Tesco is embarking on a major roll out of RFID in its supply chain with plans to install readers across its entire depot and store network by the end of the year.
Under a deal struck with electronic security systems expert ADT, Tesco will install 4,000 RFID readers and 16,000 antennae at despatch points across 30 depots and goods-receipt points at 1,400 stores.
The move follows successful trials on plastic totes and wheeled dollies for high-value lines between one of Tesco’s RDCs and 14 stores. As part of Tesco’s secure supply chain initiative - a closed loop between depots and stores - the dollies are scanned on despatch from the depot and scanned again on receipt at the store, giving accurate and immediate data on their whereabouts.
IT director Colin Cobain said that further deployments could include the Tesco’s international operations. However, the details of when suppliers will be expected to start tagging cases or reusable containers heading for Tesco’s depots have still not been disclosed.
A statement on Tesco’s new radio-barcoding web site says: “Due to delays in certain standards being ratified, we have modified our case level supplier roll-out plans. We now expect to
start this with products that are delivered to Tesco in reusable containers in the second quarter.” However, all suppliers have been assured that they will get a six-month warning before being asked to start tagging goods.
In the meantime, Tesco is working with a hard core of key suppliers to test the technology and build a business case.
However, many suppliers were still struggling to justify the expense of tagging goods for a single customer, which would in some cases involve major changes to processes, said Deloitte UK head of RFID Tony Hodgson. “What Tesco seems to be trying to show through trials with suppliers and setting up a supplier working group, rather than issuing a mandate, is that it is trying to take a more collaborative approach.
He added: “Suppliers are constantly told that ‘slap and ship’ is no good if they want to get the real benefits for RFID, but the costs are significant.”
Elaine Watson