Pacific Cycle finding real-world benefits from its RFID implementation

Bicycle manufacturer Pacific Cycle, a division of Dorel Industries, has successfully implemented radio frequency identification (RFID) capabilities within its SAP NetWeaver platform. With its go-live on March 31, 2005, the Wisconsin-based manufacturer of such name brand bicycles as Schwinn, GT, Roadmaster and Mongoose claims to be surpassing the "Wal-Mart mandate," which requires the retailer's top 100 suppliers to tag pallets and cases shipping to select Wal-Mart distribution centers.

The SAP technology is enabling Pacific Cycle to reap the business gains of an adaptive business network -- automating warehouse activities, creating newfound data transparency across the supply chain and helping ensure the right shipment to the right place at the right time.

Pacific Cycle’s goal was to reduce total cost of ownership by scaling its RFID pilot project -- targeting immediate benefits through supply chain automation and leveraging its existing SAP software investment for further gains across its global operations. The RFID capabilities of SAP NetWeaver contain several preconfigured components designed to help reduce implementation time, including SAP Auto-ID Infrastructure, which controls the RFID process while simultaneously converting raw RFID data into actionable business information; embedded and preconfigured data warehousing to report read rates and inventory movement metrics both internally and externally across the supply chain; a data exchange infrastructure to translate and route actionable information into back-end systems; and event management capabilities to record and track events and identify exceptions.

"We realized early on the tremendous value that RFID could deliver in helping us streamline our manufacturing and distribution process," says Ed Matthews, director of information systems, Pacific Cycle. "By implementing SAP RFID technology, we consciously went beyond the Wal-Mart mandate. We integrated RFID into our existing mySAP ERP landscape and were able to eliminate several manual steps on our outbound delivery process. At the same time, we have been able to leverage our existing infrastructure to have more visibility of tagged RFID inventory in our retailer's supply chain. This transparent, real-time data helps us create a more efficient and transparent supply chain while reducing inventory levels as well as charge-backs."

Currently, some 200 Pacific Cycle employees are using the SAP solution. In the near future, Pacific Cycle plans to extend the RFID label application to its manufacturing plant in China in order to gain additional value through more accurate and timely information and a reduction of handling costs.

The project was realized with the help of the implementation partner, PEAK Technologies, which provided the device controller software.

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