One of Australia's largest beverage distributors, Casella Family Brands, has made some unprecedented efficiency gains at their distribution centres.
Distributor of the Yellowtail wine label, Casella, supplies around 27 per cent of Australia's bottled table wine, holds a record for the fastest growing imported wine in US market history, and distributes more than 12.5 million cases of wine to 50 countries around the world each year.
Following such a sustained period of rapid growth, Casella recognised it needed new technology that could improve visibility of inventory across its two distribution centres (DCs), which could offer the required degree of scalability to improve product availability and drive future growth.
After an 18 month search for the right candidate, Casella settled on a partnership with logistics specialists Manhattan Associates, which has seen implementation of the SCALE (Supply Chain Architected for Logistics Execution) software at Casella's distribution centres.
Casella Family Brands Distribution Manager Sam McLeod said the new warehousing software system has made some significant changes to their business, streamlining their old supply chain methods and increasing efficiency by 22 per cent.
"Prior to the implementation of Manhattan's SCALE software we had something that wasn't far off a paper based system," McLeod said.
"We could not scan or log anything leaving the warehouse aside from which we wrote down and then logged back in through our previous system.
"For us it's been a big change because now we scan every single outgoing product via unique Licence Plate Numbers (LPNs) which gives us a great degree of traceability that we certainly didn't have before."
With traceability being the number one concern in the wine distribution game, McLeod said the new system ensures minimum disruption in the event of a recall thanks to enhanced product monitoring.
"We could run a product, say a Shiraz 1.5L retail product, which would be about 30,000 to 40,000 cases in one hit. Under our previous system if we had a recall based around one hour's worth of product, we would still have to recall all 40,000 cases to get the required batch, because there was no way of determining what products were processed in a given time period," McLeod said.
"Now, in theory, we could narrow that range down to 500-600 cases.
The old Casella system required manual marking of pallets on order sheets, an extensive checking process of 40 sea-containers worth of product each day. However, now orders are picked, placed in staging areas, and then scanned back out to the containers.
"That's made an awfully big difference to us; this is hours each week that we're saving because we don't have to go back and double check."
McLeod said the new system is anticipated to save Casella three per cent on wages in the coming financial year, a significant share in an operation of that size.
The other major benefit Casella has seen is an increase in the utilisation of warehouse space by 22 per cent.
"Being able to increase our warehousing capacity means that, as we have the fastest bottling line in the Southern Hemisphere, our warehouse is our limiting factor," McLeod said.
"By increasing our usage of the floor space by 22 per cent, we can run to 22 per cent greater efficiency over the course of the year, and that's a big saving on revenue, which is fantastic."
McLeod said the company previously had to employ up to five people allocating stock from different regions of the warehouse to be picked and placed in the loading bays, a task which can now be co-ordinated from a single computer.
"Before we had five people across 500 SKUs, trying to pick independently of one another, but now our system allows us to use up one row before we look at another one, then we can use that up and move on," he said.
"As you can imagine it's a very complex equation for individuals to handle, sitting at a computer with data entry, but for scale at the click of a button we can allocate those associated rows, and that's where the 22 per cent comes in.
"Simply put, thanks to the availability improvements we've achieved with Manhattan's technology, our coveted Yellow Tail brand is seen on more dining tables, on more store shelves, and in more bars, pubs, clubs, hotels and restaurants around the world with every passing week and month."