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Daisy Brand Expands RFID Use, Asserts ROI

Dairy food producer Daisy Brand began using RFID to comply with Wal-Mart's requirements, but now applies RFID labels to every pallet because multiple enterprise systems depend on RFID data. The company says expanded RFID use has provided positive return on investment and many business benefits.
Jan 16, 2008This article was originally published by RFID Update.

January 16, 2008—Daisy Brand, one of the first consumer products makers to voluntarily include RFID tags on shipments, recently announced it has installed its third-generation system and now uses RFID for all internal pallet tracking at both of its production/distribution facilities. Kevin Brown, vice president of information systems at Daisy Brand, told RFID Update the Dallas, Texas-based provider of sour cream and cottage cheese gets internal benefit and ROI from its systems and now puts RFID tags on each pallet it ships, even if customers do not require RFID tagging.

"Our warehouse management system, transportation management system, inventory, and customer service are all driven off the data from RFID tags on pallets," Brown said. "We've got much better traceability than we had before RFID. We can easily track everything by lot and expiration date."

Daisy Brand first began investigating RFID in 2004 and was tagging pallets bound for Wal-Mart distribution centers by January 2005. The company was one of about 30 that volunteered to meet its Wal-Mart tagging requirements early and join the first wave of adoption. Since then Daisy Brand installed RFID systems at both of its production and distribution facilities (in Garland, Texas, and Casa Grande, Arizona), expanded its use of RFID for internal applications, and has started applying RFID tags at the case level for shipments to Wal-Mart.

The company recently installed its third-generation system with new ALR9900 Gen2 UHF readers from Alien Technology, who made the announcement. Daisy Brand uses a mixture of portal and forklift-mounted readers at its facilities. Data from RFID readers is aggregated and processed with GlobeRanger's iMotion Edgeware middleware platform, which is integrated with Daisy Brand's internal business systems. Daisy Brand has created a website that customers can use to check order and invoice status. The site includes information that is updated in real-time from the RFID system.

The internal RFID applications have provided ROI by improving customer satisfaction and providing visibility that leads to improved stock management, Brown said. For example, Daisy Brand closely monitors the expiration dates of its products and has the timely information necessary to proactively manage inventory to help products sell before their sell-by date.

Daisy Brand also uses the data and inventory visibility it receives from Wal-Mart to monitor the retailer's execution of promotions. Daisy Brand can see if products and displays are being moved to the selling floor on schedule, and analyze how promotions impact sales.

"We are seeing some value in addition to reduced out-of-stocks," Brown said. "There has been improved management and communication for promotions management." (See Goliath Unlocks Retail Secrets with RFID for details of how drugstore chain Walgreens improved promotions management with RFID.)

Brown noted it was easier for Daisy Brand to make extensive use of RFID than it might be for other organizations because the company makes a limited number of products, and had little bar code infrastructure in place. He asserted Daisy Brands is receiving positive return on investment from its RFID systems, but did not provide specific figures about cost savings or operational improvements.

"Our focus going forward will be on data analytics so we can learn how we can improve from the information we get from RFID," Brown said.

When asked if going beyond its current pallet-tagging and applying RFID tags at the item level would provide incremental benefits, Brown said he didn't know and that Daisy Brand hadn't studied the issue. The question will become important to many consumer products manufacturers now that retailer Sam's Club has set a deadline of October 31, 2010, for suppliers to tag products at the sellable-unit level (see Sam's Club Wants Item-Level RFID Tagging by 2010).
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