CCA Australia Operations & Logistics Platform

Transcription

1 CCA Australia Operations & Logistics Platform Bruce Herbert Director, Operations & Logistics key messages 1. CCA operates a large and increasingly complex Supply Chain 2. We have a flexible Manufacturing Capital Strategy aimed at building capacity and reducing operating costs 3. We are part way through a major Logistics Capital investment stage which is already reaping benefits. 2 1

2 A lot happens between forecast and cash -8 weeks Forecast volume 458 SKUs -4 weeks Plan Production 41 prod lines -3 weeks Produce 550,000 p c per day Ship 60 semi trailers Store 8 primary WHs -1 day Take order 15,000 calls per day -12 hours Consolidate loads 450 loads per day Now Pick orders 13,000 per day +6 hours Load, cross dock deliver 70 locations +1 day Deliver order & invoice 835 trucks <30 days Receive payment $9.5 M NSR per day 3 Delivery to C&L customers Trucks / Drivers Deliveries Physical cases C&L m 55m Equipment Delivery 40 70K 70K QUIRKS Delivery 30 40K 40K VENDING K 5m COLD CHAIN K 500K NEVERFAIL m 8m TOTAL m 70m 4 2

3 Multiple production sites produce a wide range of beverage SKUs 15 Plants 41 Production Lines CSD Water Hotfill Juice Postmix & Cordials 397 SKUs 1.8 Billion litres produced Neverfail Carbonated Beverages Juice Peats Ridge Springs 5 Comprehensive distribution reaching 90,000 customers 8 Primary warehouses 70 satellite warehouses and cross docks 835 trucks 90,000 customers 150,000 HOD customers 7.6 billion 8oz serves delivered this year 6 3

4 Volume & complexity increasing but customer service levels & manufacturing productivity also improving million unit cases ordered 245 SKUs 97.3% physical cases delivered in full 124 cases per man hour million unit cases ordered (+9%) 458 SKUs (+87%) 99.8% physical cases delivered in full 133 cases per man hour (+8%) 7 Manufacturing capital strategy Flexible Large scale capacity increases Investment for new product innovation Cost reductions eg package lightweighting Safety, environment projects LTIFR, Water Use Aim to reduce incremental investment by 25% Challenging standards Water treatment Adapting existing capacity CSD to Hotfill Used machinery Darwin, Melbourne, Pac Bev Flex line Lower cost new machinery Monitoring to ensure ROCE positive 8 4

5 Highlights of manufacturing investment Product type Investment Results Water Juice & Powerade Water $18 million QLD Water Line in 2004 $5 million Pacific Beverage Line Upgrade in 2005 $2.4 million Pacific Beverages convert Disney line in New packaging formats An extra 134 million litres per year ensures east coast supply for 10 years Reduced cost New products HORECA still water in glass and improved tasting juice products An extra 27 million litres of Powerade per year meets growth for 2 3 years Support new flavoured water variants $1 million interstate freight savings Future investment is planned for growth product categories Non-carbonated Beverages Carbonated Beverages Water 29% Planned Investment CSDs 24% Investment will focus first on low cost conversion of existing capacity to water & hotfill products Hotfill 22% Juice 25% Product specific manufacturing investment e.g. excludes warehousing, IT etc. 10 5

6 Logistics capital strategy Automated warehouses and warehouse management systems Remove labour costs Remove double handling costs by consolidating Improve customer service Reduced error rates Greater Inventory Accuracy Provide a single CCA platform for future category expansion Avoid exponential future cost increases 11 Mentone warehouse investment is rewarded with performance beyond expectation Measure Average from CCA s traditional warehouses Productivity (cases/man hr) Mentone Accuracy of inventory records Error order picking (errors per 1000 cases picked) Pallet Movements per 1000 cases sold Cost per Case (inc depreciation) 90.0% 98.6% $0.76 $

7 Mentone provides a good model to simplify & reduce cost in our NSW logistics network. Current NSW Logistics Network 2005 Outbound Inbound Smithfield DC Canberra Break-Bulk Route Customers Northmead Plant 102 Briens Rd Newcastle Break-Bulk Route Customers Smithfield Plant Outbound Outside Storage Route Customers Inbound Grocery Customer DCs 13 NSW logistics will be simplified by 2008 Future NSW Logistics Network 2008 Inbound Outbound Eastern Creek DC Northmead Plant Smithfield Plant Route Customers Grocery Customer DCs 14 7

8 Northmead bulk warehouse will provide 50,000 pallets of storage capacity and reduced operating costs $180 million investment gives: 50,000 pallets of storage, a picking facility with capacity till 2015, space for 4 more production lines, reduced freight & outside storage costs. 15 Eastern Creek mixed pallet warehouse will provide picking capacity till 2015 with storage expansion options 16 8