The BASF property in Ludwigshafen, Germany covers 7 square kilometers and houses about 2,000 buildings, making it one of the world’s largest complexes in the chemical industry. When something breaks down in one of the operations housed here, a quick reaction is required. Part of the chemical plant operates 24×7, so when a process breaks down for a long time, it costs BASF a great deal of money.
The same is true for downtime that results from regular maintenance on cucurbits, vats, and other equipment. “To keep downtime as short as possible, we deliver rush orders for spare parts within two hours and for spare parts for planned jobs within 24 hours,” says Walter Schleder, director of the warehouse and distribution center project at BASF.
Quick availability of spare parts
That’s why the chemical company consolidated the various logistics centers for technical goods to supply its headquarters in Ludwigshafen and created a new warehouse and distribution center in nearly Frankenthal. The high-bay racks offer 17,000 square meters of space – as much as three soccer fields – and store large machine components and systems along with small parts like screws and gaskets. BASF contracts Würfel Spedition GmbH and approximately 40 employees to run the warehouse and to package and transport goods.
BASF invested about 2.5 million Euro in the new warehouse and distribution center. From now on, the center will deliver some 320,000 items each year to the Ludwigshafen location. Ten BASF employees inspect all goods for quality. The goods are stowed in the 8-meter high bays with up to 19 levels only after they have passed the quality inspection. A standby team works nights and weekends to ensure that anyone in the plant who places an order receives the required goods within two hours.
IT-supported control of assigning warehouse space
BASF IT Services makes sure that an integrated information system stores all information on the goods from goods receipt, quality inspection, storage, and good issue. This BASF subsidiary enhanced the existing SAP software for warehouse management, tailored it to meet the special needs of the parent company, and created the required infrastructure. It also handles operations and maintenance.
All data about the ordering parties, goods, and transportation are combined and compared in the existing SAP solution. The integrated solution is built upon the foundation of materials management software in SAP R/3. The warehouse management portion of the logistics execution system from SAP was implemented as part of the comprehensive logistics solution. “We used the existing functionalities in warehouse management to control the assignment of warehouse space with categorization and rules, according to the requirements of the customer,” says Michael Schehl, director of finance, asset management, and global reporting solutions at BASF IT Services.
For example, SAP LES now assigns space near an exit to frequently used items. Once an order has been posted, employees at the warehouse and distribution center store all the required information – the results of the quality inspection, the storage location, and the transportation data – in the solution. Experts at BASF IT Services also created a special interface to the scheduling application of Würfel Spedition GmbH. SAP R/3 and the external application now exchange all required data seamlessly for optimal control of transportation.
“That works in both directions,” explains Schehl. “Almost all users of the SAP solution can see the current status of deliveries immediately.” If a production site at the BASF plant orders specific goods, the manufacturer delivers the goods to Frankenthal. The various items are prepared there for delivery and transported to the end customers in the Ludwigshafen plant.
“By bundling goods receipt, quality inspection, picking, and goods issue, we have many fewer trucks on the roads of the plant compared to the decentralized warehouse and delivery units and operated previously. And we have also reduced traffic and costs,” says Schleder.
The new warehouse and distribution center for technical goods isn’t the only logistics facility at the chemical company’s Ludwigshafen location to be modernized with the help of BASF IT Services and SAP software. The distribution center for packaged chemicals dedicated in 2003 has 126,000 pallet locations and is the largest facility of its type in Europe and was built with the know-how of both partners and other companies.
Order and delivery in one day
Large quantities of packaged chemicals from anywhere in the Ludwigshafen plant are collected at the distribution center and assigned to a transport. Palette hubs in the forwarding area are used for goods receipt and issue. A stacking system uses mobile data terminals to ensure that goods are ready for shipment at the right time and in the right place. Loading control was developed in-house by BSAF and organizes loading the trucks. Some of the project-specific development later became part of the standard SAP LES.
Although 8,000 different products and about 40,000 items from 200 production sites all come together in the distribution center, most deliveries today are fulfilled on the same day. The new center is the heart of the delivery system at BASF Ludwigshafen and handles almost a million palettes each year.