By Leow Si Wan

NTUC FairPrice group posted annual sales of $2 billion in the financial year ending March 31 - 10 per cent up from the previous year's figure of $1.81 billion.

The supermarket chain is also expanding and hiring - five new stores are opening this year and 300 new workers have been employed, with 200 positions still to be filled for the latter part of the year.

To deal with its business and expansion plans over the next five years, FairPrice has invested $41 million in developing the capabilities of its central distribution centre in Joo Koon, which handles 80 per cent of all its dry groceries.

FairPrice group chief executive officer Tan Kian Chew said: 'We started our centralised distribution system in 1993 with the primary objective of eliminating inefficiencies and raising productivity, so that cost savings can be passed on to our customers in terms of lower prices.

'We have since upgraded and improved our system.'

The centre's high-speed automatic sorting system on a conveyor belt was officially unveiled yesterday.

The system can sort grocery items up to a rate of 7,200 cartons an hour or two cartons a second, and can handle up to 20kg for each carton of grocery items of various sizes.

Mr Dickson Yeo, NTUC FairPrice's director of supply chain, added that this is twice the speed of conventional sorting systems.

The state-of-the-art system, believed to be the first of its kind for grocery distribution in the Asean region, is expected to increase productivity by 50 per cent and double the volume of grocery items handled each day. On average, the centre currently handles about 53,000 cartons of grocery items daily.

The automated system is also able to sort items faster and more accurately, shortening working hours by about 3.5 hours every day so that employees can go home earlier.

'Distribution used to be very troublesome and highly time-consuming. There was often wastage,' Mr Tan said.

'Now, the supply chain is shortened and the double-handling of products is minimised. All these mean big savings which we can pass on to suppliers and consumers.'

At optimal capacity, he added, the automated distribution system can potentially bring in savings of $1.4 million in operating costs yearly.

This article was first published in The Straits Times.