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Flow 13 million product cases a year through a new distribution hub for United Biscuits? Up and running in just 11 weeks? Now you might think that's plain crackers ...
United Biscuits - UB - is a leading European manufacturer and marketer of biscuits and snacks. Consistently first or second in all its key markets, UB makes and markets some of the most famous and well known biscuit and snack brands - including McVitie's, McCoy's, KP and Jacob's - that have been enjoyed by generations across the years. Headquartered inHayes, Middlesex and with revenues of over £1.3 billion, the company employs over 11,000 people with 9,000 in the UK.
Critical to the business is UB's Distribution Services - based in Ashby-de-la-Zouch in Leicestershire - tasked with ensuring that the right products go to the right customers in theright place at the right time, every time. Two of the Ashby facilities are key to keeping UB's supply chain running smoothly and act as the primary consolidation hubs for its UK and international operations: the Midlands Distribution Centre (MDC) and its buffer, the Ashby Distribution Centre (ADC).
With an operation of such size and scope - and following a series of acquisitions and operational re-organisations - UB needed an industrial-strength and enterprise-wide warehouse management system (WMS) capable of handling the flex of everyday demand while simultaneously offering an IT platform able to cope with anticipated business growth. UB's team turned to supply chain integration specialists Central Systems & Automation and its market leading WMS solution, Autostore.Â
Top of the list of objectives for the Ashby-de-la-Zouch operation was to integrate the Jacob's, McVitie's and KP product ranges in a single facility for the UK business, in support of the existing MDC operation at Ashby. The 310,000 pallets of Jacob's products being distributed each year were delivered separately from other UB products, meaning inconvenience for customers and additional costs and complications for the business.
The opening of the ADC would solve this. The stock ordering and customer service systems for both Jacob's and UB products had to be aligned together, customers had to be informed, the stock distribution systems at both the MDC and the ADC had to be revised and new distribution plans prepared to achieve combined deliveries in the same vehicle.
Ambitious consolidation plans ...
Underpinning this significant integration and consolidation exercise was an ambitious real estate and business systems 'Big Bang' that would see UB's distribution services take a step change in efficiency and capability - and do it very quickly. The key was the creation of the ADC to complement the MDC: a greenfield warehousing site, the ADC would need to be re-designed, staffed, managed and brought online in under three months without disruption to the business.
Not only would the ADC operate as a buffer store to the MDC, handling nearly 5.5 million cases on 106,000 pallets annually, it would also work in its own right performing a selected number of customer deliveries for major UK multiples (3.7 million cases annually); as well as handling UB's export business (4.3 million cases). This gave UB's ADC team, headed by Implementation Manager Willie Krupa, the chance to design a state-of-the-art facility unfettered by legacy systems or the usual physical limitations of inherited brownfield operations. Not only that, the new ADC would be 95 per cent brand new: physical systems, structure, IT and WMS backbone and people.
Importantly, Krupa's team wanted to introduce a flexible 3PL model into UB's supply chain operations, deploying wireless broadband networking, wire guidance for vehicles and very narrow aisles for denser storage that would make the available space work that much harder.
Says Krupa: "We had deliberately set the bar high in terms of what we wanted the ADC to achieve - and to deliver against expectation, it was clear we would need a very productive and powerful WMS infrastructure to pull it all together. I had been aware of Autostore for some time and knew that it was capable of handling big operations and doing it well. We were all keen to create something really special with the ADC and provide the wider business with the model solution to warehouse management - so we went the Autostore route with a single-site, single-client WMS server licence and full yard management functionality."
Tailored approach to warehouse management ...
With the ADC still only existing in theory, the Central Systems team began the bespoke tailoring of Autostore to handle UB's brief. UB's gap analysis between their requirement and the standard Autostore solution threw up some developments that needed to be made - but not many. The ADC would use vertical racking instead of the more normal double-deep horizontal arrangement, working with 3m apertures instead of 1.8m ones. With transport overheads being the single most expensive variable cost, a tailored vehicle utilisation and load management capability within Autostore was a critical requirement - needing to be optimised for all customer load movements to provide a maximum density of product per shipment.
Krupa's team took a very hands-on approach to ensuring Autostore was geared correctly for the ADC's needs: "During the development and test period, two of us acted as 'super-users' and our sole aim was to pressure test the system and iron out the wrinkles before the 'Big Bang' switch on. Working with the Central Systems team, we completed the fine-tuning of Autostore inside three months. It's a very robust solution with excellent field support and the 'super-user' approach paid dividends in getting differences nailed fast. Our own testing tells us that Autostore is as tough and as flexible as we'll foreseeably need - and that gives us tremendous confidence."
Fast set-up ...
Setting up the ADC itself was achieved in record time. From when UB obtained the lease on the premises, it was just four weeks before the first delivery was received and the site was fully operational by week 11. This constituted a huge amount of work in a short timeframe, including removing 104 racking frames and 6,700 racking beams, re-positioning a further 8,700 beams, applying 12,000 racking labels - plus installing, testing and commissioning Autostore.
The WMS isn't the only new system at the ADC. Narrower aisles between rows of stock allow denser stock storage on floors that have been ground perfectly level by laser. To get pallets on and off the shelves there are Very Narrow Aisle (VNA) trucks that raise the driver and forks up to 9m in the air for the precision collection and placement of stock. The vehicles are guided accurately down the aisles by a wire guidance system to avoid collisions and all picking and put-away movements are managed by Autostore via easy-to-use truck-mounted radio data terminals (RDTs) running over a broadband wireless LAN.
While the ADC was opened to help the business absorb Jacob's distribution operation, it does not contain Jacob's products. The flexibility of Autostore means that the ADC can distribute around 13 million cases a year, primarily for export and some own label customers, allowing it to act simultaneously as a holding point for products imported from other regions. This has freed up capacity at MDC, making it easier to get Jacob's and other UB products onto the same vehicles running the same deliveries - giving UB a more flexible distribution capability with plenty of scope for further growth.
Feeling the benefit ...
So what's the bottom line for UB? Autostore has enabled ADC's seamless integration with the Jacob's supply chain and improved accuracy throughout the supply chain. Not least of the benefits is using it to identify additional operational areas and processes for optimisation. Productivity at the ADC has already improved by four per cent overall and Krupa adds that there is clearly scope for more.
Concludes Krupa: "We're always looking to drive down our operating costs by improving the way we use the WMS and its associated control and reporting systems. Several optimisation projects are currently underway, driven by the view and grip of the business that Autostore gives us. We're running in-depth performance reporting and using really handy graphical overlays to spot potential bottlenecks. Most important is the "what if ..." scenario simulations we can now run - this is really helpful when it comes to planning operational changes. We can see the effect those changes have on the business before we make them. And that's invaluable."