Nisa-Today’s spent the closing weeks of last year fighting back from a crisis at its new Scunthorpe depot. Rod Addy reports
Nisa-Today’s is by no means out of the woods yet. This week, it revealed further problems with its IT audit system, which have hit frozen and ambient distribution causing yet more late deliveries for retailers (see News).
Last year was one of the most painful years in Nisa-Today’s 28-year history. First there was the row with its wholesale members over subscription fees. Then, in July, rumours began to circulate that chairman Dudley Ramsden was trying to dramatically boost his power within the business and with it his salary. Cue discontent among its wholesale members and a narrowly averted rebellion by some in August.
News that it had postponed its agm from the end of November to December 22 fuelled further gossip. But Nisa-Today’s biggest struggle, the main reason cited for rescheduling its AGM, involved the launch of Project Vision, its 625,000 sq ft ambient national distribution centre at Scunthorpe.
Given that the warehouse was one of its most ambitious projects to date, serving a total of 3,100 stores, teething problems were inevitable. But, even before it was finished, a row erupted when Nisa-Today’s asked suppliers to put off sending invoices for goods delivered to the site until November.
The saga kicked off on the weekend of October 28-30, when the company’s management team faced the mammoth task of shifting 2.3 million cases of stock into the new depot - in a bid to consolidate the two existing depots at the site into one building.
“With the benefit of hindsight, we should have taken more time over the move,” says group commercial MD Neil Turton.
He points to the Hallowe’en gremlins that got into the warehouse management software on October 31, knocking the delivery schedule back by a day so that retailers received their first orders three days after making them, rather than two.
“The problems lay in the bit of the system that splits the depot into different areas for order picking,” says Turton, explaining for the first time in detail what went wrong. That, in turn, caused difficulties organising goods to be loaded on to trucks for delivery at the goods out stage.
Things soon snowballed. Retailers began to panic as they became aware of the situation and the company was swamped with orders for ambient goods to make up for gaps in stock, with the rapid onset of Christmas looming large in their minds. Discrepancies between deliveries to and from the warehouse grew as the schedule was thrown, leading to some retailers complaining they were short of almost 20% of what they had requested. The warehouse crew were playing an increasingly desperate game of catch up.
“At one stage we thought, ‘bloody hell, we’ve got a real crisis here’,” says Turton. Nisa-Today’s management team met for a council of war at 6.30am on Saturday, November 19. “We needed time to think things through without phones ringing.”
The team faced a grim choice. They could shut down the warehouse completely until they were back on track. Or they could issue a call for all hands on deck and work around the clock to claw back lost ground.
Complete shutdown would have caused worse stock shortages for retailers, says Turton, adding that the surge in demand after the depot was reopened would have created yet more problems. So, instead, they elected to keep the warehouse running and turn the situation around at the same time.
The management team met warehouse bosses and mucked in with staff on the floor picking orders to make up the backlog.
Managers directly involved in Project Vision, who had been working seven days a week since its launch, often did not go home until two or three in the morning, surviving on just a few hours sleep.
Turton confesses that, like many of his colleagues, he was living on takeaway meals at the office. “My wife joked that it looked like I was having an affair,” he quips. “I had to show her copies of The Grocer to convey what was happening.”
Giving up their personal time was not the only sacrifice. Slapping restrictions on orders to help workers keep pace with demand was another tough decision. Turton himself bravely posted his mobile number on Nisa-Today’s web site as the major contact point for retailers. That way, he explains, he could act as a buffer, protecting warehouse staff from being disturbed while they focused on the task in hand. Even the office Christmas party was postponed until January 13 while the issue was being resolved.
Regular updates on the state of play were e-mailed to retailers and flagged up on the internet and in Nisa-Today’s Consortium magazine. The depot played host to 40 delegates from the company’s core retail customers, who were shown around to highlight exactly how things were being tackled. Nisa-Today’s also opted for a policy of transparency with the trade press.
In addition, posters were sent to all the retailers it supplied, confessing that the blame lay with Nisa-Today’s, not shopkeepers, and asking customers to bear with them.
The strategy began to pay off. There was no room for damaging rumour or misunderstanding and Nisa-Today’s was careful to communicate every stage to members so they could see exactly what was happening.
Nisa-Today’s insistence that everything was under control began to win members over. In fact, many pitched in to help, with Costcutter volunteering its entire sales force to inform retailers of allocation amounts.
The tide turned after the first week in December, when delivery schedules began to revert to normal.
Nisa-Today’s is also gearing up for its most radical promotional blitz ever after Easter to make things up to retailers and help woo lost customers back to stores.
And a positively received annual general meeting last month has done much to further assuage members’ concerns. At the meeting, it underscored its commitment to its independent customers by resolving to change its articles of association to exclude supermarkets such as Sainsbury and Somerfield from holding shares.
While it says it is confident that the issue will be swiftly resolved, the setback will inevitably raise questions about what this year holds in store.
But after the tumultuous events of 2005, the Nisa-Today’s team must surely be feeling that things can only get better.
2005: a year of pain
>>Timeline of Nisa-Today’s annus horribilis
March/April: Dispute with chilled and frozen suppliers over cutting cost of goods
May: Launches Day-Today fascia scheme for retailers in Scotland
July: Brings in dual branding with retailers and unveils plans to trial multi-temperature deliveries. Dispute with some wholesale members over subscription fees. Rumours circulate that chairman Dudley Ramsden is negotiating for more money and power
August: Dispute with suppliers over demands to delay invoices for deliveries to Scunthorpe ambient warehouse
September: Unveils New Era trading terms for retail members at annual conference
October: Somerfield chairman John von Spreckelsen expresses unease over relationship with Nisa-Today’s in letter leaked to national press. Rumours circulate that he is to take over from Dudley Ramsden as chairman
November: Crisis hits new Scunthorpe ambient distribution centre
December: Resolution at agm disallowing multiple retailers from membership
Nisa-Today’s is by no means out of the woods yet. This week, it revealed further problems with its IT audit system, which have hit frozen and ambient distribution causing yet more late deliveries for retailers (see News).
Last year was one of the most painful years in Nisa-Today’s 28-year history. First there was the row with its wholesale members over subscription fees. Then, in July, rumours began to circulate that chairman Dudley Ramsden was trying to dramatically boost his power within the business and with it his salary. Cue discontent among its wholesale members and a narrowly averted rebellion by some in August.
News that it had postponed its agm from the end of November to December 22 fuelled further gossip. But Nisa-Today’s biggest struggle, the main reason cited for rescheduling its AGM, involved the launch of Project Vision, its 625,000 sq ft ambient national distribution centre at Scunthorpe.
Given that the warehouse was one of its most ambitious projects to date, serving a total of 3,100 stores, teething problems were inevitable. But, even before it was finished, a row erupted when Nisa-Today’s asked suppliers to put off sending invoices for goods delivered to the site until November.
The saga kicked off on the weekend of October 28-30, when the company’s management team faced the mammoth task of shifting 2.3 million cases of stock into the new depot - in a bid to consolidate the two existing depots at the site into one building.
“With the benefit of hindsight, we should have taken more time over the move,” says group commercial MD Neil Turton.
He points to the Hallowe’en gremlins that got into the warehouse management software on October 31, knocking the delivery schedule back by a day so that retailers received their first orders three days after making them, rather than two.
“The problems lay in the bit of the system that splits the depot into different areas for order picking,” says Turton, explaining for the first time in detail what went wrong. That, in turn, caused difficulties organising goods to be loaded on to trucks for delivery at the goods out stage.
Things soon snowballed. Retailers began to panic as they became aware of the situation and the company was swamped with orders for ambient goods to make up for gaps in stock, with the rapid onset of Christmas looming large in their minds. Discrepancies between deliveries to and from the warehouse grew as the schedule was thrown, leading to some retailers complaining they were short of almost 20% of what they had requested. The warehouse crew were playing an increasingly desperate game of catch up.
“At one stage we thought, ‘bloody hell, we’ve got a real crisis here’,” says Turton. Nisa-Today’s management team met for a council of war at 6.30am on Saturday, November 19. “We needed time to think things through without phones ringing.”
The team faced a grim choice. They could shut down the warehouse completely until they were back on track. Or they could issue a call for all hands on deck and work around the clock to claw back lost ground.
Complete shutdown would have caused worse stock shortages for retailers, says Turton, adding that the surge in demand after the depot was reopened would have created yet more problems. So, instead, they elected to keep the warehouse running and turn the situation around at the same time.
The management team met warehouse bosses and mucked in with staff on the floor picking orders to make up the backlog.
Managers directly involved in Project Vision, who had been working seven days a week since its launch, often did not go home until two or three in the morning, surviving on just a few hours sleep.
Turton confesses that, like many of his colleagues, he was living on takeaway meals at the office. “My wife joked that it looked like I was having an affair,” he quips. “I had to show her copies of The Grocer to convey what was happening.”
Giving up their personal time was not the only sacrifice. Slapping restrictions on orders to help workers keep pace with demand was another tough decision. Turton himself bravely posted his mobile number on Nisa-Today’s web site as the major contact point for retailers. That way, he explains, he could act as a buffer, protecting warehouse staff from being disturbed while they focused on the task in hand. Even the office Christmas party was postponed until January 13 while the issue was being resolved.
Regular updates on the state of play were e-mailed to retailers and flagged up on the internet and in Nisa-Today’s Consortium magazine. The depot played host to 40 delegates from the company’s core retail customers, who were shown around to highlight exactly how things were being tackled. Nisa-Today’s also opted for a policy of transparency with the trade press.
In addition, posters were sent to all the retailers it supplied, confessing that the blame lay with Nisa-Today’s, not shopkeepers, and asking customers to bear with them.
The strategy began to pay off. There was no room for damaging rumour or misunderstanding and Nisa-Today’s was careful to communicate every stage to members so they could see exactly what was happening.
Nisa-Today’s insistence that everything was under control began to win members over. In fact, many pitched in to help, with Costcutter volunteering its entire sales force to inform retailers of allocation amounts.
The tide turned after the first week in December, when delivery schedules began to revert to normal.
Nisa-Today’s is also gearing up for its most radical promotional blitz ever after Easter to make things up to retailers and help woo lost customers back to stores.
And a positively received annual general meeting last month has done much to further assuage members’ concerns. At the meeting, it underscored its commitment to its independent customers by resolving to change its articles of association to exclude supermarkets such as Sainsbury and Somerfield from holding shares.
While it says it is confident that the issue will be swiftly resolved, the setback will inevitably raise questions about what this year holds in store.
But after the tumultuous events of 2005, the Nisa-Today’s team must surely be feeling that things can only get better.
2005: a year of pain
>>Timeline of Nisa-Today’s annus horribilis
March/April: Dispute with chilled and frozen suppliers over cutting cost of goods
May: Launches Day-Today fascia scheme for retailers in Scotland
July: Brings in dual branding with retailers and unveils plans to trial multi-temperature deliveries. Dispute with some wholesale members over subscription fees. Rumours circulate that chairman Dudley Ramsden is negotiating for more money and power
August: Dispute with suppliers over demands to delay invoices for deliveries to Scunthorpe ambient warehouse
September: Unveils New Era trading terms for retail members at annual conference
October: Somerfield chairman John von Spreckelsen expresses unease over relationship with Nisa-Today’s in letter leaked to national press. Rumours circulate that he is to take over from Dudley Ramsden as chairman
November: Crisis hits new Scunthorpe ambient distribution centre
December: Resolution at agm disallowing multiple retailers from membership
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