As the product variety and volumes climb, some in the beverage industry are taking a closer look at automated materials handling and warehouse management systems to increase distribution responsiveness and flexibility.

On the product development front, change is brisk in the beverage industry. New product categories, flavors, and packaging are the norm. But on the distribution side, companies have done little to change primarily manual materials handling operations. That, however, may not be the case for much longer.

"To a great extent, the industry remains almost entirely reliant on manual operations at smaller facilities," says Greg Ellis, beverage industry practice leader with the consulting firm St. Onge.

The dynamics of direct-store delivery have much to do with the scant use of automation, says Ellis, especially in the soda sector. Distributors must maintain satellite DCs and warehouses so that time to retail outlets is minimal. The labor needed to run these facilities might be high, but the model ensures rapid replenishment and a short, reliable last mile to the consumer.

However, industry experts see growing reasons for change. One is the continuing proliferation of stock keeping units (SKUs). Brian Bussell, vice president of operations and supply chain at Atlanta-based Coca-Cola Enterprises (CCE), the world's largest distributor of products of The Coca-Cola Company, says CCE handles 400 SKUs in some regions. "The days of very few products, flavors and package configurations have long since been left behind," he says.

Click here to read Modern's other online Supplements.

Click to download the free Adobe Acrobat Reader.