Briscoe's Drury warehouse: why the paper came out before the robots

Briscoe Group's automated distribution centre at Drury, South Auckland, made the trade press this week on the strength of its pick rates and shuttle system. The more useful detail for most NZ businesses comes from the start of the project. When consultancy Argon & Co was engaged, Briscoes had no warehouse management system (WMS), picking ran from paper and distribution relied on a basic SAP bolt-on. The automation came last, after years of work on systems and stock flow.

What happened

Between 5 and 6 November, ChannelLife, iTWire and techpartner.news published details of the overhaul. The problem Briscoe set out to fix was misplaced stock. Rebel Sport's on-shelf availability sat below target even though the group held plenty of inventory across its stores.

The new model holds more stock centrally and releases it against demand. Briscoes Homeware used to send 80% of incoming product straight to stores, and that share is 20% under the new model. Pallet storage has grown from about 4,000 to 15,000 positions. The building itself is a 25,000 sqm site replacing an 8,000 sqm facility, at a cost of at least NZ$100 million.

On the evening of 5 November, Briscoe's third-quarter update to NZX added the financial side. The group expects full-year net profit of up to $55 million, and says the centre's automation is still progressing towards full commissioning.

The order of the work

Reseller News reports a two-year WMS rollout in three phases. The Manhattan Associates system went into Briscoe's existing warehouse, then went live on manual operations, then moved to fully automated end-to-end running. Briscoe's stated reason in 2024 was to give staff time to build skills on the WMS before moving to the new centre.

The sequence meant warehouse staff had learnt the new system before the KNAPP shuttles arrived. Fault-finding on a live automated site is much harder when the operators are also learning the software that directs it.

Procurement took similar care. About 10 suppliers answered the initial expression of interest, and a formal RFP cut the field to five. The hardest technical work sat in the software. "Integration into the SAP system was probably the biggest challenge," Argon & Co partner Jeff Triantafilo told Reseller News. The team couldn't always predict how joining data sources would affect other systems, and functional and user acceptance testing is what resolved those issues.

Read the early numbers carefully

Automation averaged about 237 picks per hour in its first weeks against a target of 300, with one operating period reaching 446. The average works out at 79% of target, which is a fair showing for a new system. The peak shows what the equipment can do, and the published figures don't say how long that period lasted or what mix of orders it handled. We'd treat the average as the planning number.

Most of the headline inventory figures are targets. They include store inventory reductions of 57% for Briscoes Homeware and 67% for Rebel Sport, Rebel Sport cover falling from 18 weeks to six, and imported stock turns rising from 2.49 to 3.0. The operating figures come from the project's own participants, and achieved results against those targets haven't been published yet.

The financial timing deserves the most attention from anyone writing a business case. Briscoe's first half carried $1.9 million of extra operating costs for the centre and $0.9 million of one-off SAP S/4HANA upgrade spending, partly offset by a $2.0 million lease benefit. The group now expects the benefits to become increasingly evident during the 2027/28 financial year. Briscoe was already well into its WMS implementation in April 2024, so the gap between early spending and visible payback runs to about three years. Costs arrived well ahead of returns, and a well-funded listed retailer can absorb that gap more easily than a smaller firm.

What it means for NZ businesses

Few NZ firms will spend $100 million on a warehouse, but plenty of importers, distributors and manufacturers run stock on paper or on an ERP add-on. Their position looks a lot like Briscoe's starting point. A shuttle system or a pick robot depends on knowing exactly where each unit sits, and paper processes can't supply that record reliably. Buying automation first would put an expensive machine on top of data nobody trusts.

The stock model carries a risk of its own. Moving from direct-to-store delivery to central release concentrates inventory decisions in forecasting and replenishment rules, so weak forecasts will send the wrong product out more efficiently. Briscoe's project treated replenishment as part of the design, which Triantafilo described as only partly about the building.

Online orders add pressure on the same stock pool. Briscoe's online sales reached 19.17% of group sales last quarter, and the Drury platform routes those orders to dedicated packing stations. Firms that run store and online stock separately should settle that question before choosing a warehouse system.

Briscoe is also upgrading to SAP S/4HANA in the same year as commissioning. The company hasn't published how the two programmes interact, but any firm facing an ERP upgrade should plan warehouse integration alongside it. Our ERP team's advice on that point is to agree the order of the two projects before signing either contract.

Practical next steps

• Measure where your stock sits against where it sells, by site and by top supplier. Briscoe's case began with availability data, and that baseline will tell you whether you have a volume problem or a placement problem.
• Test whether your ERP's warehouse module can hold accurate bin-level locations. If staff still rely on paper or memory, a WMS or a fuller ERP module comes before any automation quote.
• Roll out in phases on your existing site, and run manual operations on the new system before adding equipment.
• List every interface between the warehouse system and ERP, name an owner for each data source, and budget real time for user acceptance testing.
• Model ramp-up at about 80% of target rate, and carry double-running costs in the business case until payback is visible in the accounts.
• Check forecast accuracy by product line before moving stock to demand-led release.
• Agree the metrics you'll report after go-live, so results can be compared with the original targets.

Firms weighing a change like this can start with our digital transformation guide, which covers planning and common barriers.