2004 C.I.P.A. Winners

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adidas-Salomon Canada

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Increasing Efficiency Through Wireless Technology

adidas-Salomon is a global leader in the sporting goods industry, with brands built on a passion for competition and a sporting lifestyle. Its corporate strategy is to continuously strengthen its brands and products and to improve its competitive position and financial performance.

adidas-Salomon was created in 1997 when adidas International (based in Germany) acquired Salomon Sports SA (based in Annecy, France). Some well-known brands under the adidas-Salomon name include adidas, Taylor Made and MAXFLI. The adidas-Salomon Canada Ltd. head office is located in Concord, Ontario and the distribution centre is located in Brantford. With estimated 2004 sales of $216 million, adidas-Salomon Canada employs more than 300 staff. By using Application Solutions Inc.’s (ASI) Maestro warehouse management system and Psion Teklogix’ wireless hand- held scanning devices, adidas-Salomon Canada was able to cut its distribution costs in half and radically improve order accuracy.

Challenges

Prior to the parent company’s acquisition of Salomon/Bonfire and Taylor Made, leaders in the winter sports and golf industries respectively, adidas-Salomon Canada relied on a paper-based warehouse and distribution system that was not sophisticated enough to keep pace with the demands of a rapidly changing consumer market. With the acquisition, adidas-Salomon Canada was not only faced with updating this system and moving to a new automated facility, but was also suddenly faced with moving far more inventory -- 2 1/2 times more in the adidas line alone – at a time when customer demand for turnaround, accuracy and accountability was reaching new heights.

As a result, adidas-Salomon Canada needed warehouse management and radio frequency (RF) system providers that understood the dynamics of the apparel industry and with whom they could work to seamlessly integrate two different order management systems, one handling adidas products from the Canadian headquarters in Concord, the other handling Salomon and Taylor-Made orders from Portland, Oregon.

Furthermore, as a result of the acquisition, adidas-Salomon had to implement the solution while ramping up the business to encompass new product lines, hiring and training new plant employees, and making the transition to a new facility – an athletic challenge for any company!

Objectives

Key objectives for the installation included reducing picking errors and unit costs, and improving inventory accuracy by automating adidas-Salomon’s new, three-product-line Canadian distribution centre.

Solution

Enter ASI and Psion Teklogix. After extensive research, adidas-Salomon Canada decided to implement ASI’s Maestro multi-physical, multi-logical Warehouse Management System (WMS) and Psion Teklogix’s mobile computing solution, including 50 handheld and vehicle-mounted terminals, four base stations and a controller. The system also integrated custom-designed weight-confirmation technology.

With the new system in place, adidas-Salomon knows precisely what’s in its distribution centre and supply chain from the time a shipment is received at the loading dock until the time it leaves the warehouse. The new system also allows adidas-Salomon to better audit and record goods received from global factories and report discrepancies as they arrive. Finally, the new wireless technology allows inventory to be counted while all other distribution centre activities are going on. The previous system required a complete two-week shutdown to perform 2 semi-annual inventory counts. This is now a thing of the past, as adidas-Salomon is able to ‘cycle count’ with no disruption to the operations of the warehouse.

Innovative Use of Technology

Because it can be tailored to the unique needs of specific industries -- among them fashion, retail, automotive, electronics, food, pharmaceutical, and 3PL -- ASI’s WMS was a perfect fit for adidas-Salomon Canada.

In the new facility, mobile workers now use close to 50 Psion Teklogix handheld terminals with integrated scanners. There are four base stations located throughout the site, and the controller resides in the Concord head office, providing the real-time interface between the Maestro WMS and the plant workers. The controller is a key part of the solution, providing excellent throughput and fast response times for the high-transaction site. Inventory levels are more accurate, and using the wireless devices makes the process less time consuming. These advantages are helping to put adidas-Salomon a step ahead of its competition. The partnership between adidas-Salomon, ASI and Psion Teklogix was key to achieving this success.

The solution, which paid for itself in 18 months, is helping adidas-Salomon Canada compete in the extremely competitive retail market. The improved accuracy, reduced distribution costs and accommodation of increased order volumes helped adidas-Salomon Canada achieve enormous growth. The new system has resulted in increased efficiency, improved customer service and greater productivity at all levels.

A 2004 CIPA Winner!

For its exceptional and innovative application of Information Technology to solve real-world business problems and bring greater benefit to all its stakeholders, adidas-Salomon Canada was awarded a 2004 Canadian Information Productivity Award of Excellence in the Mobile Solutions category.

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