Some companies, when faced with an externally imposed activity or expense -- such as a new regulation or trading partner's request -- will simply find a way to get it over with and move on.
Other companies will look for a way to use these perceived lemons to make lemonade. A good example in the latter category is Conair Corp., the global manufacturer and marketer of health and beauty products, kitchen and electronic appliances. Responding to two customer directives, Conair has managed to not only improve its finances, but invent a new way to secure global shipments and create a subsidiary that could drive new revenues.
One of the 50 largest importers of products into the U.S. and a major supplier to Walmart and Sam's Club, Conair makes products under its own name as well as the Cuisinart, Waring, Rusk, Scünci and Babyliss lines, among others. With its main production facilities in Asia, it is also a participant in the Customs Trade Partnership Against Terrorism (CTPAT) program.
In 2003, Walmart asked its 100 top suppliers, including Conair, to begin applying RFID tags to all cases and pallets of products supplied to its stores. At about the same time, the U.S. Department of Homeland Security (DHS) asked Conair for its insights on improving container and port security, based on the amount of international shipping it conducts.
Realizing the importance of Walmart and secure international shipping to its future, Conair did more than simply respond to these requests: The company took an innovative approach and created an entirely separate entity -- United Security Applications ID (USA ID) -- to focus on the development of supply-chain and security applications that could be used to improve its own processes, as well as meet the needs of Walmart and DHS.
This business strategy would enable Conair to meet customer requirements, and realize supply-chain efficiency gains and the associated cost savings that it had deduced were possible with RFID-enabled processes.
Putting the Plan into Action
Conair began with item-level tagging in the Cuisinart and Waring lines -- even though this was above and beyond Walmart's request to begin tagging at the pallet and case level -- because they could see that item-level tagging with EPC-enabled RFID could generate actionable data.
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