Availability is key to success
June 1st 2009

Delegates from the UK, Germany and the Benelux countries recently took a close look at the cost efficient and highly flexible automated central warehouse concept currently being implemented by WITRON for Alliance Boots in Nottingham

Alliance Boots is an international pharmacy-led health and beauty group with two core businesses, pharmaceutical wholesale and retail pharmacy. Working in partnership with manufacturers and pharmacists, the group delivers a range of products and services that help millions of customers and patients look and feel their best. Formed on 31 July 2006, Alliance Boots is privately owned and employs around 105,000 people. It has a wholesale and distribution network serving almost 130,000 pharmacies, hospitals and health centres via almost 370 depots in 15 countries and a network of approximately 3,100 outlets in nine countries, of which around 2,800 have pharmacies.

Around 45 delegates from companies from the UK, Germany and the Benelux countries took a close look at the cost efficient and highly flexible automated central warehouse concept currently being implemented by WITRON for Alliance Boots in Nottingham. One of the largest SCM projects in Europe recently started its second phase with the opening of the second DPS (Dynamic Picking System) section to store and pick more and more goods automatically.

"Our mission and purpose in the Boots supply chain is to be the best pharmacy-led retail health and beauty supply chain, and to help our stores look and feel better than ever thought possible," said Gavin Chappell, Supply Chain Director at Boots. He also pointed out that the Stores Service Centre (SSC) in Nottingham, UK is the key to enabling Alliance Boots to achieve their future supply chain mission and purpose.

"The WITRON concept is very much aligned with this, which is really helpful and important for us." Due to customer needs and building constraints, the project was divided into two phases. "The Witron module strategy allows for flexibility in project planning and allows for modules to be built, tested and brought online alongside an ongoing operation. At Boots we have had the flexibility to meet the needs of the business and when necessary move work previously allocated to one phase of the project into another," explained WITRON Project Manager Josef Bauriedl.

"We are expecting the completion of the SSC to produce impressive cost efficiency and sustainable optimisation through the introduction of store-friendly deliveries," added Gavin Chappell. "We want our staff to do customer-focused activities for 80 per cent of their time instead of non-customer focused stock counting and replenishment.

The store-friendly delivery features of the Witron concept contribute significantly to that." SSC supplies 2,600 UK Boots stores About 2,600 Boots stores will in future be supplied centrally from the SSC in Nottingham. The facility can hold up to 30,000 SKUs and has the capacity to process up to 2.8 million picks, 5,200 inbound pallets, 98,000 outbound totes and 4,640 outbound roller containers across a 20 hour operation. In order to achieve this, Witron have implemented the following modular system solutions into an impressive integrated system: The Dynamic Picking System (DPS) as a tote picking system, the Car Picking System (CPS) as a roll container picking system, the Order Consolidation Buffer (OCB) for ready picked totes and a High Bay Warehouse (HBW) for pallet storage.

"Everything we do must be cost effective and optimised, because our customers want to earn money with our solutions," said Jack Kuypers, WITRON's Branch Manager for Northwest Europe. He also pointed out that DPS has been implemented 35 times in companies throughout the world – with no single installation the same as another. "As with all WITRON warehousing and picking systems, DPS is based on modular standard components which are combined with individually customised functionalities to offer maximum flexibility." Even during the busiest time of the year, the second phase of the SSC began exactly according to the agreed time schedule in December 2008 with the delivery of the socalled Order Consolidation Buffer (OCB).

Since then the CPS began operation in January this year, followed by the second DPS phase in March 2009. At present, approximately half of Boots retail sales stock is despatched from the SSC. Final acceptance of the complete project is scheduled for autumn 2009.

One of the most challenging tasks during the whole project was the installation of very modern supply chain technology into existing warehouse buildings. As a brownfield solution it has been important to strike a balance between what is technically optimal and what is possible at the Boots site without affecting existing operations. "Witron delivered their promise" says Boots Supply Chain Director, Gavin Chappell. "We can even say that the results we expected, in this difficult business case, have been surpassed." The delegates at WITRON's Logistics Day in Nottingham were mainly interested in seeing what can be done in relation to their own storage and picking processes.

After a short presentation both from WITRON and Boots a guided tour through the SSC during operational hours gave the participants the chance to see the system in live operation.

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