Traceability & Compliance for Wholefoods Health Foods

WMS Warehouse Management Software Eliminates Wastage Reducing OpEx

Founded in 1983, Wholefoods Wholesale Ltd.is Ireland’s largest and longest established distributor of natural foods and healthcare products. The company serves over 1,200 customers nationally from its Dublin, Ireland headquarters. About 80% of the business is with health food stores followed by pharmacies, alternative health therapy practitioners and delicatessens.

The company manages over 3,000 retail accounts across Ireland spanning more than 8,000 product lines across branded and generic products including vitamins and supplements, herbal remedies, licensed medicines, bodycare and haircare.

The Business:

• Ireland’s leading Natural Foods & Healthcare Product Distributor
• Supporting over 1,200 Customers & 3,000 Retail Accounts
• Over 8,000 Product Lines with 6,000+ SKUs
• Regulated by the Irish Medicines Board & Licenced by the Dept. of Agriculture for Food Distribution

Warehouse Management Technology Supporting Food Distribution

Wholefoods Wholesale’s Dublin site employs over 75 staff managing and operating a 20,000 sq. ft twin level facility. Stock variety is wide ranging, with around 6,000 SKUs.

The warehouse includes restricted and quarantine areas to comply with regulatory requirements, as some products, including a number of prescription items, are subject to stringent Irish Medicines Board (IMB) regulations. Wholefoods Wholesale has a medicines distribution licence from the IMB and must comply with its stringent Good Distribution Practice (GDP).

The company is also licensed by the Department of Health and the Irish Organic Growers Association/Department of Agriculture for its food distribution business and has to comply with these additional licence requirements.
 

WMS Software: Optimising Food Distribution – Situation

Wholefoods Wholesale’s operations and administration functions were relying on a dual server-based IT infrastructure setup. This supported 26 desktop PCs and 27 Radio Data Terminal units used by forklift and warehouse staff all connected through a wireless infrastructure.

Business Growth was posing serious challenges to the company’s administration and systems, in particular, its stock and warehouse control functions. So, it set about seeking a new software solution able to cope with current and future demands. There was a requirement that any new technology would increase inventory accuracy and customer service levels, minimise time and paperwork overheads and deliver improved stock management across multiple locations.

Full Traceability: More importantly, the business needed to comply with strict food traceability laws and offer full traceability for the supplements side of the business. The system had to provide the company with a competitive advantage by increasing accuracy and efficiency and by serving its customers better.

Existing ERP: The management team assessed whether its ERP system could deliver the required warehousing functionality. It became apparent that this was not realistic. They also reviewed available ERP and accounting solutions, but it was soon clear that the required high level functionality was not available, even from leading ERP solution providers.

When it was unable to find a one-stop solution, the team revisited its business operations and requirements. While it had some issues with the ERP system, most of the key requirements revolved around effective stock management and traceability issues.

Functionality & Needs: Some of the functionality that the company needed was straightforward enough, such as tracking goods in and out, warehouse location recording and generating picklists. Other needs were more complex. For example, a key business requirement is traceability of best before dates and batch numbers through the pick faces. This was time-consuming and tedious to record manually, and few systems were available able to address this requirement efficiently.

Legal Obligation: There was a need to maintain complete traceability for all licensed and prescription items to satisfy the Irish Medicines Board. Additionally, advanced stock and productivity reporting was required.

WMS Software – Improvements

Wholefoods Wholesale reviewed numerous systems including the in-house developed In-DEX WMS Warehouse Management Software suite from Principal Logistics Technologies. Areas it looked at included, not only how In-DEX WMS could take warehouse and stock control to a new level but, how it might integrate with existing systems as well as support some other bespoke key requirements.

Picking Errors Eliminated: A constant problem for warehouse staff is that many stock items look alike. There might be a subtly different size or contents. Also consider that the number of capsules in two bottles will look the same from a stock picker’s perspective. This results in considerable potential for picking errors. Familiarity is actually the danger, because people tend to see what they expect to see – in the usual place. In-DEX WMS seamlessly manages these issues as it directs the user – as opposed to the user going to where they think the product is – and, as such, has eliminated such problems.

Order Picking & Management Simplified: In-DEX WMS takes care of all stock movement from the sales order processing system, or when a purchase order is raised. Order picking is simplified through the lists presented by the handheld units. Stock rotation rules and implementation of best before date policies are integrated and automatically observed, with any required reports available at a click.

Best Before Date Management: In-DEX WMS prevents a previous situation in receipting short shelf-life products at Goods In. The system sets the minimum acceptable number of days against each product record. The operator keys in the BBD date and, in real time, In-DEX WMS looks up the product record and calculates if the operator entered date is acceptable – an operator alert is issued if it is short.
 
 

“Familiarity is actually the danger, because you tend to see what you expect to see in the usual place. In-DEX simply manages all of the issues as it directs the user as opposed to the user going to where they think the product is and, as such, has eliminated such problems.”

Kylie Burke, IS Director, Wholefoods Wholesale Ltd.
 
 

 
 
Errors Eradicated: In-DEX WMS eliminated errors in customer orders and simplified staff working practices as they now simply scan the barcode to identify the customer order, SKU and quantity required.

Management of Mixed Products: When a single pallet is delivered with multiple SKU’s and varying best before dates In-DEX WMS allows operators to break pallets down and record all varying metrics (like SKU’s, BBDs, quantities etc.) and then either directs the operator to locate these products or rebuild the pallet and locate the entire mixed pallet, recording its location. The system also locates the (unbroken) mixed pallet into a single pallet location so that it can be checked at a less busy period.

Stock Returns Reduced: Delivery accuracy improvements have resulted in fewer stock returns. The van sales staff are much happier because there are fewer issues at their end, in dealing directly with customers. And, the company has
reduced OpEx because wastage has mostly been eliminated since the principal causes were through overlooked stock becoming out-of-date, or packaging damage from unnecessary handling/transport as a result of errors.

Real-time Data Exchange: At the backend, Wholefoods Wholesale will often have different promotions but In-DEX WMS easily copes with bonuses, price breaks and time-limited promotions. It also exchanges data transparently in real-time with the ERP system for purchase orders, stock replenishment, Proof of Delivery and invoicing.

Traceability for compliance purposes is fully managed by In-DEX WMS, from supplier despatch or warehouse arrival to the customer Proof of Delivery docket there is complete visibility of every item going through as well as up the supply chain and back down to customers’ doors – and to the shelf.

Following delivery, Wholefoods Wholesale estimated that it was probably using no more than around 60% of In-DEX WMS’s capabilities. There was a wide range of management reporting functionality that was just starting to be looked at like pick-rates-per-hour. It also looked at ways in which it could contribute to decisions on space requirements, trends and changes, and possible layout variations for improved efficiency.

In many respects traceability was considered one of the most important benefits. The proportion of products covered by either the Irish Medicines Board or Food Safety Authority of Ireland regulations was significant and a smart, auditable system was needed to ensure strict compliance.

Results:

• Traceability for compliance fully managed from supplier despatch, warehouse arrival to customer Proof of Delivery
• Reduced OpEx: Elimination of wastage less out-of-date stock or damaged packaging
• Order picking errors eliminated: Complete visibility of all items in & up the supply chain and back down to customers’ doors –
  & to the shelf
• Increased delivery accuracy resulting in reduced stock returns
• Mixed Product Management: Multiple SKUs & varying Best Before dates fully managed
• Data exchanged data transparently in real-time with the existing ERP system
• Future Expansion Assured: Only 60% of In-DEX WMS capability is in use

Future-proofed technology: In-DEX WMS supports full traceability for any number of future health food and supplements products added. Adherence in operating to consumer product distribution best practice standards in future product range planning is also assured.
 
 

 
 
“The Wholefoods Wholesale warehouse staff became very comfortable quickly with the hand-held devices and it was immediately  noticeable that accuracy and pick rates had increased. They embraced the new technology immediately, which had been a major concern initially.”

Joe O’Shea, Director, Principal Logistics Technologies