SAP helps Taylors take fine wines to the world
To ensure it was well placed to maintain its momentum and improve customer service, this well-known and rapidly growing wine company needed a discerning technology partner...
Nestled in South Australia’s picturesque Clare Valley, Taylors Wines has been producing some of the country’s best vintages for more than 30 years.
Using grapes harvested from its own vineyards as well as bringing grapes in from outside growers, the company processes, bottles and distributes a range of wine styles to customers throughout Australia and around the world.
In late 2003, after enjoying a period of rapid growth, the company embarked on a review of its internal processes and capabilities.
Wanting to ensure it was well placed to maintain its momentum and improve service to customers, all areas of operations were examined.
Taylors Wines Chief Financial Officer Tim Warren said the review identified a number of areas in which improvements were needed. IT systems, that had served the company well in the past, were groaning under the strain of higher order numbers and changing client demands.
“We found that we did not have the level of internal controls or processes that we needed moving forward,” said Warren. “As our industry was becoming more competitive and our production growing, we realised it was time to make some significant changes.”
Areas requiring specific attention included pricing controls, order processing, production and distribution capabilities and reporting. With customers varying in size from large supermarket chains to small, one-person liquor stores, system flexibility and reliability was paramount.
“We were very reliant on our telephone operators being familiar with all customer pricing details. While this had worked well in the past, as we grew it was becoming more difficult to ensure consistency.”
The review had also identified weaknesses with the company’s accounting system. Installed in 1994, the application had worked well but was now unable to support the rising transaction traffic. Taylors presently has more than 1500 clients generating in excess of 16,000 transactions each year.
“There was also a need to increase our cost centres from six to more than 40 to allow for more accurate internal reporting and forecasting. Without this level of detail you can end up making assumptions and that can become dangerous.”
In early 2004, a comprehensive system specification was developed and submitted to a range of potential software suppliers. From an initial list of nine, and following a comprehensive review process, SAP’s Business One was selected.
“We needed a system that could support every aspect of our business, from manufacturing and order processing to distribution and accounting. SAP was able to deliver on all points,” said Warren.
After the final decision in August, Taylors worked with SAP and integration partner Evolution Software Services to implement the new system. The first step was a comprehensive study of the company’s business processes, followed by the start of the roll-out program in September. By December the first phase had been completed and SAP Business One went live in the first of the company’s five distribution centres.
Warren said that, after monitoring the initial performance and accuracy of SAP Business One, usage was then extended to other areas of the company, culminating in the legacy systems being turned off on February 1.
“We were able to achieve this so quickly because SAP software is a very logical and user-friendly system. We did not have to change internal systems to suit the software.”
On March 1, Taylors Wines introduced the SAP Production Model, which covers packaging requirements for the business. The comprehensive nature of the solution, particularly in the area of controls, will provide Taylors Wines with detailed information about production schedules which should ultimately flow through to the bottom line.
Because Taylors’ headquarters is in Sydney, the SAP Business One system has been implemented there with Clare Valley staff accessing it remotely via a satellite link.
This centralised approach allows the company to have a clear, up-to-date picture of operations at all times.
Warren said that, where it would once have taken a couple of days to get an accurate picture of the amount of stock on hand at all distribution centres, this was now available instantly. Other advantages have included a more streamlined order fulfilment system, improved invoicing and customer records, and better internal financial reporting.
“There were some minor issues during the roll-out but nothing that we weren’t able to fix quickly. One of my objectives for this process was that our customers would not know that we had changed anything. I believe we achieved that.”
“We could have spent a lot more money on other systems and I don’t think we would have got the same value out of it,” he said. “We are now very well placed to cope with future growth.”
“SAP has indicated it is willing to work closely with the wine industry on how its application modules can be used in the production process and this is something we are keen to do,” he said.
Other areas in which SAP Business One would be used in the future included the establishment of EDI (Electronic Data Interchange) facilities, MRP (Materials Requirements Planning) and sales force automation.
Taylors Wines is now confident it has a software platform in place that will continue to support its growth well into the next decade.
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