Managing Automation - May 2008 - (Page 42)

[ INDUSTRIES ] Transformation Integration TechWatch play its suppliers to tag the cases they put on pallets, and then the individual products as well — the dreaded item-level tagging that few industries have undertaken to date. By Oct. 31, 2010, supplier shipments to any Sam’s Club distribution center will have to contain item-level RFID tags in addition to case and pallet labels. Executives at Sam’s Club are quick to emphasize that their RFID initiative is separate from the plan introduced by the company’s corporate parent, Wal-Mart. That insistence may stem from the fact that HOW TO GET STARTED A host of RFID companies have created Wal-Mart’s RFID program basic offerings to cover manufacturers’ for suppliers has been long retail compliance needs. Here is a sampling on ambition but short on enof companies and their products: forcement. “Most of the companies I Acsis, Inc.’s ProducTrak Compliance Edition talk to are now tagging www.managingautomation.com/acsis2 three or four SKUs” for Walwww.acsisinc.com Mar t, says Steve Banker, Domino Integrated Solutions Group’s director of supply chain Compliance 1st kit management research at www.managingautomation.com/Domino ARC Advisor y Group. “As www.domino-eis.com long as suppliers are willing epcSolutions Inc.’s RFIDTagManager to show Wal-Mar t that www.managingautomation.com/epc they’re tr ying new things, www.epcsolutions.com that they’re tr ying to get ILS Starter/Pilot Kits ROI but they haven’t gotten www.managingautomation.com/ils www.ilsrfid.com it yet, they’ve been able to keep this down to a pretty Lowry Computer Products’ Quick Comply Kits small program.” www.managingautomation.com/lowry Don’t expect the same www.lowrycomputer.com largesse from Sam’s Club, NCR Retail RFID Compliance Kit says one product manager www.managingautomation.com/ncr at a company that makes www.ncr.com RFID compliance kits. OATSystems’ tag@source “They’re starting to run rewww.managingautomation.com/oatsystems ports now, so they’re going www.oatsystems.com to star t fining,” says the SATO’s Ready-Set-Solved! Compliance manager, who until recently application worked at Wal-Mar t and www.managingautomation.com/sato www.satoamerica.com asked not to be identified by name. Xterprise’s Automated RFID Module (SaaS-based label printing) “I’m not sure they’re gowww.managingautomation.com/xterprise ing to back off so much this www.xterprise.com time,” agrees Pete Poorman, principal analyst for Other provider options include third-party logisRFID at ABI Research. tics companies, which can affix RFID tags during the transit process, and warehouse management Poorman portrays the prosoftware packages, some of which have RFID gram as the “normal course capabilities built-in. of business” for Sam’s Club and its suppliers. “It’s just what you have to do,” he says. Even so, Sam’s Club is jittery about appearing too strong-handed. “Industry has been referring Industries to this as a mandate and chargebacks,” says company spokeswoman Susan Koehler. Instead, she says, the tagging fees are “an interim service until [suppliers] can develop their own strategies.” SO, WHAT’S YOUR STRATEGY? Finland-based Huhtamaki isn’t waiting around to find out whether Sam’s Club’s RFID program is a paper tiger. The maker of the Chinet line of disposable plates and dinnerware added RFID to its production operation earlier this year to meet the retailer’s requests. Tasked with adding RFID labels to “a couple dozen SKUs” manufactured in plants in Phoenix; Sacramento, CA; and Albertville, AL, Huhtamaki’s IT project manager, Mark Pettigrew, turned to NCR’s RFID Retail Compliance kit. Better known for its point-of-sale terminals outside the manufacturing realm, NCR entered the RFID business in 2006 through its acquisition of ID Velocity. NCR’s kit includes the company’s TransitionWorks for Retail RFID compliance software, a Zebra RFID label printer, a tethered scanner, and Gen2 RFID labels. Donna Wright, NCR’s vice president of AIDC Solutions, acknowledges that NCR won’t be the only RFID provider filling the Sam’s Club compliance niche. “You’re just going to see all kinds of little companies that are competitive to NCR solutions come out and say, ‘We support this.’ ” (See box at left for other compliance kit offerings.) Back at Huhtamaki, Pettigrew was forced to toe the line that many consumer goods companies face as he implemented the NCR system: figuring out a way to juggle the RFID mandates of both Wal-Mar t and Sam’s Club. Although Huhtamaki has not been asked to participate in Wal-Mart’s program, Pettigrew says the company is installing RFID with the parent company’s mandate in mind. For instance, the manufacturer does not need to send Sam’s Club an advanced shipping notice (ASN) with RFID identifiers because it is shipping only homogeneous pallets of goods. Shipments to Wal-Mart, however, would include mixed pallets, so Huhtamaki would need the ASN capability. In a nod to what may come, the company has incorporated the function into its system. Compliance with Sam’s Club’s requirements has been a manageable cost, Pettigrew says. The three NCR compliance kits (one per plant) cost approximately $15,000 each, and the associated consulting bill from NCR topped out at $40,000. He says the initiative has not provided Huhtamaki with a discer nible retur n; the slap-and-ship operation is purely a cost of do- list ma May 42 2008 http://www.managingautomation.com/acsis2 http://www.acsisinc.com http://www.managingautomation.com/Domino http://www.domino-eis.com http://www.managingautomation.com/epc http://www.epcsolutions.com http://www.managingautomation.com/ils http://www.ilsrfid.com http://www.managingautomation.com/lowry http://www.lowrycomputer.com http://www.managingautomation.com/ncr http://www.ncr.com http://www.managingautomation.com/oatsystems http://www.oatsystems.com http://www.managingautomation.com/sato http://www.satoamerica.com http://www.managingautomation.com/xterprise http://www.xterprise.com

Table of Contents Feed for the Digital Edition of Managing Automation - May 2008

Managing Automation - May 2008 Contents Take 1 Award-Winning Shoe-Maker Otabo Alters Course, Shifts Production to China IBM Partners with Universities for Cloud Computing Getting Noise in Production Under Control Incuity Embarks on a Vertical Market Strategy Foundation Intensifies OPC Standard Testing Mailbox Notes PM Roundtable Cover Story: The Business of Going Green Special Report: Night and Day Delivering on Promises Finding the Right Fit for Wireless Driving RFID Product Scan Advertiser Index Next

Managing Automation - May 2008

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