With Real-Time Warehouse Scanning, The Mark Group Can Find Its Products

Replacing a cumbersome paper-based system, the catalog/retailer installed RF technology that allows it to track inventory, cross-dock back orders and expand the business

There is probably nothing more frustrating in a warehouse than to go to a rack expecting to pick an item and find that it is not there.

Yet that was often the situation at The Mark Group's home warehouse in Boca Raton, Fla., back when the cataloger/retailer tracked products with a paper-based system. Indeed, in Boca Raton there were months when the "can't find" ratio hit 14%, says warehouse director Tod Fox, adding with much understatement, "It was a major inefficiency."
Double-digit "can't-find" reports were only one symptom of the problems created by the antiquated legacy system. For a $100 million company with three catalog lines, 12 stores, and six discount outlets, tracking merchandise on paper in Boca Raton was "like having an 80,000-square-foot closet," jokes Fox. He joined the company in 1996 during the transition to the present system, which creates bar codes for incoming merchandise and tracks it electronically from receiving to shipping, using the combination of an RF LAN system, handheld scanners and bar-code
printers.

The Mark Group's warehouse in Boca Raton handles catalog sales of apparel that account for 75% of the company's revenues. The problems were less dramatic but still significant at its 40,000-square-foot Atlanta warehouse, which manages catalog sales of furniture and home decorating items that together account for 20% of product movement. The final 5% of sales comes from stores.

The impact of the new technology has been considerable. The Boca Raton warehouse reduced the number of employees from 260 to 140 while handling a volume increase of 6%. Those changes alone produced an immediate return on investment, Fox says. In addition, all back-order merchandise is now cross-docked, shipping out in about 12 hours. Overall, the average number of days to ship has dropped from three to one. And that can't-find ratio has plummeted to 0.25% "Before, there wasn't any tracking," Fox says.
"With real-time scanning, we put in a lot of checkpoints, so now we know at any time where an item is."

Under the old system, incoming stock was not recorded until the end of a shift, when an accumulation of paper tags was keyed into the computer system. With the new technology, Fox says, a stocking employee might put away a couple of hundred pieces in an eight-hour shift, the same number as before, but real-time scanning makes the information available as they work.

Returns have been streamlined too. "We sell fashions, so we have a high rate of returns," Fox says. "Those are individual pieces that have to be dealt with." For returned merchandise, the bar code on the return ticket is scanned, and if the item passes inspection, the information on its availability goes online in
the network. There are 14 returns-processing stations in Boca Raton and four in Atlanta, each equipped with a printer for label renewal.

Besides improving product tracking, The Mark Group's new warehouse systems "gave us the ability to grow," says Fox. "That's the No. 1 thing we got out of this." Under the old paper-based system, it was all one company, he explains. The company is now divided into three catalog lines: Mark, Fore & Strike (women's sportswear and accessories); Boston Proper (designer apparel for women 25 to 50); and Charles Keath (home accessories, gifts and quality apparel).

"Now we function as three different companies servicing one catalog apiece," says Fox. "To us, Boston Proper is 'company two in warehouse one [Boca Raton].' We can determine the work we're doing for each company, and the accountants seem to find that pretty helpful. Also, the company's going on the acquisition trail, and we already have the systems in place to add company four."

Two-year process:

The Mark Group began its search for new technology in 1995. Information services administrator Mike Leonard says the transformation began with the choice of a Spectrum One RF wireless
LAN system from Symbol Technologies, Holtsville, N.Y. The changeover continued with the selection of Compsee, Mount Gilead, N.C., to install the RF system, which includes LRT 3800 handheld laser scanners, chargers and multiple transmitting bases, as well as bar-code printers from Monarch and Zebra. Compsee was selected in part for its ability to handle installations at both warehouse locations.

Compsee integrated the new RF-based system at first with legacy order processing and fulfillment software running on an RS/6000, a process finished early last year. Nine months later, the system migrated to an AS/400, connecting with new Mozart order-and inventory-management software from
CommercialWare, Framingham, Mass.

Employees at the Boca Raton warehouse now use 35 to 40 RF guns, five to six portable bar-code printers and 12 to 15 bar-code printers attached to terminals in the returns area. "The Symbol gun is excellent," Fox says. "The antenna is integrated, not hanging off the side, so it's very durable."

At the Atlanta facility, data from the Symbol network is fed to a Unix-based network controlling unit that relays it through an unswitched hub, then via a Tl line to the company's router in Boca Raton, where the data becomes available to the whole system.

At the Boca Raton warehouse, receiving stations for store goods and catalog items are located in different parts of the facility. Receivers check incoming deliveries against an electronic purchase order, confirming the identity and quantity of merchandise. Printers, which can access that information either
from the scanner or from the computer that holds the electronic purchase order, generate labels, each with a bar code plus a description in English.

Those labels become the license plate numbers (LPNs) for the cases to which they are applied. Each LPN identifies the products in the case, quantities and the date and time of receipt. Each item is tracked by its LPN until it goes to a "primary" location for shipment.

All parties agree that, on the whole, the implementation of the new technology went smoothly. However, Fox adds, "The new system took a lot of training up front--about 60 days--to get people used to the idea of what real-time controls mean. They just didn't understand that when you scan something with that gun, you've updated the computer."

Another snag occurred last fall, when the Mozart software was installed on the AS/400. Suddenly the scanners' response time--how long it took to communicate with the back-room server--jumped from sub-second to three-seconds.

The reason for the slowdown involved the changeover in warehouse management software and the accompanying change in communication protocols, from TCP/IP communication to a direct SDLC protocol communication between the Symbol scanners' 56K modems and the server.
"All that was needed " Leonard says, "was to install a 5250 emulator on each of the guns." Then all 5250 emulator elements were made compatible with TCP/IP, and operations proceeded once again at sub-second speeds.

Reprinted from:

Retail Technology Magazine
Kimball Livingston
March 1998

Background

Compsee initially met with an independent consultant retained by The Mark Group and was presented with some interesting integration challenges.

Provide a system capable of being on-line to both their current Hewlett Packard (HP9000) host running their Legacy software, as well as to their new IBM (AS/400) host running Mozart software.

Provide full system redundancy in the warehouse, as well as future capabilities to add any remote warehouses they may acquire.

The integration challenges were further complicated due to different topology and protocol requirements originally implemented with each of the hosts.

The challenges and requirements were met and exceeded by Compsee’s Systems Group along with providing the following enhancements:

dial-up capabilities to the RF system for remote support
transparent swapping between redundant backbones should one fail
guaranteed on-site service response

With the acquisition of the Charles Keath Catalog, The Mark Group now takes advantage of:

55 RF laser scanners (35 in Florida, and 20 in Georgia)
20 stationary barcode printers for handling returns labeling
6 portable printers attached to the RF laser scanners for product and shelf location re-labeling.

Since the initial installation the Mark Group replaced their HP9000 with an IBM RS6000, utilizing Compsee’s Systems Group for support during the transition. Having planned for this from the onset, the equipment supplied by Compsee supported all of the system changes with minimal re-investment.