Dexion delivers custom storage solution for DHL Hub in Hong Kong

Dexion won the tender to supply a complete storage solution for the new Interlink MegaHub created by DHL Supply Chain in Hong Kong.

DHL Supply Chain (DHL) is a world leading global logistics provider specialising in warehousing and distribution with operations in 220 locations and employing over 285,000 staff globally. DHL’s Hong Kong operations were spread out across five different warehouses at various locations, requiring technicians and managers to travel regularly between the sites to coordinate work.

According to DHL’s Senior Manager for Supply Chain Solutions, Tony Leung, there was a need to consolidate the five warehouses into one MegaHub warehouse in order to improve efficiencies in space as well as operational management.

Reasons for the consolidation also included Hong Kong’s notoriously high rentals and major traffic slowing down the transportation of goods between locations, contributing to inefficient operations. DHL’s Facility and Asset Manager – Operations Excellence, Kenneth Lau explains that land in Hong Kong is very expensive and very little land is dedicated to warehousing, even though the city services a large consumer and retail industry.

Spotting an opportunity, DHL’s senior management team decided to build a new warehouse that would consolidate all of DHL’s clients into one convenient location, which would also allow them to pool all their resources, manpower and equipment to create one giant MegaHub.

Conveniently positioned in the centre of Hong Kong with all the logistical advantages of a centralised location, well serviced by trains, ships, planes and trucks, the new Interlink MegaHub site also offered the added benefit of being a LEED GOLD and KHBEAM accredited building, designed to meet Hong Kong’s highest sustainability and safety standards, according to DHL’s Senior Director Operations Excellence – North Asia, Drew Wright. The Interlink MegaHub is located in a 23-floor, 900,000 square feet warehousing site on Hong Kong’s Tsing Yi Island.

To address the racking requirements of the new Interlink MegaHub, DHL invited five suppliers in 2011 to tender – the logistics specialist sought a complete storage solutions partner with expert experience to team up with for the duration of the project.

Leading storage and materials handling specialist, Dexion won the tender to fit out the Interlink MegaHub.

The construction and fitout of the Interlink MegaHub was an enormous undertaking. The 23-storey building is the largest of its kind in Hong Kong, with a 15-storey ramp for trucks and eight floors above only accessible using lifts. DHL now occupies eight of these floors, which includes DHL’s offices and ramp and lift access.

Leung said the project was particularly complex because of the logistics involved in migrating thirty eight of DHL’s different clients across to the new site simultaneously.

Dexion rose to the challenge by adapting their workforce and plans to address challenges along the way. While the original project plan was for a period of six month, this timeline was shortened to a two-month period.

Lau added that they had one week to implement a new mezzanine section and an additional two weeks to install a conveyor system. Wright was very impressed with the way Dexion adapted to the new deadlines.

Walter Lai, Sales Manager of Dexion Asia Limited in Hong Kong proposed the solution and coordinated the fitout for the DHL MegaHub project. Dexion’s solution accounted for thirty eight customers across eight floors, each with different requirements ranging from storage of tiny components through to large drive-in pallet racking solutions.

While most of the solutions were relatively standardised, each customer was consulted individually to establish the right solution for their particular storage requirements.

For instance, the 11th floor was designed for a major semiconductor company that needed high-density small parts storage to house millions of tiny electronic components. To accommodate the storage requirement of around 8,000 SKUs, Dexion built a rack supported raised storage area, which provided 1826 picking locations across two levels. The raised storage area provided uninterrupted floor space on both levels. Free space on the ground floor allowed easy movement and unlimited flexibility for setting up a processing area, while the upper level provided high density picking modules, making the most of the available space.

A motorised conveyor system was also installed to transfer goods between the raised storage area and the processing area on the ground floor, requiring Dexion to work around the building’s fire system. Due to the height of the building, each floor has been fitted with three large 3x3 metre columns with a fire shutter between the columns for fire protection. In some instances, the conveyor system traverses through the paths of some of the fire shutter roller doors; automatic gates have been installed on the conveyor system that open once the fire shutter is activated to close that zone.

According to Dexion’s General Manager Systems Solutions, Stuart Macnab, the iconic Hong Kong Interlink MegaHub is a fantastic showcase for both DHL and Dexion.

Wright concludes that every potential customer that walks in and looks at the Interlink MegaHub will see the DHL brand together with Dexion storage solutions, which is great for both companies.