United Facilities is a third-party logistics (3PL) provider that offers a range of public and contract warehousing, fulfillment, packaging and logistics services to clients in the consumer goods and automotive sectors. In the past 60 years, United Facilities has expanded from a 125,000 square-foot building to more than 5 million square feet, with operations in 11 cities in the U.S.
When one of its customer’s legacy warehousing systems was becoming too expensive to maintain, United Facilities turned to JDA Software. The company evaluated a number of providers, ultimately implementing JDA Warehouse Management and JDA Warehouse Labor Management, from JDA Software’s Distribution-Centric Supply Chain suite, via the JDA Cloud.
"It’s our goal to serve our customers with the absolute highest level of service and uptime, at the lowest costs possible. We chose JDA because we felt like they had the depth in their organization to be able to provide the level of support that we would need," said Jeremy Altorfer, IT director, United Facilities. "We didn’t have the capability to host our own cloud. All of our previous systems were hosted on-site, and we wanted a provider that was experienced with cloud hosting. We’ve found a good partner in JDA."
New Processes Yield Substantial Results
Leveraging the JDA solutions, United Facilities has introduced a number of new processes over the years that have reduced costs and increased productivity within its operations. "We had started to see an increase in fractured ordering, where we ship to customers who place the same orders multiple times a day," said Altorfer. "We worked with JDA to develop a new allocation strategy that enables us to pick these orders more efficiently. If the guys on the forklift can visit a bay one time to pull product for all five orders that we’re going to receive throughout the day, then that’s going to be more efficient than having to visit each of those bays five times as part of the normal allocation process."
Today, the logistics and warehouse management company leverages this parallel allocation and picking strategy to process thousands of complex orders per year, generating time savings of 40 minutes per order. This approach to innovation has been replicated in other areas of the 3PL’s business, such as packaging. A few years ago, one of its customers for which it handles a large amount of packaging approached United Facilities with an ambitious goal: to realize 5 percent savings in the current year, 7 percent the next, and continue to build on the savings with each successive year.
"It seemed difficult to promise those types of savings in an environment where the labor market was getting more expensive, and the number of shipments for packaging was increasing," said Altorfer. "We ended up completely redesigning our rate structure using JDA’s solution, and as a result, we delivered a 12 percent savings to the customer in the first year."
Increasing Visibility & Collaboration
United Facilities has also been able to increase inventory visibility for its customers through the creation of an online portal. The portal retrieves data directly out of the JDA solution database, enabling authenticated users to access real-time updates on any order at any given time. By giving its transportation network real-time visibility into its shipments, United Facilities has eliminated a lot of email and phone call communications. It has also improved trailer availability during high volume periods to 90 percent or higher.
"The online portal gives us one place to pull good, solid information that’s indisputable. This allows us to be able to nail down exactly when trailers are unloaded and exactly when trailers are loaded," said Altorfer. "As a result, we’ve been able to reduce detention charges by as much as 60 percent."
United Facilities also uses JDA Warehouse Labor Management, which has enabled the company to define and document standard performance expectations and then measure, track and report the performance of employees, departments and facilities. The third-party logistics company leverages the solution to decrease labor costs, increase productivity and improve visibility into current workload and down time. As a result, the 3PL company has optimized its labor performance, reducing overtime costs by 21 percent.
Over the course of its relationship with JDA, United Facilities has collaborated with JDA Services and other companies using these solutions to identify new ways of driving innovation in its business. "When we decide that we want to change our processes, we start asking questions. The JDA team will say, ‘Have you tried this? Have you set it up this way?’ That’s helped us be more flexible with how we’re using the system," said Altorfer. "We’ve also been able to network with other companies using JDA’s solutions. Having the flexibility to innovate has been a key driver to our success."
The story behind United Facilities's growth has roots that run deep. From operating a public warehouse to now operating as a nationwide third-party-logistics company, the evolution of United Facilities has been profound over the past several decades years.
Early Stages of United Facilities
In 1953, the early founders of United Facilities bought at a five-story, 125,000 square foot building in central Illinois with the intention of creating a manufacturing business of their own. While planning this new endeavor, they began warehousing other companies' products. So it was by accident that United Facilities had entered in the public warehousing business.
With backgrounds in design and manufacturing, they saw opportunities in what is now known as the logistics industry. Instead of just storing products, United Facilities decided to integrate inventory coming from various points to ship customer orders.
In 1959, this type of innovative thinking led to one of the first multiyear warehouse contracts in the nation, which established United Facilities as a pioneer in the outsource logistics industry. The company's success has not been by accident, but rather through innovation and superior customer service.
Due to the excellent service provided in Peoria, one customer requested that the brothers open an out-of-state distribution center in 1967. This made United Facilities one of the first existing multi-state warehouse service providers in the industry.
Growth Driven By Technology & Innovation
Computer-based networking systems were seen as an operational, competitive advantage as early as 1984. A few years after that, a systems designer was hired full-time to develop a WMS System, which, with several upgrades, is still used today.
The 1990s brought about many new initiatives to further enhance customer service. Product sampling services were provided to customers, as well as in-store display setups, packaging, kitting, light assembly, and contract manufacturing services. This also included programming and technical writing expertise, computer-aided design, layout and other engineering services and internet fulfillment.
United Facilities has expanded its packaging department which has become an area of expertise for the logistics company. They have focused a large amount of energy in streamlining the packaging processes and also using cutting edge technologies to save money and increase productivity, and drive incremental sales growth.
United Facilities Today
Today, a new generation of Altorfers is active in managing the logistics company. Through an ever-expanding variety of services, the company has grown to over 5 million square feet with operations in eleven cities.
Expansion and innovation is what drives the current generation of United Facilities. Emphasis on technology, continuous improvements and community presence are key aspects of how United Facilities continues to evolve in the world supply chain arena. New tracking and inventory control programs have been introduced in the last three years which have markedly helped boost productivity and reduce costs.