Lees sees snowball effect of real-time warehouse management.

Lees sees snowball effect of real-time warehouse management.

Lees of Scotland has produced a range of iconic confectionery including snowballs, teacakes and meringues, since the 1930s. An important local employer, the company operates from a purpose built, 82,000 ft manufacturing facility in Coatbridge, near Glasgow. Now a £20m a year business, innovation is an important factor in the company’s continued success and the launch of a new range of nut and gluten free ‘Macaringues’, an allergy friendly alternative to baked macarons, demonstrates this.

Lees had previously managed elements of its warehouse operation using a paper-based system. This involved documenting every item coming into the facility, its use within the manufacturing process and concluding with warehouse pallet references for the storage of finished goods and final destination locations.

Up to date information for use across the business

One area where Lees faced challenges was handling and storage of finished goods. This involved warehouse operatives writing down best before date and batch number details of thousands of products coming from production by hand. Time consuming and prone to errors, this created problems further down the supply chain when administrators would input data onto Lees’ ERP system, resulting in system data that was never fully up to date.

Stock putaway was also a manual process. Operatives would have to visually identify a location available, check its suitability and then document it during the put away process. Mistakes would be made when recording location information or because handwriting was illegible. This impacted picking rates because operators would go to a location expecting to pick a number of items, only to find the goods were not where they expected. “It’s difficult to quantify exactly how much time was being wasted but overall, we had lots of issues relating to efficiency and data accuracy and needed to invest in warehouse management technology to improve the situation,” says Steven Purves, Supply Chain Director at Lees.

Standardised processes for goods handling

After a review of warehouse management software (WMS) solutions, Lees selected Indigo Software as their WMS provider and implemented the production booking and intelligent putaway modules. This created a standardised process for handling finished goods and ensuring mistakes were not occurring. Plus data was available in real time and stock was being managed efficiently.

“One of the main benefits of Indigo was the immediate improvement we saw to stock management and traceability. Although we always picked in rotation by best before dates, our products lacked a unique label ID,” says Steven Purves. This prevented Lees from locating individual manufacturing batches at the pallet level and they would primarily identify products by best before dates. “It was very difficult to isolate products to a set time of manufacture, whereas now using Indigo, we can pull off a set of labels and track goods to a few pallets in the warehouse. It’s had a huge impact on our traceability and control management,” adds Steven Purves.

Putaway is now a seamless process too. “When products come into the warehouse from production, operators scan the barcodes on the works order sheet and specify the quantity. The system generates a unique pallet label and at the same time, suggests a series of suitable putaway locations. If the operator considers them unsuitable, he can search for an alternative, capture an appropriate override reason code and have the put away rules amended if necessary,” adds Steven Purves.

Reduction to stock picking errors

These improvements have led to the elimination of stock picking errors, which has enabled Lees to grow its business over past few years, without the need to increase headcount correspondingly. “Using Indigo allows us to pick more orders more accurately within a shorter space of time, which helps us to better control peaks and troughs in demand and long term labour costs.

Currently, Lees is making further improvements to its warehouse operations, with the addition of Indigo’s purchase goods receiving module to optimise the management of raw materials as they enter the manufacturing facility. This was also previously a manual operation, with warehouse staff recording information by hand and then searching the warehouse for a storage place.

Operators scan the purchase orders of raw materials, creating a unique pallet reference for each pallet of goods delivered. This identifier takes into account any special considerations, e.g. storage rules for allergens, and suggests a suitable location for the pallet, which is marked with a unique pallet ID. “Retailers require us to trace everything from raw materials right through the production process. Previously Lees used a paper based system to do this, which was time consuming and often difficult to reconcile.” says Steven Purves.

End to end product traceability

Traceability is an essential capability for Lees, who supplies major retailers and independent stores across the UK. Now they can respond quickly to audit requests, with automated reports set up to gather the data required.

“One of the best things about working with Indigo is their wealth of experience in the food industry. Their consultants are highly knowledgeable and have helped us to apply the best insights from all their client projects to benefit our operation. We have made huge improvements to stock accuracy, traceability and efficiency, future proofing our business for years to come,” Steven Purves, Supply Chain Director at Lees of Scotland.

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