Rfid At Metro Group Case 2e581s

Ashutosh Singh (4018/20)

RFID at the METRO Group Some of the major benefits of RFID (Radio frequency Identification) technology area. b. c. d.

Reducing Shrink in the supply chain. Improving on-shelf availability and reducing out-of-stocks. Improving Planogram and Promotion compliance. Productivity and labor efficiencies.

RFID technology is basically a new technology, and still under growth, with lots of potential. It can provide a basket of benefits, as written above to various verticals of industry. Lots of innovation still is required for this technology to achieve a maximum level, so that it can provide us with maximum benefits. Not investing in RFID technology because it is not mature enough is not at all a good idea. This technology with proper applications can create a revolution in Retail market. Companies which are using RFID technology are having an edge over others, and in the near future this benefit edge will increase three folds. Some of the potential benefits in Metro’s grocery supply chain area. Using Pallet-Level tagging to improve truck loading Process at the manufacturer’s warehouse. b. Using case-level tagging to improve mixed- Pallet Picking at Metro DCs. c. Using case-level tagging to Improve Shelf Restocking at stores. RFID technology is currently in development phase, and standards for its usage are still under construction. Metro can do a detail analysis at this level and list out the benefits as well as cons of this technology. The detailed research done will bring down the cost of the RFID tags, and hence the companies will become more and more interested in this technology, when they will see its benefits. Hence, Metro is right in investing in this technology. Barcodes have some major weaknesses which can be solved by the usage of RFID. Few of the weaknesses of using barcodes area. Security - Barcode can easily be duplicated so security is an issue. Contrast to this, RFID is very difficult to replicate and thus can be used in few of the costlier items. b. Difficulty to read the bar codes - Individual checking of barcodes requires intervention of people which makes it costly as well as time consuming. Contrast to this, RFID can be read very easily, need not be from a particular direction and there are tags which can be read from just ing under a scanning machine, thus

Ashutosh Singh (4018/20)

c.

d.

e. f. g. h.

enabling automatic tracking of shipments as well as saving lot of time. Thus RFID plays a major role in Logistics, helping in keeping track of the material. Information that can be stored in bar codes is very limited. It can store only a few basic information. E.g. all products of same type have same barcode. In contrast to this RFID tags have a detailed information of each and every item. RFID tag can have different values for different items of same type and it can also be tracked. Thus products with RFID tags can easily be tracked and information can be gathered. Major advantage of RFID is in logistics where shipments can be automatically tracked and monitored. Thus a company can know through which route the product goes during its life cycle, and thus can deduce the further plan accordingly. Theft can easily be tracked. While Barcodes can’t be used for tracking purposes. Barcodes can easily be damaged, while RFID tags are much more secure in this aspect. RFID usage can lead to attaining higher levels of automation, thus selling of products will become easier in the future. This is not possible in case of Barcodes. Inventory management – Through the use of real time data, inventory management becomes easier when using RFID tags. Cost Effective Management of shelf space can be done through the usage of RFID tags.

RFID tags cannot be replaced by barcodes even with technological advances, because RFID tags feature a lot of advantages over Barcodes. As a METRO’s competitor I would try to suppress the advantage that Metro possess through the introduction of this new technology. RFID has a lot of potential to rule the tracking and Retail market, and in the near future can easily expand to other horizons. Seeing this opportunity I will set up a Research Lab of my own, in my own firm and invest in this technology, trying to gain insights on what areas this technology can benefit. But my major goal will be to target Retail market, how will this technology affect retail sector (tracking and logistics). I would also try to find out the benefits that customers, and retail stores will draw from this technology. And when we gather the details on how this technology is beneficiary, I would try to leverage this market, by setting up concept similar to Future store started by METRO. Also I would tie hands with a few RFID manufacturers.