Waverley (the wines and spirits arm of Scottish Courage Limited) has an annual turnover of ?80 million per annum and a diverse customer base, ranging from large chains to Scottish and Newcastle pubs to individuals who buy wine direct. Waverley stocks over 2,000 distinct products and has its own wine bottling plant adjacent to the Felling warehouse. As well as traditional wines and spirits, the warehouse also supplies non-alcoholic drinks and newer lines such as alcopops.

The Old Approach

To service their customer base, Waverley had two main warehouses at Felling near Newcastle-upon-Tyne and Perth in Scotland. The Felling warehouse is 140,000 sq. ft. and operates about 50 forklift trucks and order pickers. Perth is the traditional home of Waverley and as such houses its IT and main management functions. There was no IT solution in place in the warehouse. The company was suffering all the usual problems associated with completely manual systems in a busy warehouse.

Motivation to Change

Waverley has been enjoying significant business growth. Its logistics operation was simply unable to cope with the increasing demands.

The company needed to change in order to facilitate growth through the existing infrastructure whilst improving customer service levels and reducing lead times.

With this in mind the key business objectives driving Waverley to introduce change were:

• An increase in operational efficiency and flexibility to meet the change in customer volumes and demands
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• Increased visibility, accuracy and control throughout all areas of the supply chain especially within the warehouses
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• The provision of real-time information facilitating effective management decisions
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• A reduction in lead times for customer orders

To achieve these objectives Waverley needed to overhaul their limited supply chain management systems with the introduction of a new warehouse management system alongside improved internal IT and operational system controls in conjunction with a major reorganisation of their distribution network.

Calidus-e software from OBS and Belgravium Radio Frequency Hardware were selected to control the Felling operation, due to their ease of use, flexible technology and high level of reliability and resilience. The initial implementation was in Felling but Jock Millican, Operations Director, decided to implement a parallel solution at the new Hemel Hempstead warehouse. The introduction of conveyor systems for bottle picking in both warehouses is currently under development.

Keith Marley (Regional Operations Manager) said "the new warehouse at Hemel Hempstead and our existing Felling operation will be the corner stones of the Waverley supply chain. They will ensure that our customers across the UK receive an even more responsive service than at present".

The Operation

Open Business Solutions and Belgravium provide 24-hour operation and support within the Felling warehouse, controlling all aspects of stock management with extensive use of radio technology and bar coding, providing real-time information and control. The system controls the management of bonded stock, from receipt, through replenishment and to despatch, the picking and despatch of full and split cases containing bottles of different products and provides perpetual inventory.

Success

The Felling operation had a phased implementation with the start of the Under Bond stock storage, picking and distribution in March through to the implementation of duty paid stock in April. Within two weeks of implementation throughput was 180% above Easter volumes for the prior year, with approximately 350,000 bottles picked and despatched per day.

Waverley has experienced benefits that include:

• Improved accuracy and control of inventory, labour and equipment
   
• A full audit of activities enabling the implementation of performance controls
   
• Provision of information to facilitate effective management decision making
   
• Meeting the operational needs of the warehouse with easy-to-use and flexible high technology devices
   
• Provision of a higher level of reliability and resilience than possible previously
   
• Inventory both under bond and duty paid is better managed with the system. The system and the operation are flexible enough to cope with different customer demand profiles and can handle short-term or long-term changes.