Project Overview

The Australian automotive aftermarket is a multi-billion dollar industry characterized by high SKU diversity and a dispersed customer base that demands rapid fulfillment. For OzParts Distribution, a leading player based in New South Wales, their primary Sydney facility had become a bottleneck for their national expansion. The challenge was to manage over 100,000 unique product lines—ranging from delicate sensors to heavy engine blocks—within a high-cost urban footprint. Runda Rack was commissioned to design and execute a comprehensive warehouse transformation, utilizing a 12-meter Very Narrow Aisle (VNA) racking system integrated with Pick-to-Light technology. This project represents a masterclass in “Cubic Optimization,” delivering a 95% cube utilization rate and achieving a near-perfect 99.9% order accuracy, providing OzParts with the scalable infrastructure needed to dominate the Australian automotive parts market.

The Client & Market Context

OzParts Distribution serves a network of thousands of independent mechanics, retail outlets, and specialized racing teams across Australia. Their “Next Day Delivery” guarantee is a core component of their brand promise, especially in the “Just-in-Time” environment of automotive repair. The Australian market is unique due to its vast geography; however, the majority of demand is concentrated in the major urban centers like Sydney and Melbourne.

The Sydney industrial real estate market is notoriously tight, with vacancy rates consistently below 1% in prime logistics corridors. For OzParts, this meant that moving to a larger facility was financially and logistically prohibitive. They had to find a way to significantly increase their storage capacity and picking throughput within their existing 85,000 square foot facility. Furthermore, the Australian labor market is characterized by high costs and a focus on occupational health and safety (OH&S), necessitating a system that maximized worker productivity while minimizing physical strain and the risk of injury.

The Challenge (Technical & Operational)

The Sydney Automotive Parts Center project involved a set of complex technical and operational challenges that required a multi-layered engineering approach.

First, “Extreme SKU Diversity vs. Uniform Workflow” was the primary logistical hurdle. Managing 100,000+ SKUs means dealing with a massive range of dimensions and weights. Traditional warehouse systems are usually optimized for either small parts (shelving) or large pallets (racking). OzParts needed a hybrid solution that could handle both within a unified picking flow. If a mechanic ordered a brake sensor (100g) and a cylinder head (40kg) together, the system had to ensure both could be picked and consolidated with maximum efficiency.

Second, “Vertical Precision at 12 Meters” was a significant structural engineering challenge. To maximize the facility’s vertical volume, we planned to build to a 12-meter clear height. At this height, even a 0.5% deviation in the floor level or a 1-millimeter misalignment in the rack uprights can lead to significant “Lean” at the top levels, making it impossible for specialized VNA trucks to operate safely. The racking had to be engineered with extreme torsional rigidity and installed with sub-millimeter precision.

Third, “Error-Free Picking at High Velocity” was an operational mandate. With a national delivery guarantee, a single mispicked item leads to a cascade of costs—reverse logistics, customer dissatisfaction, and lost mechanic hours. The high volume of small, visually similar parts (such as different types of O-rings or bolts) made manual picking highly error-prone. We needed a technological layer that guided the picker to the exact location without relying on SKU labels alone.

Finally, “Live Facility Integration and Zero-Downtime” was a project management constraint. OzParts could not shut down their operations for the three months required for the installation. The transformation had to be phased meticulously, with the new VNA zones being commissioned while the legacy systems were being dismantled, all while maintaining 24/7 fulfillment operations.

Engineering Solution

Runda Rack delivered an integrated engineering solution that combined high-precision steel structures with advanced digital picking systems.

12-Meter Precision VNA Racking System: We utilized our Nine-fold Upright system, manufactured from high-tensile Q345B steel, to reach the full 12-meter ceiling height. The Nine-fold profile provides 25% more torsional rigidity than standard C-profiles, ensuring the racks remain perfectly plumb under full load. We reduced the aisle widths to 1.6 meters, utilizing an inductive “Wire-Guidance System” in the floor. This allows the VNA trucks to travel at 12km/h within the aisles with automated steering, ensuring millimeter-perfect alignment with the high-level pallet positions.

Pick-to-Light (PTL) Small Parts Integration: On the ground and first levels of the VNA aisles, we integrated a high-density “Pick-to-Light” system for small components. Each picking bin is equipped with a digital display and an LED signal. When an order is triggered, the light at the correct bin illuminates, and the display indicates the required quantity. The picker confirms the pick by pressing a button, which instantly updates the Warehouse Management System (WMS). This system eliminates the need for paper pick-lists or handheld scanners for high-frequency small parts, significantly increasing picking speed.

Heavy-Duty Gravity Flow Trays for Engine Components: For medium-to-heavy items like alternators, starter motors, and cylinder heads, we engineered specialized “Gravity-Flow Steel Trays.” These trays utilize heavy-duty rollers and a “Braked-Roller” system to safely move heavy stock from the loading face to the picking face. This ensures that the oldest stock is always picked first (FIFO) and reduces the amount of heavy lifting required by the picking staff, as the items are presented at an ergonomic height.

Dynamic Load-Modeling and Seismic Anchorage: Given the extreme weights involved (up to 1,000kg per pallet at 12 meters height), we performed extensive structural modeling using Finite Element Analysis (FEA). We utilized “Oversized Baseplates” and “M24 High-Performance Chemical Anchors” to secure the system to the Sydney facility’s concrete slab. This anchorage system exceeds the local seismic requirements and provides a massive safety buffer against accidental impacts from material handling equipment.

Business Impact & ROI

The warehouse transformation project has delivered transformative results for OzParts Distribution, cementing their position as an industry leader.

Space and Capacity ROI: The 95% cube utilization rate allowed OzParts to increase their total pallet positions by 40% and their small-parts capacity by 60% within the same 85,000 square foot footprint. This effectively “Found” an additional 30,000 square feet of usable space, saving the client millions in potential relocation or expansion costs.

Accuracy and Fulfillment Velocity: Order accuracy reached a record 99.9%, a 5% improvement over their previous manual picking system. This improvement has virtually eliminated the costs of “Wrong-Part-Sent” returns and has significantly enhanced their reputation with mechanics nationwide. Order fulfillment speed (from click to dispatch) was reduced by 35%, allowing for a later “Cut-Off Time” for next-day delivery.

Operational Efficiency and Labor Savings: The Pick-to-Light and VNA integration allowed OzParts to handle a 40% increase in order volume with only a 10% increase in warehouse staff. The “Travel-to-Pick” ratio was significantly improved, as pickers spend less time walking and more time picking, reducing the overall energy consumption and maintenance costs of the forklift fleet.

Safety and Compliance: The project was completed with a perfect safety record. The ergonomic improvements and the automated VNA steering have led to a 50% reduction in reportable OH&S incidents, lowering insurance premiums and improving employee retention in the competitive Sydney logistics market.

Sustainability & Future Proofing

Sustainability was integrated through “Material Longevity” and “Process Optimization.” The high-tensile steel used in the Runda Rack system ensures an operational life of 25+ years, and the Nine-fold profile is 100% recyclable at the end of its lifecycle. The efficiency gains achieved through the Pick-to-Light system have reduced the warehouse’s paper consumption by 100%, as the facility has transitioned to a fully “Paperless Picking” environment.

The Runda Rack system is designed to be “Autonomous-Ready.” The wire-guided VNA aisles are perfectly compatible with the next generation of fully autonomous VNA robots (AGVs), allowing OzParts to transition to a “Lights-Out” automated warehouse in the future without replacing their core racking infrastructure.

Furthermore, the system is “Agile and Reconfigurable.” As the automotive market shifts toward Electric Vehicles (EVs), which have different parts profiles (fewer engine blocks, more batteries and electronic modules), the racking heights and the Pick-to-Light bin configurations can be adjusted with minimal downtime. This inherent flexibility ensures that the Sydney Automotive Parts Center will remain a world-class, high-efficiency asset for OzParts Distribution for decades to come.