Imperial Tobacco has invested 255 million hryvnias in the opening of the biggest Ukrainian automated High Bay Warehouse


Imperial Tobacco has launched the largest automated High Bay Warehouse in Ukraine. The total volume of investments for this project amounted to 255 million hryvnias.

The warehouse with a capacity of 16.2 thousand pallet-places is located on the production site of the company in the city of Kyiv; it makes it possible to automate completely the material flows of the tobacco factory of Imperial Tobacco Production Ukraine JSC and to carry out logistics services right at the enterprise.

The opening of the automated High Bay Warehouse will allow the tobacco factory of Imperial Tobacco Production Ukraine JSC to improve significantly the efficiency of the enterprise logistics, and to reduce thoroughly the time of the finished product delivery to the distributors both in Ukraine and abroad. In spite of the large investments, the opening of such a warehouse means independence from the service providers regarding rental payments – those heads of expenditure, which increase annually, therefore putting the warehouse into operation allows significant reduction in operating costs due to refusal of services of outside contractors.

During the years of existence of Imperial Tobacco Production Ukraine, the investments were made only in the infrastructure of the factory, namely: in the production premises and facilities, while the warehouse area only decreased. From the year 2010, the factory of Imperial Tobacco Production Ukraine was compelled to use the services of external logistics because of the insufficient storage space in their own warehouses. The new automated High Bay Warehouse will provide the opportunity to refuse the services of the contractors and ensure the logistic services for the production facilities directly in the territory of the factory. On condition of uninterrupted operation, the new warehouse will allow processing simultaneously 2130 pallets per day, including shipment of 1050 pallets of finished products for the local market, 270 pallets - for export markets, and acceptance of 810 pallets of the tobacco and non-tobacco materials necessary for the manufacturing process of the enterprise every day.

The automated 12-level warehouse of Imperial Tobacco Production Ukraine JSC is an innovative, completely automated object, which functions practically without any human intervention. All warehouse operations are controlled by a modern warehouse management system integrated with the ERP software of the factory, while the work inside the warehouse is performed by special "robots" – the stacker cranes and the conveyor systems for the pallet transportation. In other words, the new automated High Bay Warehouse of the tobacco factory is a large-scale and innovative logistics facility, which has no analogues in Ukraine in terms of storage capacity, productivity indicators, and the warehouse management system. The modern technology, which formed the basis of the automated High Bay Warehouse of Imperial Tobacco Production Ukraine JSC, provide an opportunity to implement major logistics tasks of the tobacco factory in the 24/7 mode clearly and accurately, namely: the reception of the materials and the freights, uniform storage at all levels of the warehouse and shipping of the finished products.

Nevertheless, even under conditions of complete automation of the object, 10 new workplaces were created, and they are the permanent jobs for the staff of the factory. At the same time, in order to remain effective in terms of the expenditures connected with the resources, the factory continues to use the services of the provider, which provides non-permanent personnel (drivers of loaders) depending on the company requirements. This flexibility cannot be reached having permanent staff of your own.

The opening of the automated High Bay Warehouse is, first of all, a step towards new technology, which implies correct storage of CMV (commodity and material valuables), high-precision processing of the freights in accordance with the FIFO (First In First Out), and FEFO (First Expired First Out), constant 100 per cent accounting, accurate functioning of the Track & Trace system tracking of the tobacco products movement in order to prevent their illegal trade.

On 24 April 2015, at the factory of Imperial Tobacco Production Ukraine JSC, ceremonial opening of the automated High Bay Warehouse took place.

Nikolay Penner, the tobacco factory Managing Director at Imperial Tobacco Production Ukraine JSC

‘Imperial Tobacco has launched the object – the automated High Bay Warehouse - which we can be proud of by right. Our company has implemented this project completely "from scratch": we built an object of capital construction in the territory of the factory, installed the equipment, introduced the advanced software and created some new workplaces.

We invested 255 million hryvnias in the implementation of this project, including 60 million hryvnias that were spent on the acquisition of the modern equipment and the development of the software. Considering the volume of investments, this amount has been one of the largest investments in the logistics segment of the market during the recent years.

Of course, against the background of economic crisis, growing tax pressure on the tobacco industry, and decrease in the volumes of legal manufacturing, we pondered over the suspension of the project but we, being a responsible business, implemented it. In anticipation of the positive changes from the announced reforms, we continue to believe in the potential of the market of our country.’