RFID: Keeping tabs on 18 million tomatoes
Scratching your head about how RFID technology could be used at your organisation? Here’s a great example of a (relatively) local company using IBM’s RFID expertise to position themselves strategically with customers, as well as getting internal efficiency gains when processing and distributing 18 million tomatoes annually...
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Moraitis Fresh, Australia’s leading fresh produce company, was formed by Nicholas Moraitis with the simple objective of providing customers with the very best quality of products and service. Moraitis now grows, processes, packages and wholesales fresh produce through a branch network which extends throughout all major growing districts and retail markets throughout Australia. Moraitis has always been an early adopter of technology as it strives to improve the quality, availability and variety of produce for the Australian consumer. Central to the Moraitis ethos is the assumption that everything the company does, no matter how large or small, can in some way be done better. Recent technological improvements have included optical grading, controlled atmosphere storage, and modified atmosphere packaging of produce. Moraitis is also constantly fine tuning its back-end systems and the company is engaged in an on-going search for new fruit and vegetable varieties to extend shelf life and growing seasons. Supply partner commitment To achieve this, Moraitis relies on close partnerships with its preferred suppliers to integrate accountability and commitment to quality along the supply chain. Trained staff monitor every aspect of quality and food safety during processing to verify the effectiveness of control procedures, and so enable the company meet the needs of an increasingly demanding marketplace. This commitment to quality, safety and traceability has led Moraitis to impleimplement an innovative RFID (Radio Frequency Identification) track and trace system in conjunction with IBM. The system will increase operational efficiencies throughout Moraitis’ supply chain and improve product quality. It is believed to be a first for the Australian fresh produce industry. Continuous monitoring The RFID system provides accurate data on origin, packing date, type, quality and size of the four tonnes of tomatoes leaving Moraitis every day. Moraitis will be able to monitor key metrics such as waste per batch and the exact number of trays received from each grower. Moraitis uses 15.56 MHz (high frequency) tags, because these work better than the UHF 900 MHz tags in moist conditions. When the tomatoes arrive at the Moraitis Sydney dispatch base, staff use handheld RFID readers to identify the trays, and they then allocate a lot number to make them ready for retail. As the RFID system is fully integrated into Moraitis’ business operations, the wholesaler will gain competitive advantage through the improved distribution system and enhanced information sharing with supply chain partners, including growers and supermarket retailers. “Fresh produce is increasingly a differentiator for Australia’s supermarket retailers,” says Con Colovos, chief information officer at Moraitis. “Our use of RFID is a first for the fresh produce sector.” IBM Business Consulting Services had earlier implemented Lotus Domino and the WebSphere portal alongside the Navision ERP system. Together these systems manage everything from ordering to production reporting. “The foundations have to be right,” says Colovos. “If your ERP system is not capable, flexible, and scalable for future growth, then you’re in a lot of trouble.” John LaVacca, IBM Business Consulting Service’s Asia Pacific supply chain partner, says Moraitis’ use of RFID technology will dramatically change the way business is done in the supply of fresh produce. “It will provide complete accountability and traceability of food across the entire fresh produce supply chain. This will allow Moraitis to change the way it operates, to view its business differently, identify ways it can improve its operations even further and grow in a highly competitive marketplace.” Global mandates “As a result, Australian companies like Moraitis can capitalise on these lower costs to implement solutions that were not previously viable.” RFID (Radio Frequency Identification) is a technology that utilises radio frequency waves transmitted from a transceiver (or ‘RFID Reader’) attached to an antenna that activates a transponder (or ‘RFID Tag’). When activated, the tag responds to the reader with a unique identifier so that the business application can identify the person, animal or article and take the necessary action such as stopping a manufacturing conveyer belt, allowing access to a building, storing tracking information in business systems or automatically making a micropayment for travel. Unlike barcodes RFID does not require line-of-sight, can read hundreds of tags simultaneously and can read up to 100 metres, depending on the frequency and transmission power used. Rapid reading Magellan supplies handheld, panel, desktop and tunnel readers. In the case of the tunnel reader as used by Moraitis, a large number of items can be tracked simultaneously without regard to their orientation. The reader can identify very large dynamic populations of tags rapidly. According to Magellan it takes just 0.944 sec to identify and read 50 words of data from 500 tags in a continuous operation. For Moraitis the ability to track each tray of tomatoes individually will allow the company to achieve internal efficiencies as well as delivering the traceability that is being demanded increasingly by distributors and retailers. “Traceability of food is something that is going to be hitting us whether we like it or not, so investing in this project was a serious business decision for the future,” says Colovos. “We’re using it to build tighter customer relationships, as the big push in Australian retail is for fresh produce.” Colovos says Moraitis’s tomato operation is now ready for Woolworths and Coles Myer. “Several other retailers have RFID pilots in place but the supermarkets are generally more advanced than the fresh produce outlets. We estimate that within another 12 to 24 months we will be ready for a full scale roll-out.” “Through the integration of the technology and the transformation of our business, we will achieve operational savings through reduced wastage, and lower inventory and handling costs,” says Colovos. For more information IBM Magellan |
May 2005
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