Exel is launching a major trial of Radio Frequency Identification (RFID) technology.
Fresh from a limited trial of RFID with UK retailer Selfridges, Exel is about to begin another trial of the technology with House of Fraser. But whereas the Selfridges trial was restricted to the tracking of vehicles and containers in the UK, the House of Fraser trial, ‘Project China’, pushes the technology further by tracking individual garments from the retailer’s own brand manufacturers in China. This will bring Exel a step closer to realizing the full possibilities that RFID offers.
RFID technology works through the use of tags and readers, similar in principle to barcode technology. RFID tags can be embedded or attached to containers, cases and even the individual products they contain. RFID readers, fixed in place or hand-held by warehouse or store staff, pick up signals from the tags providing details about the identity and origin of the product or medium they are attached to.
In a store this means that, with readers placed around the shop and in the backroom, a manager can have real-time visibility of exactly where tagged products are. This can avert empty shelves and so reduce the number of lost sales caused by stock failing to make the final few yards from the backroom to the shelf.
But if the potential advantages of RFID are almost too many to describe, there are also a host of practical constraints that have served, so far, to dampen the excitement. Cost is a key issue – whether it is the price of the tags, the readers needed to interrogate them, or the work needed to integrate the technology with manufacturers and retailers’ existing systems. Another issue is the torrent of additional data from all of these tags, which CIOs fear would deluge their IT systems.
With giant retailers like Wal-Mart [WMT] and Tesco [TSCO.L] pressing ahead with RFID, however, it seems safe to assume that there exists the will to overcome such hurdles and capture the technology’s potential.
