Supply Chain Blueprint

Strategy
Sainsbury's multi-million pound investment in its Supply Chain will create one of the most advanced grocery distribution operations in the world. Over a three year period the Supply Chain will be transformed to provide improved on shelf availability with a paperless, stockless, accurate and flexible service designed to meet the current and future needs of the business. The Supply Chain strategy, launched in the autumn of 2000, covers four key areas of activity: network renewal systems and technology processes and partnerships people and culture
Network Renewal
Modernising, upgrading and expanding the distribution centre network and transport operations to provide improved availability and accuracy at lower cost
Supply Chain Goal Supply Chain Vision

Excellent service at unbeatable cost, delivered by great people
People + Culture
Leading transformation
Our aim is to establish a Supply Chain team with three core values: passion courage integrity The new-look Supply Chain will be based on an integrated, end-to-end approach, managing all aspects of transportation and distribution from the factory gate to the store back door. The overall goal is to create a Supply Chain based on a number of key principles: paperless stockless accurate simple automated where appropriate
Introduction of new attitudes, skills and flatter management structures to achieve a flexible, responsive and committed workforce
Creating a world-class Supply Chain for
Systems & Technology
Processes & Partnerships

Creation of new processes which link all elements of the supply chain from suppliers to the shelf to provide the most efficient service at least cost, as well as creating a new level of co-operation through partnerships with colleagues, unions and suppliers
Replacement of all existing warehouse management, transport and supply chain planning systems with state-of-the-art technology
Performance
Improved performance will be achieved through reductions in cost per case, improved availability, reduced stock loss, greater accuracy of delivery and schedule adherence while achieving required levels of service
...faster, simpler, together
Supply Chain
Supply Chain blueprint
Sainsburys Supermarkets Holborn Business Centre 33 Holborn LONDON EC1N 2HT Telephone: 020 7695 6000
November 2001
The heart of the Supply Chain

St or es
The key principles in developing the new Supply Chain network involve creation of an holistic, end-to-end approach to distribution. This will embrace fully electronic collaboration and communication with suppliers, allow for continuous replenishment of products with minimum handling and provide a more store friendly service. The new network currently being developed consists of:
Primary Consolidation Centres (PCCs) handling shipments from local suppliers, holding stock and replenishing fulfilment factories Fulfilment Factories (FFs) store facing multi-temperature sites handling around 10,000 lines of high volume commodities (excluding frozen products). The fulfilment factories will handle waved deliveries to stores on a round-the-clock basis, keeping stock levels to a minimum. The plan is for nine fulfilment factories, six automated and three manual, in the new network. K Line depots two specialist distribution centres using highly-automated sorting systems enabling them to efficiently pick low volumes of a wide range of up to 16,000 slow moving and bulky products Each fulfilment factory will have a range that includes ambient, chill and produce lines and will serve over 70 supermarkets and up to 150 smaller format stores. Each of the new fulfilment factories will be around 650,000 sq ft in size, covering 40 acres and costing 70 million. The automated handling systems and other mechanical handling equipment accounts for well over a third of the overall cost. Frozen food depots two dedicated frozen food warehouses delivering products direct to stores
Customer centred delivery focus taking account of the needs of the supply chain, stores and customers
working will be involved in the highly automated environment. Continuous throughput of products will mean a vehicle leaving or arriving at the warehouse on average every two minutes around the clock. Typical daily routines will involve chilled products arriving in waves from 5am onwards, being held in a 1,000 pallet capacity buffer, ready for pallet and case stripping onto the auto retrieval sortation system. Advance chill deliveries will start leaving the site by mid afternoon and continue as either dedicated loads or combined with ambient products right through into the late evening. Ambient products will be received around the clock ready for sorting via a two-tier cross belt sorter with more than 170 chutes and up to 4,000 pick slots.
DAY IN THE LIFE....

With a peak weekly capacity of up to 2.4 million cases, each fulfilment factory will operate on a 24/7 basis, with picking and sorting taking place on average 20 hours each day. Each of the new sites will act as a mother depot to more than 200 supermarkets and smaller format stores, with nearly 2,000 vehicle journeys each week.
Su pp lie rs
The 700-strong workforce will have a variety of shift patterns to cover ambient, chill and produce picking. New skills and ways of
Current Sites Sites under construction Potential Sites
Collaboration with suppliers, sharing data, working jointly to deliver value to the customer within a 24/7 paperless system
Key Programme Contacts

Strategy Management - Richard Dickson
Business Requirements, Assumptions, Vision, Cohesion, Direction Setting
Key Programme Milestones

KEY
Site Acquisition
Programmes
Programme Management - Mike Adams

Overall Resource Management, Reporting, Escalation, Comms, Priorities, Risk Managment, Quality and Audit
Project
Hams Hall Waltham Point FULLFILMENT Greenham Park FACTORIES North London South East London Stoke K LINE FACTORIES Rye Park Phase 1 Phase 2 PkMS (Phoenix) Launches TECHNOLOGY RETEK (Cygnet) 1
2001
2002

2003

2004
2005
Strategy & Migration Planning Infrastucture Delivery
Ian Packer
Systems & Core Processes

Mike Adams
Dependant/ Processes Capabilities

Ian Fidler
Operations & Tactical Planning

Nigel Basey Andy Sanderson Andy Strudwick
Transport & Consolidation

Richard Dickson
Stoke Rye Park Hams Hall Walthm Pnt Greenham Park Elstree Stone
K-Lines - John Rogers
MHE
Installation Starts
John Perman
Fulfilment Fcts 1 - Stephen Ottaway
MHE Testing Site Handover
Opening and closure timings New Sites
Site design Buildings Automation
Phoenix Firewing SABRE/ SCION Replatforming B2B
Supplier conformance Store friendly agreement Operations timescales Single Units
Teams of people to run new sites and central systems Short term changes (1-12 months)
Transport Planning Importation and Global Logistics
Fulfilment Fcts 1 - Peter Niland
Frozen Network
Site Fully Operational
Haydock Rotherham Charlton Emerald Park
Warehouse concepts
Primary Consolidation Centres
FGP/TO - Richard Dickson
Forecasting
Langlands Park Hoddesdon Emerald Park Charlton Buntingford Basingstoke Elstree Rugby
Replenishment Planning
Associated Systems
Park Royal Gorton
Replatforming - Mike Adams
TRANSPORT
NTSC launched
Haydock Stone
Rotherham Shire Park
Picking Centre - Paul Woods

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Strategy

Supply Chain Goal Supply Chain Vision

Creating a world-class Supply Chain for

Systems & Technology

Processes & Partnerships

...faster, simpler, together

Supply Chain blueprint

The heart of the Supply Chain

DAY IN THE LIFE....

Current Sites Sites under construction Potential Sites

Key Programme Contacts

Key Programme Milestones

Programme Management - Mike Adams

Systems & Core Processes

Dependant/ Processes Capabilities

Operations & Tactical Planning

Transport & Consolidation

K-Lines - John Rogers

Fulfilment Fcts 1 - Stephen Ottaway

MHE Testing Site Handover

Opening and closure timings New Sites

Site design Buildings Automation

Phoenix Firewing SABRE/ SCION Replatforming B2B

Supplier conformance Store friendly agreement Operations timescales Single Units

Transport Planning Importation and Global Logistics

Fulfilment Fcts 1 - Peter Niland

Site Fully Operational

Haydock Rotherham Charlton Emerald Park

Primary Consolidation Centres

FGP/TO - Richard Dickson

Replatforming - Mike Adams

Rotherham Shire Park

Picking Centre - Paul Woods

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