Supply Chain Planning

A Wave of Smart Warehousing is Coming!

This white paper introduces Cello VWS, a system designed to optimize strategies for warehouse operation, and its features and functions along with its use case.

In today’s e-Business environment, distribution center (DC) operation is becoming ever more complex with DCs and warehouses getting larger to handle a variety of items. In this trend, how you operate your distribution centers or warehouses can significantly impact operating cost. Thus, the importance of having an effective operation strategy for putaway, replenishment and slotting as well as layout design is a lot greater than ever.

In this white paper, we’re going to look into Cello VWS (Virtual Warehouse System), a solution that enables you to create your warehouse layout using the current design or Cello CAD1) and to gain visibility into receiving, shipping and inventory via chart, 3D and VR by combining data on legacy WMS or Cello WMS. With the analytics and simulation of Cello VWS, you can also develop operation guidelines optimized to your warehouse. Cello VWS aims to help you figure out warehouse operational issues and increase efficiency by analyzing order/work data which has been stored on your WMS but rarely used in practice.  

Cello VWS Functions & Features

Detailed Indicators for Greater Operational Efficiency

Cello VMS provides not just general indicators such as inventory accuracy, on-time receiving and on-time shipping but also detailed indicators including item-location pick frequency match rate2), putaway accuracy rate3), dead space ratio4), high-rack pick rate5), replenishment efficiency6), receiving pallet-receiving location match rate7). With these indicators, you can easily figure out the operational efficiency level of your warehouse and compare alternatives to one another.

Virtual Simulations for Strategy Execution

How you implement your warehouse strategies has a great impact on your operational efficiencies. Cello VWS provides a putaway/picking simulation engine with which you can run simulations of how items are coming in and going out according to user-defined operation plans. On Cello VWS, you can also identify what operational issues you have and how you can resolve them, using a series of analytics tools and detailed indicators.

Picker Routing Analysis Using Actual Distance Algorithm

One of the major elements that cause warehouse operating costs is travel distance, most of which is accounted for by a picker’s travel distance. Cello VWS analyzes how efficiently an order picker travels by using Cello Distance Engine Algorithm to calculate the actual distance traveled.

Distance Calculation Using Cello Distance Engine

Cello VWS: Use Case

With consent of our customer, we conducted a trial test of Cello VWS on two large distribution centers in Europe. The result showed that Cello VWS helped reduce order pickers’ travel distance by 6.5 percent and 14.0 percent respectively. In Picture 6 and Picture 7 below, red-colored spots mean they have a high pick frequency while yellow-colored and blue-colored spots represent they have medium and low pick frequency. As you can see in Picture 6, many of the red-colored areas used to be located in the back (on the left). With Cello VWS, we did an ABC analysis and revised its warehouse strategy. As a result, the red-colored spots have been replaced by blue-colored ones. In the Picture 7, too, you can see that many of the red-colored sections have now been removed from the back area to be located closer to the outbound area and higher than the other sections.

Cello VWS was also greatly useful in developing an alternative layout design of Distribution Center A which had been suffering due to a lack of putaway space. It turned out that Distribution Center A didn’t have enough space for flat stacking compared to the number of items handled, and this subsequently affected its putaway process.

To resolve the issue, we looked at how many more locations would be needed.
According to our analysis, splitting the current space to add more locations wasn’t really effective as it was expected to result in storage space reduction if you accommodate aisle space. Instead, we found from our simulations that securing additional space for flat stacking was a better feasible solution.

Alternative Layout for Distribution Center A


To find out more about Cello VMS of Samsung SDS, visit and download the white paper.




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