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Toshiba Boasts Strong ROI for Large RFID System

TOSHIBA TEC Europe has implemented an RFID system to track notebook computers at its facility in Regensburg, Germany. The company claims it is the largest RFID implementation in Europe, with 2 million tags processed after seven months. Toshiba reports it has reduced handling time by 75 percent and cut associated costs by 40 percent.
May 18, 2007This article was originally published by RFID Update.

May 18, 2007—TOSHIBA TEC Europe (TERIS) has reported strong return on investment (ROI) after just seven months in what it claims is Europe's largest RFID implementation. The company installed an RFID tracking system at its notebook PC configuration plant in Regensburg, Germany. The system, which features Gen2 RFID tags from UPM Raflatac and equipment from Tyco/ADT, tracks notebook computers through storage and distribution processes. The accurate information it provides helps TERIS coordinate sales efforts with inventory and meet growing demand for its products.

"Implementing this solution is showing that RFID can provide tangible benefits for manufacturers in their processes without the need for customer mandates to drive RFID adoption," said Andreas Unterbusch, RFID project manager at TOSHIBA TEC. "Because all the notebooks are individually tagged, future expected requirements from retailers are already in place."

The application is an example of benefiting from RFID by using it to create special processes and workflows, an approach AMR Research Analyst John Fontanella recently advocated in an RFID Update opinion article (see RFID to Enable Outside-In Supply Chain Management).

Individually tagged notebook PCs are loaded onto pallets for storage prior to distribution. Pallets are passed through RFID gates, which records each individual notebook being placed into storage. Accuracy is 99.997 percent. Toshiba reported the system has reduced handling time by 75 percent and eliminated a previous bottleneck in transferring finished goods from production to storage. The result is a 40 percent reduction in booking costs per unit.

Toshiba said two million RFID tags were used in the first seven months of the system and that daily throughput increased 81 percent to more than 17,000 notebooks per day. The company reported that throughput and the business benefits from RFID have both exceeded expectations.

Toshiba's results are similar to those Sony Europe reported for its consumer electronics warehouse in Tilburg, the Netherlands (see Sony Europe Finds ROI with RFID Deployment). Sony said its expects full ROI in less than a year for its warehouse system, which features item-level tagging of digital cameras, televisions, and other consumer goods sold by retailers in Germany.
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