Musgrave Retail Partners Ireland is driving forward three key pillars in its supply chain operations which will ensure it integrates positively into its retailers’ businesses and adjusts to the company’s acquisition of 24 Superquinn stores.
The largest division of the €4.8 billion-revenue Musgrave Group will be opening up more warehousing space in Dublin in July 2015 to help accommodate the expanding volumes.
That these extra assets have already been integrated into the logistics process has pressed the need to become more effective and efficient with highly-engaged staff, the balance of which something Supply Chain Director, Luke Hanlon, emphasises as crucial moving forwards.
He said: “We are working to strike an optimal balance by developing an end to end supply chain which is both effective for our customers and efficient. In order to do both we need engaged colleagues.”
Musgrave Retail Partners Ireland (MRPI) caters for 686 stores across Ireland comprised of larger SuperValu stores and supermarkets alongside the smaller convenience-style brand of Centra, respectively competing with the likes of Tesco and Spar.
Now branded as SuperValu, the Superquinn stores have taken the number of SKUs covered by MRPI to 15,000, making the extra 57,000 square feet of chilled warehousing space at its Fonthill warehouse in Dublin a very welcome addition when it becomes operational next summer.
This will ease pressure on the existing 78,000 square feet in Fonthill and joins an ambient storage facility in Kilcock, Co. Kildare and an all-temperature site in Cork which serves the south of the country.
“Bringing across that volume has involved squeezing it into our existing space to date and the extension will help greatly in managing this efficiently,” Hanlon added.
“We have had to move stores around from depot to depot to smooth out volumes but we are in a healthy position and looking forward to the new space. It has forced us to become leaner and smarter, which we will continue to push for.”
Central to continuous improvement efforts is increasing effectiveness, which MRPI has achieved in a number of areas over recent times.
Voice technology is ensuring warehouse pickers are in the right location picking the right volumes of product for particular stores, replacing outdated paper systems which led to greater incidences of human error.
Hanlon said: “We pick around 107 million cases a year and have reduced the number of mistakes from 20 in every 1,000 to just two. Taking out the paper has also allowed us to become hands free, which speeds up the process.”
Paper is also being removed on the transport side of the supply chain. Advanced shipping notifications remove the need for paper checks on incoming shipments and Paragon route planning software is automating the most effective route plans without the need to study and plot on paper.
Many of MRPI’s transport initiatives result in increasing efficiency of operations on top of driving effectiveness.
For instance, the use of telematics allows drivers to improve their efficiency and is helping to increase fuel economy. The fleet is now running at more than nine miles per gallon, helping bring down the annual seven million litres of fuel used.
Also reducing fuel usage is the doubling up of routes, with around 40-50 percent of inbound volume delivered on return legs from store deliveries. This is boosted by the integration of double decks to the 520 company-owned trailers to maximise the use of space.
The 220 tractor units being leased are run on a biodiesel blend and Hanlon is looking to other renewable fuels such as compressed natural gas.
Looking at the supply chain from end to end is a focus which will enable MRPI to become both more efficient and effective at the same time, in that shelf gaps will be cut and touch points from production to delivery will be reduced.
Recently the team led a programme looking into the root cause of 14,000 shelf gaps in retailers’ stores. “This has allowed us to move beyond a silo approach into making changes from start to finish that ultimately make it easier for retailers to get products on the shelf.”
“We have reduced the lead time to retailer from 48 to 40 hours, which is in effect gives them an extra day of sales so they can put in a more accurate and aligned order. We have also started Sunday deliveries on produce as weekends were found to contain gaps in the fresh ranges.”
“I am also asking what other sectors like pharmaceuticals and manufacturing do to make their operations the best and leanest. Some of Ireland’s best supply chains in terms of operational excellence are found in the medical sector and we can learn from that.”
The benefits to be reaped from enhanced effectiveness and efficiency will only be maximised by an engaged employee base, the third ‘E’ which Hanlon sees as vital to MRPI becoming truly integrated into its retailers and a key part of their value propositions.
“It is common to think within the four walls of the warehouse sometimes, and because our business is mostly made up of independent retailers under our brands, it is important to consider us as a key part of their individual business,” he said.
“There was a need to get our 1,300 warehouse workers out of the warehouse to visit and see what life is like for retailers. When things go well what does this mean, and when things go badly what does that mean for the retailer?”
MRPI is also using huddles – interactive meetings between line managers and employees using visual management techniques to help gauge opinion and field questions and ideas. Internal studies have shown an eight percent increase in employee engagement over the past year and this year’s employee survey is currently being conducted.
Finding the balance between efficiency and effectiveness while keeping employees fully invested in the division’s strategy is crucial if Musgrave Retail Partners Ireland is to continue the successful management of the country’s largest grocery supply chain.
And with the continual streamlining and evolution of processes being adopted as part of an end to end vision of the supply chain, the new warehouse space to be opened at Fonthill will provide great scope to become even bigger and better.