Drinks logistics firm Tradeteam is making a multimillion-pound investment in a warehouse management system for its 40 UK warehouses over the next two years.

The company, a joint venture between brewer Coors and supply chain management provider Exel, hopes to use the software to improve stock control, support business growth and improve its profit margins.

'The system will enable us to make the best use of warehouse volume, and enable much better control over the receipt, management and issue of stock,' said Tradeteam IS support services manager Jim Davies.

The distributor currently has to reserve different areas of its warehouses for each customer, which leads to a lot of floor space wastage. The new system will allow more efficient use of the available space and help the company minimise stock losses.

'It's critical for letting us manage our business more efficiently, and therefore more profitably,' said Davies.

The company plans to roll out the new system over the next two years, having completed an initial test run in one location last July.

This year, it expanded the trial to other warehouses to track wines and spirits, which have a higher value per square metre than beer and provide higher financial returns.

'It will become a major feature in our offering to our customers,' said Davies.

An automated warehouse management system will also support the future rollout of new technologies such as radio frequency identity (RFID) tagging.

Davies says this is likely to happen in time, although he says customers have been slow in picking up the technology.

'We have to get our warehouse management system in place first, because you couldn't roll out an automated stock tagging system without that,' he said.

Tradeteam makes about 50,000 deliveries a week, moving millions of barrels across the UK every year.

Last year, the company also signed a two-year outsourcing contract with IT services firm Computacenter for the management of its server administration and desktop support.