Dairy Crest's centralized UK distribution center continues to set the standard for chilled dairy

The automated system includes a monorail conveyer, conventional conveyors and several elevators for automated storing and order picking. An additional cheese maturation store holds 35,000 pallets.

Anyone in the UK knows the name Dairy Crest. Its brands are family favorites, found in millions of fridges throughout the country. The butter and spreads unit produces a range of popular brands. Dairy Crest's cheeses can be found in Britain's supermarket delis and aisles everywhere. It is also one of the UK's largest purchasers of fresh milk, buying approximately 2.4 billion liters every year.

Since 1992 Dairy Crest has been in a steady expansion mode. A joint venture with Yoplait established Yoplait Dairy Crest (YDC), responsible for producing and marketing chilled yogurts, desserts, cottage cheese and ice cream.

Through a series of acquisitions, Dairy Crest has become the UK's leading chilled dairy foods company, and one of the ten largest food companies in Britain.

This rapid growth brought the necessity to consolidate the company's distribution configuration, which up until several years ago was not centralized-shipments were made to retailers from no less than ten different production facilities throughout England. Customers were placing one order, but in effect getting multiple separate deliveries coming from different locations.

Additionally, a change in the late 1990's to the retail supply chain in the UK jump-started the change in Dairy Crest's distribution set up. Customers moved to what is known as "day-one for day-two" distribution, where they order their products every day for next-day delivery to their DC. That's the way the whole industry in the chilled dairy and chilled food market works within the UK now. A lot of Dairy Crest's products, historically, were on longer lead times.

Other food manufacturers have had to deal with this change in distribution, but not on the same scale as Dairy Crest's 50 million-case annual throughput. This was the trigger point for Dairy Crest to build a central distribution center, capable of efficiently handling higher volumes, higher pallet make-up complexity and shorter lead times.

"Our primary function is to distribute our company's products to UK retailers for sale and for foodservice industries", says Andrew Watson, Distribution Director for Dairy Crest. "We have over ten production facilities in the UK, and we have four factories in France under the Yoplait banner providing products. It all comes down to this one national DC in Nuneaton, about 100 miles northwest of London, and then we consolidate orders."

Clients will order typically about mid-day, Dairy Crest will pick their orders through the night and then deliver from midnight onwards.

"Also, we designed our DC to house cheddar in maturation," continues Watson. "We receive cheese in block form from our production facilities, and we hold it in controlled store temperature for up to 12 months. Simple operation, but very intense in terms of storage-a 35,000 pallet store for this maturation process."

Dairy Crest Selected Dematic Corp. (formally Siemens Logistics & Assembly Systems, Inc.) to design and implement the central DC. Dairy Crest initially had a very cohesive idea of what capabilities they wanted. After a thorough analysis of their needs, Dematic came back with a broader material handling solution that encompassed all aspects of their DC operation, including improving automation in their picking process and implementing a state-of-the-art WMS package. That solution delineated what the internal part of the building would look like. Dairy Crest then found a contractor to build, in effect, a 240,000 sq. ft. shell to go around it. The building was constructed first, and Dematic proceeded to build-out the material handling equipment (MHE) systems to go inside it.

The Dematic design called for integrating a monorail system to carry pallets through all phases of the DC. It was hung directly from the building structure at a high level. The monorail can carry in 200 pallets an hour, and bring out 230 pallets an hour, interlinking all production areas of the DC, transporting pallets between storage and picking, and between picking and shipping.

The monorail is the heart of the pallet transport system. It is a single track, Dematic DSB Monorail with 28 suspended pallet carriers, and approximately 500 feet long, fed by conveyors from the different areas. Pallets come onto, and are taken away from the monorail using conventional pallet conveyor systems. There are five lifts for moving pallets between levels in the building as well. The inbound product-laden pallets go into storage. Then, when required, they are taken to the picking area. From the picking hall, once complete, the customer's order-specific pallets go back on the monorail and are taken to the shipping area.

"Dematic designed a total site-wide solution for Dairy Crest," says David Jefferys, who headed up the project for Dematic's UK offices. "Before designs were finalized, we developed computer simulated models for Dairy Crest of our proposed system undergoing accelerated production levels."

The huge, state-of-the-art, cheese maturation store is structured with free-style, high-rise racking more than 90 ft high-17 vertical pallet positions-on 50,000 square feet of floor space. Because the cheese is stored for a year or more, the pallets are slow moving. This seven-aisle facility is served by two storage and retrieval cranes, which can transfer between aisles via two mobile transfer bridges running across the front of the racking. The cheese can be retrieved and transferred to an output conveyor spur via a shuttle car, ready for dispatch to the cutting and packaging facility.

"The system runs smoothly," continues Jeffreys. "Incoming pallets are transferred from trailers to infeeds on automated receiving conveyors via ride-on powered pallet trucks. The pallet identity is verified against information held in the warehouse management system (WMS)."

Siemens also implemented a WMS application tailored to the requirements of Dairy Crest. Product coming in is tracked with EAN 128 pallet labels. This is a European spec bar code, which contains the ASN (Advanced Shipment Notice). As soon as each pallet is received and scanned, it associates with a prior electronic-received purchase order. It can then be put straight into the conveyor system where it is automatically booked in.

The WMS also integrates with Dairy Crest's sales order processing IT platform, creating a seamless path from the customer through to the dispatch of picked goods. Orders can be amended up to the last minute, accommodating any changes in customer requirements. With picking, the WMS includes the ability to continually assess future order requirements, and assign and replenish picking locations. Yard management is also encompassed by the WMS.

Order fulfillment is up to 99.9%. Stock turnaround decreased from 24 hours to 14 minutes. Accurate fulfillment within tight deadlines is consistently achieved, despite growing demands. Dairy Crest now regularly dispatches products within 6 hours of receiving an order.

For more information on Dematic's logistics solutions, contact John Clark, Manager of Communication; 616/913-7287; email john.p.clark@dematic.com; www.dematic.us. Dematic Corp., headquartered in Grand Rapids, Mich., is one of the world's leading suppliers of logistics automation systems and solutions.