A need for better profit margins, a reduction in labour costs, reducing fire risk and bringing the company into the 21st century were all part of the reason Dulux decided to build a new paint plant in Merrifield, Victoria.
Being the number one paint manufacturer in Australia meant the company had to make sure none of its marketshare slipped while building the new factory. It helped that everybody was onboard, said project lead, Kevin Worrell.
“This new building was the biggest Capex spend we were going to do in its 100-year history,” he said. “The spend was going to be $165 million and we had no in-house large project experience. Most importantly, we were worried about the shareholder reaction. Shareholders really don’t see the need for a factory, they just see what is being spent. Unless it is getting returns, they get a bit worried. However, it was received well by the market when we announced it.”
But the issues that needed addressing didn’t stop there. Part of the brief was also about giving the production process flexibility due to the number of paint recipes and Stock Keeping Units (SKUs) the company has. Then there was the importance of speed in the production process.
“Anywhere else in the world, a factory of this size would probably only make white paint,” he said. “We have 150 recipes and about 1200 SKUs. It’s very complex. We also have about 70 raw materials that we have to put together.
“We wanted processes to be able to cope with moving new products through the factory quickly – from the lab to the consumer. And the board wanted a really short commissioning time. That was a key point for us all the way through our planning. We wanted an increase of productivity and performance within the factory over time, as well as a strong reliance on automation.”
A key ingredient to the build was to make sure it was future proofed. When there is a spend of more than $150 million, it is important that the capital investment is going to last a long time.
“Sometimes you can only leave space because you know in the future the area is going to be used,” said Worrell. “For example, inline printing for our can lines will be something we will do but we don’t know what it looks like at the moment.”
Another example of future proofing was the collaboration between Dulux and its providers. The prime example being its suppliers of latex, a key ingredient in the manufacture of paint.
“The technology of latex is changing all the time,” said Worrell. “We wanted to know what was coming next and five years out is about as far as we could see. We engaged with the companies that supply our latex and they looked at our mixers, and helped us decide how they would cope with our different types of latexes in the future.”
Interestingly, Worrell believes that a key ingredient in upgrading the plant was getting management on board. “Management are not stupid people but they do not go on these journeys very often,” he said.
“We needed to assume that they didn’t know what they are getting. Once it was all explained, they were on board.”
When it comes to decreasing the reliance on manual labour, transporting the various ingredients around the plant was the main consideration.
“The important thing about the high-volume plant is how the ingredients are transported to the mixers,” he said. “There are no big chemical reactions. We are mixing chemicals together and that gives us paint. But all our ingredients are transported to the mixers. That is the way the high-volume plant needs to be controlled. Up until now, it was done manually. Now we have better systems in place that don’t require manual input.”
Next on the wish list was the blending of the tint, which meant smaller batches to be prepared.
“Small batches will go down to about 100 litres – about half a pallet to two pallets,” said Worrell. “All different colours with different SKUs. It can run ‘lights out’ and is capable of one-off batches. We reckon we’ll even be able to make perfumed paint for Christmas smelling like pine needles. It is a pilot plant that is capable of 10 batches before it needs to fill off, with batch time being approximately 30 minutes, which is pretty quick.”
Materials handling became the next issue for the construction of the building. Dulux looked at the powders that go into paint. Because of its supply chains in Australia, Dulux can’t get powders in bulk; it has to order in tonne bags. This meant the construction of this part of the build was more an architectural exercise of laying the areas out and seeing how the company could go back into a digital world and monitor what was going on.
“A 30,000 litre mix might have 20 tonnes of powder,” said Worrell. “So we had staging areas that included dispersing it into a basement so the feed area was at ground level. We could then stage the 20 tonnes of powder, which would then be dropped in. If the wrong powder went in, we would stop it with the clamps at the top. It was still manually operated but pretty simple.
“Another change was that we brought in our calcium carbonate via tankers and pumps. We’d blow it into silos and then into day hoppers. Taking that off line has given us a 30 per cent efficiency. We’re now not running the dispersers anywhere near as much as we used to. This means we can get the dispersion happening a lot quicker.”
The biggest inroad into the company made from an Industry 4.0 point of view was how it handled mini-bulks. They typically came in 44-gallon drums that were stored on tank farms. Dulux wanted much more control over how the mini-bulks were handled so they wanted suppliers to provide the material in intermediate bulk containers (IBCs).
“We eliminated feed-out areas, which we had no control over,” said Worrell. “There were lots of mistakes made – spills and all sorts of terrible things happening in these areas. It’s not just the paint. It was across the board.
“We replaced it with a system of holding tanks that allowed the IBC to be drained into the tank and held in the tanks.
“As the factory demands from the different recipes feed off into the dispenser head, it is very accurate and gets down to the milligram of delivering the chemical to the plant.”
Another aspect that the company looked into was monitoring asset performance.
“With our asset monitoring we are already saving about 20-25 per cent on our power use,” said Worrell. “That is much better than we anticipated.”
The stage the plant is in at the moment is that it’s got to the end of its ramp up and Dulux is making about 800,000 litres a week. It probably needs to be at 1 million litres a week, according to Worrell.
Dulux had the workers available about two months before the plant went online. The company was able to put operators into a training situation where they were able to look at the plant using simulation.
“We were able to run intelligence and quality control together,” said Worrell. “We found we were getting too much water in some of our mixes and we were able to use some of the intelligence our plant was giving back to be able to work out where that was happening.
“We also found our recipes could be tightened up and that is going to be a saving for us. Our recipes are going to have a tighter band of application. We’ll see savings in materials. Also, instead of over-filling, which is what we generally do when filling off, we now get better accuracy.”
And what was the end result of all this digitisation of the new factory? Streamlined processes and lots of savings.
“We now have capacity over two shifts of producing 75 million litres per annum,” said Worrell. “It has a lights out potential. If we spend about another $30 million we can just about make the whole plant lights out, which would be extraordinary.
“The best thing about it all is that we made our first batch of paint within two weeks of construction finishing, which I think is a great achievement.”