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Tracking Products to Thwart Thieves

To reduce losses and boost efficiency, Woolworths has launched a pilot that uses RFID and other technologies to track products through the supply chain.
Dec 09, 2002Dec. 9, 2002 - Geoff O'Neill is something of a pioneer. Back in 1999 -- before the Auto-ID Center, before the talk of a five-cent tag, before most people had even heard of RFID -- the head of central logistics for new sales channels at the Woolworths implemented one of the first systems for tracking individual products. The project, which involved tagging clothing moving from a distribution center to a single store, was not a huge success. The tags were too expensive, too unreliable and didn't provide the read range the company needed.


The UK chain is cutting its losses
But O'Neill didn't give up on RFID. He realized it had great potential to enable Woolworths to reduce stock levels, boost the accuracy of orders shipped to stores and cut theft of goods in transit. When the U.K. government's Home Office launched its Chipping of Goods initiative in May 2000, O'Neill saw an opportunity to give RFID another try. With part funding from the U.K. government, he designed a system that enables the company to track products from the time they leave the distribution center until the time they arrive at a specific store.

Although the Chipping of Goods initiatives focuses on reducing theft, Woolworths wanted to see not just if RFID could reduce supply chain shrinkage, but also if it could improve the availability of product in the stores while simultaneously reducing inventory levels. The company hired Integrated Product Intelligence, a London-based professional services company, to manage the development and implementation phases.

IPI worked with the prime contractor on the project, Microlise, a supply chain technology provider, and Savi Technology, which provided tags, readers and software. The aim was to ensure the proposed solution added value to the Woolworths operation. The system would also have to demonstrate that RFID could help the company more effectively manage distribution assets and identify theft and mis-deliveries as they occur in real time.

The pilot is about to go live and the data will be collected through April 2003 when Woolworths will make a report to the Home Office on the results of the project. The company will then evaluate the technology internally. O'Neill says he is confident the system will achieve the objectives. "If you know what you have and where it is and people know it is being tracked, there is less likelihood of it being taken," he says. "We also have to look into the process issues that go wrong, the mistakes that are made. The system prevents those from happen on a real-time basis."

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