In the early 1980s Setzer used a variety of manual systems--paper-based procedures that were riddled with human error--to keep tabs on the fluid inventory. A warehouse worker, for example, might move a roll of spandex from the warehouse to the finishing plant and never mark down the transfer. Or because a roll of white spandex and a roll of white cotton can look the same, workers might mistakenly load the wrong material onto outbound trucks. Moreover, preparing detailed shipping reports for eager converters was a tedious chore that required hours of tallying up bills, using pencil, paper, and calculator. At best, reports were sent out twice a week. "Reporting like that may have been fine 30 years ago," says Setzer. "But not today, when the imports are beating our brains out." Even after purchasing a minicomputer in the late 1980s to enter the information into, errors persisted. "I hate to admit it," he says, "but we had little control over what was going in and out of our building."
So three years ago Setzer enlisted the help of Sean Turner, the owner of Unitech, a systems integrator in Atlanta and Hickory, N.C. Turner replaced Unifour's minicomputer with a Novell network running on an IBM file server, giving everyone--from the chief financial officer to warehouse loaders--access to the same information. After refining the order-entry and accounting systems, Turner tackled inventory management, installing four real-time radio-frequency (RF) bar-code scanners, made by Hand Held Products (800-582-4263; $1,499 per unit). In the past bar-code scanners that could update computers using RF links were difficult to install and outrageously expensive. In fact, most RF systems were built to transmit signals in enormous warehouses of 100,000 square feet or more, and businesses were required to apply to the FCC for an operating permit. "It was like owning your own FM station," says Turner. That all changed in the early 1990s, when prices dropped dramatically and FCC regulations no longer applied to many systems. Turner's last move was to connect the scanners to the inventory-management system to provide an up-to-the-minute picture of what was in the finishing process, what was in the warehouse, and what had already been shipped.
The upgrade has cost Setzer more than $80,000 in the past two years. But just knowing that every morning he can accurately report to his converters has made the outlay worth it. "We're more accountable to our customers today than we ever have been," says Setzer. "And we can take on more business without fearing that we'll lose track of what's leaving the warehouse."
Today as soon as goods enter Unifour's warehouse, employees key a work order into the computer, including shipping instructions and a packing-slip number. The computer then spits out bar-code tags that are attached to each individual roll of fabric. Workers walk through the warehouse carrying the small wandlike scanners and scan a bar-code tag any time they move a roll even a foot; then, using the scanner's alphanumeric keypad, they enter which aisle they've moved the roll to. When an order is ready to be shipped, workers reenter the packing-slip number and scan the tags on the individual rolls that are loaded onto the trucks. If a worker mistakenly loads the wrong item, the RF scanner flashes a red light and makes an audible tone.
Generating bills is just as simple. As the rolls of fabric are scanned throughout the finishing process, the computer builds an electronic invoice. Before the finished rolls are loaded onto a truck, the name of the trucker and the cost of shipping are entered into the main computer. Office workers then need only punch a few keys to print out a customer's invoice. Not only are customers happier because they receive bills faster, explains Setzer, but Unifour benefits because it gets paid sooner. "This system has helped us improve what's nearest and dearest to us--our cash flow," he says.
A Handle on Growth
For FMC, which recently became an independent subsidiary of the St. Paulbased Merrill Corp., tracking wasn't particularly tricky, but managing the shipping needs of an exploding business was.
When Mark Trumper and Bill Smith acquired FMC, in 1987, it was operating out of the basement of a small house in Ballard, Wash. For the company's minor shipping demands, Trumper, the CEO, and Smith, the president, purchased a $4,000 Pitney Bowes shipping automation system--basically a 386 computer electronically attached to a digital scale--that came preloaded with United Parcel Service (UPS) shipping rates and could generate UPS packing slips and tracking numbers.
The Pitney Bowes machine served FMC well for five years. Then its large retail customers began demanding smaller shipments of product. Nordstrom, for example, was no longer willing to sacrifice valuable storage space to hold 50,000 invoice forms for the women's apparel department. So FMC introduced a new concept: distributor as warehouse. It stopped shipping in bulk and began filling orders according to customers' precise specifications, essentially putting together variety packs for each customer and holding on to the rest.
