Technical enhancements: Manufacturers improving inventory management, customer service with RFID

-- Manufacturing Business Technology, 1/14/2008 10:58:00 AM

Companies ranging from dairy products suppliers to athletic apparel makers are starting to realize tangible business benefits from RFID technology.

Daisy Brand, a Dallas-based supplier of cultured dairy products such as sour cream and cottage cheese, is using RFID to ensure that it ships the right items to the right locations in its distribution network. The technology also ensures that the product is fresh when it reaches the customer.

Meanwhile, Boston-based New Balance is 99.5-percent sure of where each item in its supply chain is located at any given time thanks to RFID.

"There is value and ROI with RFID," says Kevin Brown, director of information systems for Daisy Brand. "We're taking what we have learned from the RFID data to derive value and provide business insight to what supply chain events occur, and when. Daisy's use of RFID also improved customer satisfaction."

Daisy Brand's RFID solutions include:

• Forklifts outfitted with RFID readers from Alien Technology; and

• Tablet computers used in conjunction with an iMotion Edgeware RFID middleware platform provided by GlobeRanger.

The readers capture the EPC numbers of Alien's Omni-Squiggle Gen2 tags attached to pallets. Data from forklift readers and fixed readers are routed into Daisy's ERP system for immediate information access from the company's factory and warehouse in Garland, Texas.

"RFID technology allows companies such as Daisy Brand to improve real-time tracking of products, expiration dates, and unique location," says Ronny Haraldsvik, VP of marketing and industry relations at Alien Technology. "Daisy is a great example of a dairy producer and distributor making use of RFID within the supply chain to improve its own inventory tracking and derive business benefits accordingly."

Data about the product on a tagged pallet, including its type (non-fat versus regular sour cream, for example) and sell-by date also is stored in the company's ERP system. When a truck arrives to pick up a load, the system will let that driver know if he is picking up the proper pallet. For example, a pallet containing cases of product with an imminent sell-by date would not be shipped to a far-away retail destination. The reader at the portal will also alert a driver on his tablet PC if he is loading the wrong pallet for a specific truck.

New Balance is taking the use of RFID to a more granular level, tracking individual items as they travel through the supply chain.

The New Balance implementation consists of:

• The TrueVUE RFID software platform from Vue Technology;

• RFID tags from Avery Dennison Retail Information Services; and

• Handheld and fixed RFID readers and antennas from Motorola Enterprise Mobility.

"Our goal was to gain improved visibility into item-level inventory levels at every step along the supply chain—from the distribution center to the store backroom and all the way to the retail shelf," says Jim Tompkins, president and COO of New Balance. "The solution deployed by Vue Technology, Motorola, and Avery Dennison helped us achieve greater than 99.5-percent item-level accuracy. As we continue forward into the next phases, we expect this visibility to enable reductions in receiving and replenishment labor costs, reductions in inventory levels, and reduced stockroom retrievals."

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