Ben E. Keith Co. Beverage Distributors, Fort Worth, Texas, distributes on average 155,000 cases a day. The company will distribute approximately 37 million cases of Anheuser-Busch InBev products and 2.1 million cases of craft and import beers this year. In a territory that spans Texas for its craft and import beers and 61 North Texas counties for its A-B InBev products, the wholesaler operates 11 distribution facilities and five sales centers. Ben E. Keith’s total beverage division is 1.2 million square feet under roof and operates on about 160 acres of property.
“Texas is a great place to do business,” says Flint Prewitt, Ben E. Keith Co. Beverage Distributors’ vice president of sales and operations. “There are endless opportunities for the beer business in this state. This is very apparent within the retail chain business. Chain retailers can benefit from our statewide footprint by receiving consistent pricing, promotional activities and merchandising for many specialty import and craft brands throughout the state.”
Many challenges also come from distributing in a state as large as Texas, such as maintaining the quality of the product at what is preferred by the supplier. Many of Ben E. Keith’s specialty beers require continuous refrigeration.
The company’s growing number of SKUs also provides challenges. In October 2009, the wholesaler handled 1,800 SKUs and grew to 2,080 SKUs by the end of July 2010, says Paul Holton, Ben E. Keith Co. Beverage Distributors’ vice president of operations.
“Three years ago, we were handling 200 SKUs, and now we’re handling over 2,000 SKUs,” he says.
The sales force has implemented new handheld computer technology to manage the growing number of SKUs, and warehouse operations have installed new warehouse management systems (WMS) and voice picking. In addition, Ben E. Keith is using more racking, such as flow, gravity flow, pallet flow and carton flow racks, in its warehouses to evolve as the number of packages expand.
The company began implementation of WMS in July 2008. Fort Worth, Dallas and Denton were the first facilities to get WMS, and the wholesaler plans to slowly roll out systems to the rest of its facilities.
“Our inventories are live every day under this new system versus being a day old,” Holton says. “We sell 24 hours out.”
The new WMS have helped the sales force by supplying them with live inventory daily and keeping them abreast of what products are available to sell. Prior to its new WMS, in the three branches where they have been installed Ben E. Keith inventoried daily. The company now has a dedicated person for inventory, and he still inventories every day, but he does not count the cases daily. The employee now uses the system to count the inventory, and the variances he sees is what is counted. A total walkthrough and total count are still completed at the end of every month.
WMS helped Ben E. Keith with its warehouse capacity as well. The system tells the warehouse operator where to place products, instead of determining where to place it himself or wondering if he would have enough room. The system also tells operations exactly when the warehouse will be out of room.
“Prior to that, you as a forklift operator decided where you were going to go put product. So your warehouse could fill up rather quickly in odd places, and suddenly you thought you were out of space when in reality you could have space hidden in between pallets of products poorly placed,” Holton says. “The WMS has helped us use every inch of our space.”
For the three locations that the wholesaler installed new WMS, it also brought in voice pick. The voice pick system allows employees to speak in several languages, and it will speak back to them in their native language or in English. The warehouse operators also benefit by knowing where to find products without needing to remember the name of each product. The warehouse is labeled by location, and the system takes warehouse operators to the location and informs them of the number to pick. If an operator were to have a question about the pick, he could ask for verification by name, and the system would read the name and number to him.
“For our warehouse people, who find and pick things, their pick error rate is less than 0.1 percent right now,” Holton says.
Although the voice pick system has decreased errors within these branches, it is still undecided whether all branches will receive this technology. “If a location is distributing 1.5 million cases a year or less, it most likely will not use this system,” Holton says.
By the end of this year, the company will have expanded approximately 130,000 square feet of warehouse and office space at its Dallas branch. The current offices and warehouse in Dallas encompass 330,000 square feet and sit on approximately 30 acres. Ben E. Keith’s Dallas branch is its largest and currently operates at 80 percent of capacity, Holton says.
For the offices, the expansion will allow the Dallas division to engulf one side of the building while corporate offices will be moved to the new addition. The offices will be connected by a lobby with a central entrance. The office expansion also includes a lower level parking area that could be closed in to create another 30,000 square feet of office space if the company needs it in the future.
The square footage added to the warehouse is primarily for a refrigerated vault to accommodate the growing number of craft beers the wholesaler handles. Extra package storage also will be added. In addition, the company is scheduled to build another 60,000 square feet for product storage that is expected to be completed next year.
The Dallas warehouse currently is 180,000 square feet of controlled environmental warehouse space, and the refrigerated storage space is about 22,000 square feet. Temperature for Dallas, as well as all the Ben E. Keith beverage facilities, is controlled from the operations office in Fort Worth. Each location is closely monitored by alarms so any temperature problems can be corrected quickly.
In the warehouse, product is replenished and cycle counted before the order selectors start picking at about 1 p.m. for the next day’s delivery. Most orders are received by 4:30 p.m., but sometimes arrive as late as 6 p.m. The system lets the order selectors know how much they have to pick, how much they have left to pick and what percentage they have to complete via a monitor in the warehouse.
Warehouse order selectors are divided into several tasks. In case pick mode, an operator picks every case to go on a pallet. In case top mode, the operator adds individual cases to a pallet that already has layers of product. The warehouse also has layer pickers and full pallet pickers. A keg picker operates in the company’s keg vault. Other tasks such as replenishment and truck loading work in the same manner.
Operators are assigned a specific mode and the voice picking system won’t assign them a task outside of their mode. For example, an operator on a pallet jack with a headset will not be assigned any task that pallet jack can’t do, Holton explains. Once an operator is assigned to a task, the operator works that tasks until it is complete. Only then can an operator sign on to another task, but he can only take on a task that is compatible with his equipment.
Overall order selection for the warehouse pick shift runs at a rate of 230 to 240 cases an hour. When they finish their pick, operators will go to a stretch wrapper to wrap the products. A ticket then is printed that includes every item on the pallet, what account it’s going to and if there are any more pallets associated with it. All pallets are staged in lanes by the route number of the truck they will be loaded onto. A crew arrives at 9 p.m. to start the loading process.
Ben E. Keith’s total company operates 323 delivery trucks daily from 11 facilities across Texas. The Dallas facility makes up 112 of those delivery vehicles, servicing 3,200 retail accounts in Dallas, Ellis and Collin counties. This is a quarter of the more than 12,000 retail accounts serviced statewide. BI