July 31, 2003 – As more retailers look to track their shipped goods with RFID tags, suppliers are being forced to invest in RFID equipment. But at least one supplier, the Geest Group of Companies in England, which provides fresh produce to Marks & Spencer, is realizing that the added cost is also an opportunity.
“Marks & Spencer’s decision meant a capital outlay for us with regard to buying the RFID equipment,” says Jackie Brown, Geest’s planning manager, “but we are certainly expecting to see benefits as well.”
Marks & Spencer, one of the UK’s largest retailers, has been putting RFID tags on four million reusable trays used by more than 200 of its suppliers. The goal is to improve supply chain speed and reduce errors. The suppliers, therefore, have to invest in readers that can scan the tags and write data to the tags.
The RFID tags replace a card file system. Suppliers used to write information about a shipment—the tray’s contents and how long the produce should be displayed in the store—on a card and place it in the tray along with the goods being shipped to M&S. The cards often got lost or damaged.
The same data will now be written to RFID tags on the tray. Marks & Spencer decided to use 13.56 MHz read/write tags from Texas Instruments. By installing readers at its loading docks, the retailer can automatically record having received the trays. Portal readers can simultaneously read all the data from tags on trays stacked on a dolly.
Unlike the cards, RFID is not susceptible to in-transit damage, weather and other factors, ensuring the data stays with the contents until the tag is overwritten. Systems can be set up to scan tags and match the shipment to an M&S order. That can mean significant savings for Geest.
At present, M&S charges suppliers £100 (US$162) a week for each depot that ships the wrong goods to the retailer ordered. Since the goods are perishable and can’t be sent to another supplier, Geest loses the value of the products and the profits on the goods, Brown says.
The Geest Group of Companies comprises Bourne Stir Fry, Geest QV, Caledonian Produce, Tilmanstone Salads, Geest Prepared Foods, World Wide Fruit and English Village Salads. Each of these companies is deploying RFID in its distribution center. The implementations should be completed by the second quarter of 2004.
Each individual company within the group will choose the equipment that best fits into existing warehouse systems and processes. The design and readers of each company’s RFID system will be provided by Intellident, based in Manchester.
In one of its companies’ distribution centers, Geest deployed Intellident portal readers, which can read and write to multiple RFID tags simultaneously. Trays, which are stacked nine high on dollies, pass through the portal at the loading dock. “There are huge benefits in the speed that we can load and dispatch our products,” says Brown. “We can write and verify [the accuracy of an order with] 18 trays in a matter of seconds.”
At another Geest facility, where the production process makes it better to write data to the tags on the trays as the trays full of produce come off the production line, the company is using Intellident’s Production LineWriter, which can be integrated into conveyor belts, roller beds, packing/filling lines and other pick and pack processes.
Geest is also looking at ways that each of its companies could link its new RFID equipment into its planning system to give greater shop floor visibility. Further benefits could come from using RFID to understand where there is any downtime in current operations, says Brown.
The systems don’t affect the supplier’s ability to deliver to other retailers, but if other retailers choose different RFID technology, that would man additional expenses for Geest. “I suppose there will be an issue of money if another retailer uses different software,” says Brown, “as this would require more money spent on different kits.”