RFID Helps Ringnes Track Beverage Shipping Containers

By Claire Swedberg

The Norwegian beverage maker is using EPC Gen 2 UHF RFID tags to track its reusable containers as they are shipped, filled with products, to retailers, and then returned empty to its distribution center.

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Beverage manufacturer Ringnes is tracking containers of beer and other beverages with RFID as they leave and return to its distribution center (DC) in Oslo, Norway. The system is improving the management of containers in the DC’s large shipping yard, as well as providing data regarding the movement of product in those containers, whether by truck or by rail. The system, designed and installed by IBM Global Technology Services, employs hardware provided by Intermec. A similar system has been deployed this month by Volkswagen—again, to track containers—at its assembly plant in Wolfsburg, Germany.

Ringnes, a subsidiary of the Carlsberg Group, is Norway’s largest brewery and supplier of soda and bottled water. The firm sells approximately half a billion liters (132 million gallons) of beverages each year. From the Oslo facility, it ships the product in about 200 trucks, as well as by rail. The company is using an RFID system to track the containers loaded with beverages as they are shipped to retailers, and then as they return from the product distributor, either empty or filled with empty bottles.

Due to the volume of product, as well as the quantity of retailers receiving it, Ringnes found it difficult to track containers as they were loaded and transported to stores from the company’s distribution center, as well as the empty containers and bottles as they returned to the DC. Employees visually checked the container yard to determine which containers were available, and also utilized paper records to understand where containers should be. What the firm wanted was an automated system with which it could know how many containers—and of what size—were available for loading, as well as the exact time they were loaded and left the yard for a retailer. “We wanted to have more information, especially inside the distribution center,” says Jon Kvande, Ringnes’ process-development manager.

Ten years ago, the Carlsberg Group—Ringnes’ parent company—had considered RFID tagging for pallets, after discovering that bar-coded labels tended to fall off or become damaged. At that time, however, the price of RFID technology was too high, Kvande says. Two and a half years ago, with prices lower, Ringnes approached IBM seeking an RFID solution that could include RFID tags for containers or pallets. In December 2008, after carrying out a pilot project involving the use of RFID tags on containers, the company decided to launch the container application to help it track approximately 300 containers in and out of its Oslo yard.

Because the containers were loaded with beverages, the RFID system had to operate well around fluids, which can sometimes interfere with RF signals, particularly ultrahigh-frequency (UHF). But the robustness of the tag was another problem: the reusable containers were frequently washed under high pressure, which could cause the tags to become damaged. IBM chose Intermec Small Rigid EPC Gen 2 UHF RFID tags, Kvande says, which are working well. Ringnes has applied two tags to each container.

The company has also installed 11 Intermec IF5 fixed interrogators and 42 antennas at the container yard’s entrance gate, and at the DC’s dock doors. When a truck enters through the gate, an RFID interrogator reads the unique tag ID numbers of the container onboard that truck, then transmits that information to the company’s back-end system. IBM’s WebSphere Premises software stores that ID number in the firm’s standalone server, which links it to the container’s data and history, such as its size and where it has traveled. In this way, Ringnes knows that the retailer has returned the container.

When the truck is backed up to the dock, the container tags are read once more, thereby indicating the workers have unloaded its empty bottles, and that the vehicle is now ready to be loaded for another shipment.

IBM’s DB2 Alphablox software enables Ringnes to run reports, such as analyzing how long it took for a container to return from a supplier, or the length of time it sat in storage at the Oslo facility.

The system has not yet been underway long enough for Ringnes to predict a return on its investment, Kvande says, but the company has already derived some valuable lessons from the deployment. “The most interesting information we have had,” he notes, “is that we have too many containers.” Previously, the beverage maker had believed it had too few containers since it did not always have the necessary size of container available when needed. After using the RFID system, the firm discovered it not only had sufficient containers, but possibly too many. “We’ve also reduced how much time is spent loading and unloading,” Kvande states, because the containers are in place more quickly at the dock when required.

According to Kvande, the next step in the deployment will be to integrate the RFID system with the company’s ERP and warehouse management system, after which he envisions the system being utilized to make the loading of containers more automatic. Once an order is placed, for instance, the system should be able to indicate exactly which container is available for reloading, and it can be brought to the loading dock much more efficiently than with the previous system, in which individuals had to search the yard to determine if the proper size container was available.

“We’re also thinking about asset management,” adds Kvande, who envisions placing RFID tags on the refrigeration units that his company provides to retailers for the cold storage of beverages. If employees need to move or service a refrigerator at a store, he says, they can simply employ a handheld reader to scan an RFID tag on the refrigerator, thereby creating an electronic record of which refrigerator has been delivered, removed or serviced. Currently, workers read serial numbers off the refrigerators, then manually write them down on paper.

In the meantime, Kvande says, the company expects to apply tags to additional containers. Although the Oslo facility has now tagged all 300 containers at its site, it hopes to RFID-enable two other distribution centers in Norway in the future.

In addition, Volkswagen is employing an RFID system designed and deployed by IBM to track 3,000 reusable containers. In this case, the carmaker is using the system at its Wolfsburg assembly plant to track metal boxes that store sunroofs as they arrive from the supplier. In large part, VW’s workers have used paper records to manually manage the containers, as well as the inventory within them. However, containers often go missing, and the company has found it difficult to discover their absence in a timely matter. The auto manufacturer also wanted a way to improve visibility into its inventory as it assembled its vehicles. After choosing the system provided by IBM, similar to that currently being used by Ringnes, the company carried out a one-year pilot project, which concluded in late 2008.

Each container tag has a unique ID number linked, in the IBM WebSphere Premises software system, to information regarding the sunroofs contained within, as well as the date and location that the tag was read. In that way, Volkswagen tracks not only the containers, but also the sunroofs. After the containers are received and their tags scanned with a fixed reader, they are then moved to the company’s warehouse. Later, says Christian Clauss, IBM’s Zurich-based director of sensor network solutions, as the containers are brought to the assembly line, an employee with a handheld interrogator reads the container tags again, thereby indicating the items are about to be installed.

The empty containers are then read once more en route to the warehouse, and out the dock doors onto a truck, to be returned to the supplier.