Canadaigua Wine Operations

Introduction

Canandaigua Wines is located in Canandaigua, NY and is a maker of over 20 brands of valued priced wines that are distributed throughout the United States and abroad. Its goal is to provide its customers with an affordable product that can be consumed in everyday life. Canandaigua Wines operates two local wineries, the facility in Canandaigua which we visited and Widmer's Wine Cellar in Naples, NY, which is a popular wine tour destination. Some of Canandaigua Wines brands include wines, brandy, sparkling wine, and premium wines with two popular brand names being Arbor Mist and Wild Irish Rose, which are both bottled at the Canandaigua facility. In 2004 Canandaigua Wines became part of the largest wine company in the world, Constellation Brands Inc. Constellation Brands is a large, publicly traded company with its headquarters in Fairport, NY. Even though it is owned by Constellation, Canandaigua Wines operates as an independent entity.

Flow of Operations

The Canandaigua Wine manufacturing facility is typical of a mass production style of operation. The production process moves from one area to the next, starting with the juice tanks, moving to the bottling and boxing area, and finally ending in the inventory warehouse. Production is handled by workers that perform routing tasks such as loading boxes or quality control. There are special work divisions that handle flavor changes, repairs, and bottle size changes. The production of a bottled wine product is less complicated than that of an automobile this provides a higher level of automation and the appearance that the company employs very few employees. Based on a rough estimate there seems to be about 50 employees on the production or bottling floor at one time during the day. According to the average daily production figures this would mean that for every 1 employee 1000 cases of wine or 9000 normal sized wine bottles are produced per day. The typical (on an average day) operational flow of the wine manufacturing process at Canandaigua wines can be broken down into four components:

1. Juice holding tanks

2. Fermentation - The juices are pumped into takes for fermentation.

3. Bottling Lines - After a fermentation period the wine is ready to be pumped to a bottling line where it is bottled, capped, labeled, wrapped (foil) and boxed.

4. Inventory/Storage - A conveyor

belt caries the boxes or cases to be palletized and moved into storage.

Additionally, once a year, over a two week period, grapes come from local growers for Grape Pressing.

Grape Pressing

Growers from all over the region, all of whom are within a three hour drive, are given a schedule of delivery for their grapes. These grapes are dumped into a sorter/separator which separates the grapes form the leaves and stems. The grapes are then pressed and the juice is separated from the skins and seeds. The seeds are sorted and saved (shipped to another company). If the grapes being pressed are to be used for a red wine a Hot Press is used. The Hot press extracts the color from the grapes skins by pressing the grapes at 140 degrees Fahrenheit. The juice is pumped into one of several tanks for storage. The leftover skins and pumas are put through a drum vacuum filter which sucks all the sediments to the surface, creating a thin film on the face of the drum thereby leaving salvageable juice that is pumped to the holding tanks as well (see Drum Vacuum Picture in Appendix).

1. Juice Holding Tanks

These tanks are very large, each looking similar in size to a local water tower giving the appearance that these tanks could easily turn the entire water supply of Canandaigua into juice (see Juice Tanks Pictures in Appendix). The juices in these tanks are used for the entire wine production year. Preservatives are therefore added to the juice to ensure that the juice doesn't spoil.

2. Fermentation

Depending on the wine type to be produced, the juice has to be fermented for various amounts of time. The wine produced at the Canandaigua Facility is a "value priced" wine therefore most fermentation periods are two weeks or less. The fermentation process for Champaign can take a month due to a two to three week fermentation and carbonation process and a week flavor adding process. There are nine tanks that hold the still or non-carbonated wine each tank is over 50 feet tall, most are stainless steal. The Winery still uses several large wooden tanks (see Wooden Tank Picture in Appendix), however these tanks are being phased out due to their high cleaning and operation costs. Today, theses large wooden tanks are mostly used for making cooking wines.

3. Bottling Lines

There are nine bottling lines that Canandaigua Wines operates (see Bottling Line Picture in Appendix). Each line is capable of handling various sizes of bottles including 1.5liters 1.87 liters and 3.75 liters. There is a line that fills flask sized bottles (750ml). Some lines are older than others and are therefore less productive. On average these lines can produce 40 to 50 thousand cases a day. Each case can holds about nine liters. These lines have the flexibility to change bottle sizes, change flavors, and operate at various speeds. The Arbor Mist line of product comes in several different flavors. It is therefore important to have a quick flavor change rate on the Arbor Mist lines. This change over happens at lunch time or during shift changes and takes approximately 1 hour. A special sanitization crew handles the flavor changes. A mechanics crew handles the bottle size change over. This process can take over 18 hours and is usually allotted a full 24 hours. This lengthy time period makes the bottling operation less flexible and adds importance to the scheduling of wine bottling based on bottle size needed.

4. Inventory/Storage

After the wine is bottled it is sent to a storage facility to await pick up from 3rd party transportation as well as company owned transportation. On average Canandaigua Wines has 200,000 cases in inventory. The warehouse is operated on a first in first out basis managed by the company's ERP system.

Customer and Supplier Relations

One of the most important factors of Canandaigua Wines winemaking process is its relationship with its grape suppliers. Constellation owns 810 acres of grape fields in the area, but most of Canandaigua Wines grape supply is from approximately 80 to 100 private growers.