Despite already being one of Europe’s leading alcoholic beverage producers, Tim Brown finds out from Constellation Europe manufacturing manager, Richard Lloyd, how a recent capital investment has facilitated an evolution of their manufacturing and supply chain processes.
Constellation Europe’s recently constructed purpose-built manufacturing and warehouse premises in Bristol has been the catalyst for a large number of operational changes at the company. The need for such an investment was instigated by the continued growth of its extensive portfolio of more than 100 consumer brands across the wine, beer and spirit markets. With major brands including Robert Mondavi, Hardys, Ravenswood, Corona and SVEDKA Vodka, the need for Constellation Europe to consolidate a number of sites into one streamlined manufacturing, distribution and storage plant became a necessity to improve efficiency and meet increasing demands.
According to Richard Lloyd, the new development in Avonmouth, named Constellation Park, has allowed the company to alter almost every aspect of its operational footprint. While the changes have been widespread, particular emphasis was been placed on improving Constellation’s supply chain and packaging procedures.
“One of the main drivers for the new site was to realise distribution and also environmental impact savings by actually bottling products within the country of sale,” says Richard. “Previously the majority of, for example, the Hardy’s range was bottled in Australia which obviously meant that the bottles and packaging were being shipped halfway around the world. It’s obviously a lot more cost efficient and environmentally friendly to ship the wine in bulk containers and actually bottle it at its final destination. There was a need therefore to increase the operational capacity within the UK so the business had the flexibility to be able to transfer the bottling of a number of its new world wines across to the UK.” The complexities and sheer volume of such a process is nothing if not impressive. In essence, the wine is loaded up at wineries around the world into sealed containers; a mixture of 24,000L bags and stainless steel containers. It is then shipped across the world to Bristol.
From the port, the wine vessels are delivered to the Constellation site where a 24,000L container can be unloaded in just under two hours. A storage facility of over 4 million litres exists within the site which equates to approximately two days worth of production.
The wine is pumped directly from the 54,000 litre storage tanks to the two high-speed production lines and three bag and box lines. The bottling lines incorporate the latest in processing technology, not only with regards to the speed with which they operate but, according to Richard, they also ensure the optimum quality of the wine and packaging through advanced filtering and handling systems.
While the concept of country of sale processing was economically sensible and more environmentally viable, realising the dream was logistically complicated. Ensuring the building was constructed with the correct capacity to maximise packaging and storage efficiency for the bulk products was a careful balancing act. “One of the biggest challenges,” says Richard, “was to design a site that whilst large in scale didn’t then introduce other operational difficulties by the sheer scale of it and yet was large enough to accommodate future development. We needed to design it to meet current market demands but also with a view to what the future of the industry might require and not later constrain the operational benefits that we’re now gleaning.”
To reach the optimum scale for the new premises, Constellation kept lean operational principles at the forefront of their minds during the design process to ensure that the product flow through the site would be as efficient as possible. “We spent a lot of time modelling and working product flows, trying to understand where the constraints would be and removing those constraints…Because we are predominantly a new world wine business, the shipping routes and duration of the shipping routes are extensive and therefore significant work had to be done looking at the amount of wine storage facilities we needed on the site so to ensure that any variability that happened in the supply chain, did not have a direct impact on the efficiency of the actual manufacturing unit.”
Since the new plant began operation, key Lean principles have been adopted into almost every facet of Constellation’s operational philosophy. “We aim to achieve very much a standard way of operating to ensure process reliability and this is done through tools such as 5S and TPM. We have OEE as our key measurement which we use to drive our line performance on the site.
We use a problem solving structured technique called A3 which is out of the Lean philosophy. So in essence we operate with an objective to remove any variations in our process and we do that by trying to utilise 5S to have a standard workplace environment. We then have our OEE which tells us which direction our performance is moving and where we have variations. We then look at addressing our machinery variations and issues through the TPM nine-step model.
And where we do have ongoing variation that we are struggling to control, we then use an A3 problem solving technique to eliminate this variation.” “We are constantly working with our supply chain to ensure that our deliveries of raw materials and bulk wine arrives onsite just in time for its production. Whilst we’re a large site, with our considerable through-puts involving filling in-excess of 65,000 cases of wine a day, holding large quantities of raw materials is not really effective. So the majority of our required raw materials arrive on-site within 48 hours of production.” The site, which has only been operational for just over 6 months, is nearing the completion of its commissioning period, which will mean the transfer of an even greater volume of bulk product from their other production sites around the world. In the first year, Constellation Europe envisages achieving an output of approximately 120 million bottles. However, the site has the capacity for that to increase to in-excess of 200million bottles a year, a target they are hoping to reach within the next few years.
The Lean approach and consolidation of their various sites has also meant an improvement of the companies environmental impact. The ability to ship their wine in bulk as opposed to a finished goods state, has resulted in an impressive reduction of unnecessary packaging transportation. Constellation have also moved to a lighter weight bottle so therefore reducing the amount of glass they actually use within every bottle they package.
“There has been a significant investment in all personnel on site, for instance every operator and engineer who operates the bottling line has spent a minimum of three weeks in Germany at a training academy. All of our roles within the industrial side are trained to a minimum of NVQ level 2. The new site has given us the opportunity to create a step change and to review all operational practices and to cement and build on successful ones from before but also then move away from practices that hindered the business and individuals.”
The level of improvements achieved as a result of the development of Constellation’s new plant have been extensive. By considering how the design of the construction would impact on the implementation of Lean principles within their manufacturing operation, Constellation were able to ensure the building was conducive to the most efficient production processes possible. And, with the full production capacity yet to be realised, the ability for Constellation to further consolidate and generate even greater sales figures is, most likely, only a matter of time.
Another considerable change to their operational component which has been initiated by the completion of the new building has been within the area of human resources. “There’s been a significant increase in the number of engineers within our operational workforce. Compared to our old site, our productivity levels per head have doubled and that is through more efficient manning structures within the site coupled with the higher machine speeds.”
