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Manual data collection process can bog down inventory management and production processes, and introduce inaccuracies and inefficiencies throughout a company’s operations. Red Gold, one of the nation’s largest tomato product distributors, has raised their inventory accuracy to 99% and improved production tracking by replacing its manual system with a bar code-based data collection solution. By improving efficiency, Red Gold was also able to increase its production volume by 25% without adding more employees at its facilities.
Red Gold, in business since 1942, is one of the largest tomato canners in the U.S., and produces the brands Red Gold, Redpack, Tuttorosso, and Sacramento Juices, along with a number of private label store brands. The Orestes, Ind.-based company was using a wholly manual, paper-based process to track inventory and finished goods production. As cans of tomato products were loaded into cases and palletized, machine operators, lift truck operators, and palletizer operators would have to write down multiple pieces of information in order to record production.
Primarily, operators had to note a variable-length case code that was stenciled onto each box. These codes, which could be eight or14-characters long and included both alpha and numeric characters, were unstructured and not always printed in the same place on the boxes. Although the case codes were a key part of the company’s product traceability system, manual data collection created multiple opportunities for transcription errors. Red Gold’s primary distribution center may have 50,000 to 60,000 pallets in storage on any given day, and between 100 to 200 trucks moved in and out of the facility each day. With this high number of product moves, the manual process simply couldn’t keep up.
“The operators were reporting the case code in several different places,” says Trevor Kaye, senior project manager, supply chain, at Red Gold. “They had to put that code on the pallet sticker, and also report it to the quality assurance organization so they could enter it into their records. They also had to record the number of cases on a pallet, and the number of pallets they had produced.”
Red Gold needed to improve its data collection operations, while also improving the company’s ability to track inventory. “We didn’t just want a data collection system,” says Debra Ivey, application development manager. “We were trying to streamline the process of tracking our pallets of product.”
Timeliness of data was also an issue, since the pallet data was only entered in the company’s Infor BPCS/LX enterprise resource planning system once per day. “You’d have people operating for 24 hours and then at some point the following day, clerks would take this data from people in the production area and put it into the computer system,” Kaye says. “Not only could the operator write down the wrong number, but the clerk could potentially key enter it incorrectly. Nobody knew what our inventory accuracy was back then; we just knew it was bad.”
While Red Gold had very clear goals for its data collection solution, deploying such a system was no easy task. First, the company needed buy in from the people in the company who would have to use it each day, and the new system had to be installed with minimal modifications to the existing ERP system.
It was Ivey who discovered the QuikTrac data collection solution from Integrated Barcoding Systems in Adrian, Mich. QuikTrac integrates directly with the BPCS system, which was a key selling point for Red Gold.
“We have a mandate here that we will not modify our systems unless it is absolutely necessary,” says Randy Merle. “Any provider we partner with understands that from the beginning.”
Red Gold installed a wireless LAN, along with bar code scanning and printing equipment to work with the QuikTrac solution. Operationally, the only thing that changed on the shop floor was the data collection process.
“There was no change to the physical process,” Kaye says. “We had a lot of work to do to demonstrate the changes that were going to happen, but in most cases we were making things easier for the operators.”
During production, operators on the palletizing line receive production information on their hand-held Intermec computers, including the traceability codes for the product. As each pallet is completed, the operator creates a bar code label on a Zebra Technologies printer that is then attached to the pallet and used for tracking purposes. Data is transmitted wireless via a Cisco Systems wireless LAN.
Lift truck operators then use vehicle-mount Intermec scanners to record that the pallet has been produced. The lift truck moves the pallet to a storage location in the warehouse facility, and the operator scans a bar-coded placard at the location to record the putaway data. Pallets may also be loaded into an over-the-road truck for shipment to the main distribution center. In that case, the pallets are scanned when they are loaded and again when they are received at the DC.
When product is pulled for shipment to a customer, operators know exactly where to go to find the correct pallets. The labels are scanned again during picking and shipping. “We’ve designed QuikTrac so that the operator can put in the order they want to pick, and that triggers QuikTrac to reach into the LX databases via an ODBC connection to gather all of the information about that order, including items and quantities,” Ivey says.
“What QuikTrac has done for us is automated the recording of those inventory transfers within LX,” Ivey continues. “As we pick orders, the system validates those items and quantities are accurate according to the order within LX, while creating an order allocation.”
While most orders are for full pallets of product, the QuikTrac solution also allows operators to build mixed-pallets within the system, and generate new pallet labels that reflect these case moves. The QuikTrac solution also helps manage the storage and retrieval of unlabeled “bright” goods (cans of tomato product that have been stacked on pallets, but don’t yet have product labels on the cans). The data collection system helps manage the process of moving those items from storage to a depalletizer and through the labeling line, then to the case pack and palletizing process.
The solution was deployed in phases between 2002 and 2007 at Red Gold’s three manufacturing facilities in Orestes, Elwood, and Geneva, Ind., three support warehouses, and its one-million-square-foot distribution center in Alexandria, where QuikTrac works in conjunction with the Infor WM9 warehouse management solution.
By far, the biggest benefit of the new solution to Red Gold has been a tremendous lift in inventory accuracy. “Our accuracy is now above 99%,” Kaye says. “We no longer do full physical inventories, because our accuracy is so high.”
The company has also been able to reduce the number of clerical staff and lift truck operators in its DC because of the improvement in inventory accuracy and the speed of the automated data collection solution. Staff that had been focused on data entry can now spend more time validating and analyzing the data generated by the automated solution.
“Because of the data collection solution, we can have fewer people at all of these work stations,” Ivey says. “We realized labor savings at multiple points throughout the process, and we’ve been able to increase our volume by 25% without adding new staff.”
Red Gold also has a database of pallet-level information that is much more granular and detailed than it had in the past. “Because of the robust database of what is on each pallet, we can do a much better job of identifying when we produced a product, what’s on each pallet, and where it was shipped to,” Kaye says. That has been increasingly important because as a food producer, Red Gold is subject to stringent FDA traceability requirements, as well as customer traceability requirements established by the Safe Quality Foods (SQF) standard.
“A few years ago, if you’d asked us to track down a specific product, if we had the answer inside of a week that would have been wonderful,” Kaye says. “Now we can have that data within a two or three-hour timeframe. A lot of that has been driven by regulatory changes, but it ahs been facilitated by automated data collection.”
Another benefit has been that all of Red Gold’s facilities have standardized their case codes in order to improve the performance of the solution. “Those codes were very difficult to record originally,” Kaye says. “As the quality organization realized there would be a significant advantage of using data collection for product traceability, they standardized those case codes. Without the ADC system, we didn’t have a prayer of getting that kind of standardization.”