Frucor Extracts Best Value in Strategic Partnership with SAP Expert
Client:
FrucorChallenge:
- Shift from a 'make to stock' to a 'make to order' manufacturing process
- Eliminate container hand stacking and repacking
- Introduce raw materials handling to track receipt and consumption of materials
Solution:
- Implement major changes to SAP manufacturing applications
- Redesign the way orders were fulfilled and ensure logistics were streamlined
- Manage two major, interdependent projects simultaneously
Results:
- Stock palletised on the line ensuring product gets to market much faster
- Reduction in health and safety risks and signficant reduction in damaged goods
- Complete visibility over all export stock and improved inventory control
Since its beginnings in the early 1960s, Frucor has evolved from a small New Zealand juice business to a leading Australasian beverage company, and the market leader in energy drinks in Australia and New Zealand. In recent years IT has become an increasingly important enabler for Frucor to grow its operations, streamline its processes and simplify its manufacturing and logistics — enabling it to get products out the factory door faster.
Forging a fruitful strategic partnership
The successful completion of two complex, highly strategic SAP projects at Frucor is a lesson in the value of a customer and its systems integrator forging a fruitful strategic partnership.
DXC Oxygen has become one of Frucor’s key external IT vendors. It has helped the leading beverage company become one of the smartest operators in the industry, thanks to a world-class direct containerisation project and an ambitious warehouse management refit to replace manual processes with SAP technology — two of the company’s biggest IT-enabled projects completed to date.
Richard Raj, group IT solutions manager at Frucor, says the effective fruition of the two projects has seen DXC move from the position of IT supplier to strategic partner.
Made to Order and Out the Door
When Frucor’s direct containerisation project went live in May 2014, it was the successful culmination of an IT project, physical site works and change management program. It turned the old manufacturing philosophy of “make to stock” on its head as Frucor endeavoured to improve efficiency with a transformation to “make to order.” The project simplified the business-critical process of shipping products from New Zealand to Australia by eliminating container hand-stacking and repacking. It was a change that sounded simple but required major SAP system changes and a massive effort from teams in both countries. Adding to the risk, another major manufacturing change, Project Fusion, was due to go live at the same time.
“It was very complex,” says Raj. “As well as creating the new production line, we had to continue with the ‘make to stock’ process for our New Zealand supply of beverages. We had to redesign the way we fulfilled the orders and ensure we had the logistics streamlined to enable us to produce, pack and ship the goods in containers, in one seamless operation.”
Success Breeds Success
“What was a two week operation has come down to a few hours, and we can now get product to market a lot faster. Before, we had team members taking product from warehouses, then manually stacking it onto Australian pallets and into Australian containers. Now Australian product is palletised on the line and packed directly into containers.”
Raj says a number of factory innovations introduced with direct containerisation, including automated palletising, have minimised health and safety risks and saved money thanks to a significant reduction in damaged goods.
Frucor now has complete visibility over all export stock, and inventory accuracy is outstanding. At the Australian end, loading and unloading of stock has improved dramatically. “All they have to do is unload, scan and put away — there is no assembly needed.”
Read the full success story.