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Pacific Cycle Seizes Business Process Gains from RFID Automation with SAP |
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Bicycle Manufacturer Pedals Beyond the Wal-Mart Mandate to Forge Adaptive Business Network with RFID Capabilities of SAP NetWeaver™
MADISON, Wis. - May 16, 2005 - SAP AG (NYSE: SAP) today announced that Pacific Cycle, a division of Dorel Industries (NASDAQ: DIIB; TSX: DII.MV; DII.SV), has successfully implemented SAP’s leading radio frequency identification (RFID) capabilities within its SAP NetWeaver™ platform. With its go-live on March 31, 2005, the Madison, Wisconsin-based manufacturer of such name brand bicycles as Schwinn, GT, Roadmaster and Mongoose is now 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 chose the SAP solution with the aim of reducing 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 that help reduce implementation time while maximizing value, including SAP Auto-ID Infrastructure—a key component of the SAP NetWeaver platform, 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.
“Pacific Cycle realized early on the tremendous value that RFID could deliver in helping us streamline our manufacturing and distribution process,” said 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.”
The project was realized with the help of the implementation partner, PEAK Technologies, headquartered in Columbia, Maryland. One of the world’s largest SAP systems integrators of RFID and automatic identification and data collection systems, PEAK provided the device controller software (PEAK Automation Controller) that enabled Pacific Cycle to seamlessly integrate multiple RFID hardware devices into SAP® Auto-ID Infrastructure. PEAK Technologies delivers its device management software on the SAP NetWeaver™ platform, therefore further leveraging existing infrastructure and skill sets of SAP customers.
“RFID middleware is a critical component to a company’s overall RFID strategy, as it’s the glue that connects the physical world of tags and readers to enterprise applications that will leverage the information that the tags contain,” said Dennis Gaughan, research director, AMR Research (“Making RFID Middleware Decisions in a Changing Marketplace,” April 2005). “Early RFID adopters are struggling to find the balance between low-cost deployment and long-term investment protection. Selecting the right partner for RFID middleware depends on a number of familiar factors, including product functionality, domain expertise and company viability.”
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.
“Pacific Cycle’s RFID project is a primary example showing how companies can derive business benefits beyond the immediate requirements of meeting retailer mandates,” said Claus Heinrich, member of the executive board, SAP AG. “At the same time, the implementation shows what strategic vision can accomplish in creating real-world awareness, both in a manufacturing environment and throughout the entire supply chain.”
About Pacific Cycle
Pacific Cycle is the leading supplier of quality bicycles in North America and a division of Dorel Industries Inc. The company designs, markets and imports a full range of bicycles and recreation products under the brand names of Schwinn, GT, Mongoose, Pacific, InSTEP, Pacific Outdoors, Roadmaster and Dyno. Pacific Cycle is headquartered in Madison, Wisconsin with offices in Olney, Illinois and Lake Forest, California. The company has distribution centers in Olney, Illinois, and Vacaville, California.
About Dorel Industries Inc.
Dorel Industries is a global consumer products company engaged in the designing, manufacturing and marketing of a diverse portfolio of powerful consumer brands, sold through its Juvenile, Home Furnishings, and Recreational/Leisure segments. Headquartered in Montreal, Dorel employs approximately 5,000 people in 14 countries. Dorel also has offices in Shanghai and Shenzhen, China which oversee the sourcing, engineering and logistics of all Asian operations. 2004 sales were US$1.7 billion.
In addition to Pacific Cycle, Dorel’s U.S. operations include Dorel Juvenile Group USA, which markets the Cosco and Safety 1st brands as well Eddie Bauer and Disney Baby licensed products; Ameriwood Industries, which markets ready-to-assemble products under the Ameriwood, Carina, SystemBuild, Altra Furniture and Ridgewood/Charleswood brands as well as California Closets and Trading Spaces licenses; and Cosco Home & Office, which markets home/office products under the Cosco and Cosco Ability Essentials brands and Samsonite license. In Canada, Dorel operates Dorel Canada, Ridgewood Industries and Dorel Home Products. Dorel Europe markets juvenile products throughout Europe, under the Bébé Confort, Maxi-Cosi, Quinny, Safety 1st, Babidéal, and Baby Relax brands. Dorel Asia sources and imports home furnishings products.
Dorel Industries Inc. is a global consumer products company and is listed on the Toronto Stock Exchange under the symbols DII.MV and DII.SV in Canada and on the NASDAQ Exchange under the symbol DIIB.
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