Happy hour

Di­a­geo’s re­cent in­no­va­tions get your favourite drinks on the shelves more ef­fi­ciently

Australian Transport News - - Contents - WORDS RICKY FRENCH

Di­a­geo’s re­cent in­no­va­tions get your favourite drinks on the shelves more ef­f­ciently

T here’s a bit of a Willy Wonka feel when you en­ter the new Di­a­geo ware­house in Hunt­ing­wood, Sydney. Ex­cept rather than ev­er­last­ing gob­stop­pers and scrum­didil yum­tious chocoate bars, the treats are more adult in their con­coc­tion. John­nie Walker, Bund­aberg Rum, Baileys and Cap­tain Mor­gan among the rest of Di­a­geo’s for­mi­da­ble al­co­holic brands.

Ma­chines whirl and ro­tate and fizz and pop. Coloured liq­uid is squirted into empty bot­tles and swept down a pro­duc­tion line shoul­der to shoul­der. Au­to­matic arms grip bot­tles and at­tach tops and stick­ers. Bot­tles and cans are shunted to­gether, boxed and pal­letised in a hyp­notic blur. Nearly a million litres are pro­duced here every year.

As Di­a­geo’s sup­ply chain man­ager Gra­ham Wig­glesworth walks ATN through the fill­ing lines, work­ers in lab coats and hair­nets load empty bot­tles and en­gi­neers mon­i­tor screens. In the space of a minute, 1500 cans and 600 bot­tles will be filled, pro­cessed and wrapped on pal­lets, ready for the next phase of the op­er­a­tion.

As en­chant­ing as the pro­duc­tion line is, it’s what hap­pens next that we’re re­ally here to see.

CON­SOL­I­DAT­ING PRO­DUC­TION

While the Hunt­ing­wood site has been around for 25 years, the re­cent $21.5 million ex­pan­sion is barely two years old. Vaughan Con­struc­tion han­dled the job, which took 20 months. The ex­pan­sion added an au­to­mated ware­house and dis­tri­bu­tion area to the foot­print.

The new ware­house has 26,000 pal­let spa­ces but takes up a rel­a­tively mod­est 5000 square me­tres thanks to the

dou­ble deep, 30m high-bay rack­ing sup­plied by Colby. It’s part of Di­a­geo’s goal to re­duce its car­bon emis­sions by half, mostly by elim­i­nat­ing trans­port be­tween Hunt­ing­wood and its for­mer ware­house in Erskine Park.

In the two years the ware­house has been in op­er­a­tion, Wig­glesworth says they’ve done just that. But it’s not just the en­vi­ron­ment that wins. Fewer kilo­me­tres clocked up by trucks means huge sav­ings for the busi­ness and sub­stan­tially greater ef­fi­cien­cies across the net­work.

“A big part of that was tak­ing trucks off the road,” Wig­glesworth says. “We get no re­bates or in­cen­tives other than be­ing a good cor­po­rate cit­i­zen, and we’re very proud of that.”

The ben­e­fits of get­ting the Sydney op­er­a­tions all un­der one roof ex­tend to mit­i­gat­ing Sydney’s no­to­ri­ous traf­fic and speed­ing up the over­all de­liv­ery of prod­uct through the sup­ply chain.

“The more you touch a prod­uct, the more chance there is of dam­age, and the more chance there is of slow­ing the process down. The less you touch and move around the prod­uct the bet­ter.”

Pre­vi­ously Di­a­geo used a third party for its ware­hous­ing at Erskine Park. Today the change, both in re­spon­si­bil­ity of stor­age and in the tech­nol­ogy used, couldn’t be starker.

AU­TO­MATED CRANES TAKE OVER

Once the bot­tling and pal­letis­ing is com­plete, the pal­lets are as­signed shelf po­si­tion au­to­mat­i­cally through a man­age­ment sys­tem de­liv­ered by Sydney com­pany Pa­per­less Ware­hous­ing.

“It’s our ma­jor sys­tem when it comes to stock con­trol,” Wig­glesworth says.

From the pro­duc­tion line, fork­lifts carry the pal­lets to one of six De­matic RapidS­tore 1224 stor­age re­trieval ma­chines. The ma­chines are essen­tially cranes that con­vey the pal­lets along the high-bay aisles and store them in their des­ig­nated spot. The stor­age spots are worked out au­to­mat­i­cally by the man­age­ment sys­tem based on FIFO and age of stock.

Fork­lift drivers con­sult a screen on their fork­lift that tells them which re­trieval ma­chine to take the pal­let to.

“The cranes are pick­ing FIFO on a batch level, so as we put batches in the cranes are au­to­mat­i­cally choos­ing the old­est stock.”

The cranes are smart in other ways, too, us­ing a de­frag sys­tem that means they are con­tin­u­ally shift ing stock to have it put in the op­ti­mal po­si­tion.

“When the cranes aren’t busy, they move fast-mov­ing stock for­ward to en­sure that when they are busy they don’t have to travel as far to get it,” Wig­glesworth ex­plains. “We also spread the risk across the six cranes, so if at any point we were to lose a crane we would have stock avail­able across the other ones.”

Af­ter pick­ing up a pal­let from the pal­letiser, the driver will scan the pal­let and see on his screen which crane to take the pal­let to. The driver then scans af­ter it’s been dropped to the crane, at which point the crane takes over.

Wig­glesworth says that while us­ing reg­u­lar fork­lifts is work­ing well, they’re in­ves­ti­gat­ing the pos­si­bil­ity of in­tro­duc­ing au­to­mated guided ve­hi­cles (AGVs) in the fu­ture. One of the many ad­van­tages of us­ing au­to­mated ma­chines is the ware­house can run 24 hours a day, seven days a week. They also work in the dark, which saves money on elec­tric­ity.

“The cranes know to place stock in dif­fer­ent lo­ca­tions de­pend­ing on tem­per­a­ture,” he says.

“We have some prod­ucts, such as Baileys, that are tem­per­a­ture sen­si­tive. So the cranes obey a set of rules.”

Wig­glesworth adds that the chal­lenge lies in the end-point de­liv­ery to cus­tomers.

“What makes it dif­fi­cult is try­ing to spread the work across the day, be­cause cus­tomers usu­ally want their stock at the same time.”

GO­ING WITH THE FLOW

“A lot of peo­ple don’t re­alise this is all hap­pen­ing in Sydney,” Wig­glesworth says. “They as­sume the prod­uct is all im­ported. It’s not.”

Eighty per cent of what Di­a­geo sends out to cus­tomers – in­clud­ing Coles, Wool­worths and Aus­tralian Liquor Mar­keters (ALM) – is bot­tled or canned at the Hunt­ing­wood fa­cil­ity. Around 20 per cent comes in fully im­ported.

A busy day will see up to 70 B-dou­bles ar­rive and pick up stock, mostly us­ing Toll, Wool­worths Pri­mary Freight and VISY Lo­gis­tics.

“In this world it’s all about hit­ting times­lots,” Wig­glesworth says. “You need to know how you’re go­ing to use your labour to de­liver your ser­vices. We have to hit cus­tomers’ times­lots.

“If some­thing goes wrong along the sup­ply chain there’s a domino ef­fect.”

From the out­feed pal­lets are wrapped, and from the wrap­pers they go straight onto trucks. There is a large un­der­cover area for stor­age of im­ported stock await­ing trans­port to cus­tomers, and all trucks fol­low a one-way flow

when en­ter­ing and leav­ing the fa­cil­ity. What’s no­tice­able is that the en­tire op­er­a­tion takes up only a small amount of space. It’s a very short run from the pro­duc­tion line to ware­house to wrap­pers to trucks. Di­a­geo ap­pears to be mim­ick­ing its over­all fru­gal­ness of trans­port even within the con­fines of the ware­house.

It’s a fine ex­am­ple of trim­ming the fat, mak­ing use of space and us­ing only what is needed.

RE­SULTS THAT SPEAK VOL­UMES

There were three keys goals to achieve by ex­tend­ing the foot­print of the Hunt­ing­wood fa­cil­ity, and Wig­glesworth says Di­a­geo has achieved them all.

The first was to im­prove cus­tomer ser­vice. Wig­glesworth says sur­veys show that’s been achieved. The sec­ond was to stream­line the sup­ply chain. The en­tire op­er­a­tion is faster and more ef­fi­cient by tak­ing trucks off the road, re­duc­ing the han­dling of the stock, cut­ting out the 3PL, and hav­ing the pro­duc­tion, ware­hous­ing and dis­tri­bu­tion all hap­pen­ing un­der the one roof.

“It stream­lines ev­ery­thing. You’ve got to move prod­uct through your sup­ply chain fast. That way you re­duce touch points and there’s less chance of dam­age,” he says.

The third was to save money, and Wig­glesworth says he’s seen that hap­pen.

“The ware­house has de­liv­ered all of the num­bers we wanted it to. We made a $21.5m in­vest­ment, and that in­vest­ment is ba­si­cally un­der­writ­ing all the things that were in the cap­i­tal ex­pen­di­ture. We needed to get faster, more ag­ile, more re­spon­sive, and we’ve done all that. That’s what I’m proud of.” The im­prove­ments aren’t stop­ping, ei­ther. “We’re mak­ing a $7 million in­vest­ment in a new filler right here. We con­tinue to invest in the busi­ness,” Wig­glesworth says.

‘Right here’ means the bot­tling plant where the magic keeps hap­pen­ing. Rum ar­rives from Bund­aberg in tankers and gets drained, bot­tled, sealed, la­belled, boxed, wrapped, stored and sent out in a stag­ger­ing dis­play of pre­cise au­to­ma­tion.

It’s all watched over from an up­stairs of­fice with a view to a colour­ful won­der­land. Wig­glesworth gazes over the fa­cil­ity with pride and grins.

“Be­ing a kid, you watch pro­grams about how things get made. Well, here it’s the same. It’s big boys’ toys.”

Top: Di­a­geo’s Sydney op­er­a­tion at Hunt­ing­wood

Above: The new au­to­mated stor­age lay­out with the De­matic RapidS­tore SRMs

Op­po­site: The hyp­notic blur of bot­tling; Di­a­geo Aus­tralia sup­ply chain man­ager Gra­ham Wig­glesworth

Top: The Di­a­geo bot­tling fa­cil­ity that runs along­side the new ware­house at Hunt­ing­wood Above: Load­ing at Di­a­geo’s Sydney ware­house

Op­po­site: Di­a­geo work­ers on the bot­tling line; Work­ing in the dark. Au­to­mated stor­age cour­tesy of De­matic’s RapidS­tore SRMs

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