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Propelled by a recent acquisition as well as by retailers RFID (radio frequency identification) requirements, specialty food maker Bruce Foods is about to go live with phase one in a far-reaching rollout of RedPrairies supply chain software.
“Itll be like going from a sandbox to the moon,” said Patrick Brown, director of purchasing and logistics for the New Iberia, La.-based specialist in hot sauce, canned yams and Mexican food items.
Beyond Bruce Foods, RedPrairie Corp. supplies WMS (warehouse management system), TMS (transportation management system) and RFID software to at least 550 other food makers.
The supply chain vendor also targets HBA (health and beauty aids) manufacturers that sell their wares on retail shelves, said Matt Reinke, business development leader at RedPrairie. Earlier this summer, RedPrairie announced the addition of Unilever to its roster of supply chain customers.
For its part, Bruce Foods claims a long list of retail partners, including Wal-Mart and other giants. Founded in 1928, the company is a longtime ERP user. But Bruces warehouse and transportation management were completely manual up until now.
Brown anticipates major efficiency improvements with the launch of RedPrairies WMS and TMS at company headquarters in August. Over the three subsequent months, Bruce Foods will phase in the software at satellite plants in El Paso, Texas; Wilson, N.C.; and Coteau, La.
For the 2005-06 time frame, the food manufacturer expects to add RedPrairies Igniter RFID to the supply chain software mix.
Yet the companywide deployment at Bruce Foods still faces big challenges. With harvests looming and the holiday season soon to follow, the manufacturer needs to ramp up in time to meet its biggest production crunch of the year.
“RedPrairies main challenge at the moment is to help them get there,” Reinke said. “Our guys are over there with them right now.”
“The integration issues are huge,” Brown acknowledged. The companies are working on integrating an existing IBM AS/400-based ERP system with Windows versions of RedPrairies WMS and TMS software.
As analysts see it, the supply chain implementation at Bruce Foods stands out from the pack due to its extensiveness.
“Its very unusual for a company to implement WMS and TMS both at the same time. It may also be a bit unusual for a [specialty food maker] to be planning an RFID deployment now,” said Steve Banker, services director for supply chain at ARC Advisory Group.
“On the other hand, RFID resources are rather thin. There may not be enough RFID solutions providers to go around. Getting a slot in line isnt a bad idea at all,” Banker said.
According to a recent report by AMR Research, RFID is now emerging as a major force behind SCE (supply chain execution) spending, particularly in the WMS market.
“Wal-Mart has mandated that its top 100 suppliers support RFID tags on pallets, cases and cartons by January 1, 2005,” the report noted. “The Department of Defense also announced its intent to require RFID tags on supplies by January 2005.
Next Page: Deadlines loom for RFID compliance.
Deadlines Loom
“Target and Albertsons just recently joined the fray, with their mandated compliance dates for the first phase of RFID adoption set for spring 2005,” the report said.
Furthermore, Wal-Marts Tier 2 and Tier 3 vendors must comply with the retailers RFID mandate by January 1, 2006, and all other Wal-Mart suppliers must do so by the start of 2007, according to Reinke. “Phase 2 at Bruce Foods will be RFID,” he added.
Even outside of these RFID requirements, though, Brown said Bruce Foods had been contemplating a move to supply chain software for quite some time. Thoughts about WMS and TMS got a major impetus when the company acquired Cajun Injector last year.
“Cajun Injector added a large number of SKUs, as well as LTL [less than truckload] shipping,” Brown said. “Now, we need a system that can handle LPN [license plate number] and ASN [advanced ship notice], in addition to future RFID.”
After an evaluation process, Reinke said Bruce Foods chose RedPrairie over three other supply chain vendors: Manhattan Associates, 3Ms High Jump and Logility.
In its report, AMR ranked the category of “foods, beverages and consumer packaged goods” as No. 2 in license revenue and share in the manufacturing sector for the 2003 supply chain market. The categorys total of $191 million was topped only by the category of “computers and electronics (peripherals, communications, semiconductors),” which raked in $265 million.
“RedPrairie is one of the leaders in the food and beverage space,” ARCs Banker said during an interview. “Like many other vendors, RedPrairie offers core functionality for lot tracing, a capability for managing date-sensitive products in compliance with FDA regulations.”
But from a functionality standpoint, Banker said, RedPrairie really excels at “engineered labor standards.” Such standards—widely used in this particular vertical—say, for example, “It should take you 12.2 seconds to do this specific task.”
Brown pointed to several other reasons why Bruce Foods gave RedPrairie the nod over its competitors: recognized domain expertise, ability to comply with emerging RFID requirements and effective systems integration tools.
Next Page: Choosing between Windows and Linux in the supply chain.
Windows or Linux
?”> One requirement for software was that it would integrate well with a JBA System 21 ERP system from Geac, which runs on AS/400 hardware at Bruce Foods headquarters.
“A lot of supply chain vendors offer software that will operate on both AS/400 and Windows-based machines. But most tend to be more specialized on one platform than the other,” Brown said. “Many of them have started to support Linux, too.”
But Bruce Foods opted to roll out its WMS and TMS systems on Windows. “We were satisfied with RedPrairies AS/400 implementation. The reason we went with Windows instead was so we could run WMS and TMS locally at the branches,” he said.
Brown said he foresees cost savings from less expensive PC hardware, as well as efficiencies to be gained by making use of IT pros at branch facilities.
“We dont have anyone at the branches whos trained in AS/400. Probably, we could have put AS/400 boxes in the closets out there and let the machines run unattended, but we didnt want to do that. And we dont know enough about Linux, really, to go with that OS,” he said.
Transaction processing is now the steepest hurdle. “Our transactions have to go ERP, to WMS, to TMS, to WMS, and then back to ERP. Were using batch files to transmit transactions from the Windows machines at the branches to the AS/400 at headquarters, via routers,” Brown said.
As Bruce Foods moves forward with its multiyear WMS/TMS/RFID implementation, Brown said he isnt sure yet what new supply chain capabilities might pop up on his wish list.
“Thats a very open-ended question,” he said. “At the moment, were just [focusing] on getting the WMS-TMS system going at our headquarters site by the second or third week in August.”
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