Handleman Deploys RFID for Supply-Chain, Internal Benefits

By Beth Bacheldor

Aug. 9, 2007—Entertainment distributor and category manager Handleman Co. is building item-level RFID functionality into its operations so it can provide faster, more transparent and more intelligent supply-chain services to its customers and suppliers.

"We are a distributor and category manager that sits in the middle, between labels, studios, publishers and retailers," says Khaled Haram, Handleman's senior VP and CIO. Handleman is a $1.3 billion-a-year distributor and category manager of CDs, console video games and other products to retailers in the United States, United Kingdom and Canada. "We have the ability to transform any commodity-based service to a premium value-added service through technology, by applying visibility, velocity and intelligence to that service. Handleman Company has developed a series of systems and programs that captures and manages information on individual items through the use of RFID technology."

Handleman began developing enhanced tagging on individual items before Wal-Mart issued RFID tagging requirements (see Movie, Music Suppliers Opt for Simple RFID Compliance). The company also participated in a U.K.-government initiative designed to test RFID's ability to help prevent CD counterfeiting (see CD Tracking Project Deemed A Hit). Recently, the company began to expand and market its unique systems and programs that utilize RFID. This includes integrating RFID tags into its high-speed shipping lines within its distribution facilities.

Now, Handleman has installed an RFID printer-encoder and applicator on a shipping line in its Indianapolis distribution center, which automatically tags individual CDs, console video games and some promotional items (bundles, packs and so forth) as they move down conveyor belts.

The system automatically associates the unique ID number in the RFID tag with an item's Universal Product Code (UPC). The company's electronic resource planning (ERP) system, which handles purchase orders, is integrated with program logic controllers on the shipping line. When a purchase order requiring RFID-tagged products is filed, the ERP set-up instructs the system to apply tags to the appropriate products, with no human involvement.

As items are placed in their respective cartons, the system creates the proper item-to-carton associations and generates advance shipping notices (ASNs)—formatted and configured to each retailer's specifications—that include each item's unique ID number, or Global Trade Identification Number (GTIN), and the associated UPC, as well as the number of items in each case and the case's UPC code and GTIN. To give suppliers and retailers visibility to the items in the supply chain, Handleman has also developed a Web-based portal that its customers can access to check the status of their shipments.