Case Study: Asda Direct revamps distribution centre IT

Asda is deploying software from Manhattan Associates to support the future growth of its e-commerce site, Asda Direct

Asda is deploying software from Manhattan Associates to support the future growth of its general merchandise e-commerce operation Asda Direct.

Asda will deploy the software in several distribution centres across the UK where Asda Direct orders are fulfilled. Initially, the software will be used to manage internet orders from the Asda Direct website.

Asda Direct is focused on general merchandising. It sells a range of goods from electrical appliances and clothing to home furniture, toys, home entertainment products, garden and outdoor equipment and baby items. When the business started five years ago, the company worked with Clipper Logistics to fulfil Asda Direct orders from an e-fulfillment centre in Ollerton, Nottinghamshire.

However, since the Ollerton facility is run by Clipper, Asda Direct has limited scope for expansion.

Paul Anastasiou, head of distribution for new business at Asda Direct, said: "We wanted a systems platform that would allow us to enhance the overall efficiency of our distribution processes and offer complete visibility of inventory throughout our operation."

He said Asda Direct needed a supply chain technology platform that could integrate with the company’s  core systems and support Asda’s business growth  and expansion goals.

The Manhattan technology will support a range of ordering and delivery options, which will extend as the deployment project progresses.

The business process

At Asda Direct, fulfillment centres are treated like large stores. “We put forecast and demand planning information into the Manhattan Associates system. Once stock is on the warehouse system it is ready to order from our website. Manhattan gets a notification that a product is available," said Rob Wilks, distribution systems manager, Asda Direct.

He said the Manhattan system then tells the website what products are in stock. “There will be integration between the content management system and our replenishment system.”  The project also involves integration to updates the finance system and Metapack, the system used to route packages to carriers for delivery.

Complex integration

Wilks said: "The project involves installing the Manhattan Associates warehouse module at the Ollerton site. It will require integration into our systems like SAP, which we use for finance.

"The IT integration is greater than I have ever done before.” 

Asda Direct is just completing the design phase. A team from Manhattan Associates has worked with Asda’s onsite team on the project. 

Wilks said: "We have been looking at how we are structured and the building set-up." 

Manhattan Associates developed a prototype. The configuration phase of the project begins this week. Wilks hopes to pilot product lines by Christmas. He has no plans to roll out until after the Christmas period is over.

He said: "We won’t put our eggs in this basket for Christmas. We won’t be jeopardising Christmas. 

"But we will use the time to test the end-to-end process."

Future development

Over time, Wilks said Asda will centralise the server environment in its distribution centres. At the moment, it runs 28 depots, each with their own server room. This will involve running isolated 10 Gbps point-to-point networks links between locations backed up by ADSL.

"Whilst we will initially focus on deploying Manhattan’s Warehouse Management solution, the potential to implement additional, complementary, solutions from the Manhattan product suite, and what that gives us in terms of future flexibility and adaptability, was a big appeal to us," Wilks added.

Following deploying in Ollerton, the next site is the Lymedale clothing site in Stoke on Trent. By installing Manhattan at the Lymsdale distribution centre, Wilks said Asda Direct would be able to avoid transporting clothing the 80 miles to Ollerton, which would reduce costs.

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