Italian clothing logistics companies apply RFID technology to speed up distribution
LTC is an Italian third-party logistics company that specializes in fulfilling orders for apparel companies. The company now uses an RFID reader facility at its warehouse and fulfillment center in Florence to track labeled shipments from multiple manufacturers that the center handles.
The reader system was put into operation at the end of November 2009. Meredith Lamborn, a member of the LTC RFID project investigation team, said that thanks to the system, two customers have now been able to speed up the distribution process of apparel products.
LTC, fulfilling orders of 10 million items per year, expects to process 400,000 RFID-labeled products in 2010 for Royal Trading s.r.l (which owns high-end men’s and women’s shoes under the Serafini brand) and San Giuliano Ferragamo. Both Italian companies embed EPC Gen 2 RFID tags in their products, or affix RFID tags to products during production.
As early as 2007, LTC was considering the application of this technology, and its customer Royal Trading also encouraged LTC to build its own RFID reader system. At the time, Royal Trading was developing a system that used RFID technology to track the inventory of Serafini merchandise in stores. The shoe company hopes to use RFID identification technology to better understand each store’s inventory, while preventing lost and stolen merchandise.
LTC’s IT department used Impinj Speedway readers to build a portal reader with 8 antennas and a channel reader with 4 antennas. The aisle readers are surrounded by metal fences that, Lamborn says, look a bit like a cargo container box, which ensures that the readers only read tags that pass through, rather than RFID tags adjacent to other garments. During the test phase, the staff adjusted the antenna of the channel reader to read the goods stacked together, and LTC has achieved a read rate of 99.5% so far.
“Accurate read rates are critical,” Lamborn said. “Because we have to compensate for lost product, the system has to achieve near 100 percent read rates.”
When products are sent from the production point to the LTC warehouse, those RFID-tagged products are sent to a specific unloading point, where workers move the pallets through the gate readers. Non-RFID-labeled products are sent to other unloading areas, where workers use bar scanners to read individual product barcodes.
When the EPC Gen 2 tag of the product is successfully read by the gate reader, the product is sent to the designated location in the warehouse. LTC sends an electronic receipt to the manufacturer and stores the product’s SKU code (written on the RFID tag) in its database.
When an order for RFID-labeled products is received, LTC places the correct products in the boxes according to the order and ships them to aisle readers located near the shipping area. By reading each product’s RFID tag, the system identifies the products, confirms their correctness, and prints a packing list to place in the box. The LTC Information System updates the product status to indicate that these products are packaged and ready to ship.
The retailer receives the product without reading the RFID tag. From time to time, however, Royal Trading staff will visit the store to take inventory of Serafini products using hand-held RFID readers.
With the RFID system, the generation time of product packing lists is reduced by 30%. In terms of receiving goods, processing the same amount of goods, the company now needs only one employee to complete the workload of five people; what used to be 120 minutes can now be completed in three minutes.
The project took two years and went through a lengthy testing phase. During this period, LTC and apparel manufacturers work together to determine the minimum amount of labels to use, and the best locations for labeling.
LTC has invested a total of $71,000 on this project, which is expected to be paid back within 3 years. The company also plans to expand RFID technology to picking and other processes in the next 3-5 years.
