to a lack of stability. Additionally, distributing them in the back of a truck would waste an enormous amount of loading space.”

This is different with the plastic containers. The target boxes are filled to order, automatically removed from the picking stations via conveyor technology, and guided to consolidation stations where they are removed, stacked on pallets, and finally loaded for delivery to the branches. After storing the items, the branches fold up the transport containers to save space. Lastly, the containers are collected and transported back to the logistics center on schedule, closing the returnable system loop. “With the containers from the FK series, we can reduce our volume of empty containers returned by around 80%,” explains Josef Kendl. “Naturally, the use of returnable containers also supports the concept of sustainability.”

Against this background, dm Austria has, in recent decades, successfully rolled out the recycling system with returnable containers in regional companies throughout Southeastern Europe. By now, the Austrians are consolidating the demand for ten more of dm’s 13 European subsidiaries and placing a collective order with SSI SCHAEFER once a year. Since the beginning of the 2000s, the container market leader has been delivering between 40,000 and 60,000 storage and transport containers to dm Austria every year. In the meantime, a total of between 600,000 and 800,000 FKE 6320 containers are in circulation in the regional companies - around half of them in the coverage area of dm Austria alone. “The containers are coveted and are here and there removed from the returnable cycle and misappropriated,” admits Herbert Scheiblauer. “The constant demand, however, is primarily due to continuous growth, increased process automation, order peaks during the pre-Christmas season, and increasing requirements of our separation strategy in the supply chain. The containers themselves last for decades.” Just in time for the peak season, SSI SCHAEFER starts delivering the containers in October. “Absolutely on time – and extremely flexible when it comes to delivery dates, special requests from individual regional companies, and any follow-up orders,” says Herbert Scheiblauer, Manager of Transport and Warehouse Organization.

Nonetheless: plastic containers are not indestructible. But dm Austria has a solution for this. Damaged containers are removed from the cycle and sent to a non-profit association for repair. “A social project,” says Herbert Scheiblauer. “Their employees received special repair tools from SSI SCHAEFER and can restore a lot of boxes.” The rest of the containers goes, together with other scrapped and worn out containers that have been in service for decades, to a recycling plant where it is turned to raw material for new plastic containers. “All in all, the returnable containers form the basis for an efficient, sustainably effective complete system,” sums up Herbert Scheiblauer, dm drogerie markt GmbH. “It is fully scalable, offers many operational advantages and safe transport while generating significant savings. This is a success factor in our view. SSI SCHAEFER has proven to be a reliable partner in the long-standing business relationship with dm.”

Impressions on the partnership with DM

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