Introduction to RFID Inventory Management in Retail

Radio Frequency Identification - RFID is an established data-carrying and automatic identification technology used throughout industry, and in the retail sector, has long been touted as the Holy Grail of Inventory Management. I can remember a conversation I had with one of the IT Directors of Tesco who said to me '..whichever Retailer cracks RFID first, wins. Period'. Dramatic words indeed.

Within Retail, think of RFID as an Intelligent barcode. Intelligent because it not only identifies the product, but it uniquely identifies the product. ie I'm not just a 300g tin of beans, I'm 300g tin of beans number 54167. It can do this because data relating to the specific item is stored on the RFID tag which is attached to the item. Like a bar code, a tag is a data carrier. A bar code carries data in a visible symbol and is read by a bar code scanner using optical or infrared wavelengths. An RFID tag carries data programmed into a small computer chip and operates at a wide range of radio frequencies.

The tag is activated by radio waves emitted from an RFID reader. The reader communicates wirelessly with the tag across what is known as the air-interface. Once activated, the tag sends data stored in its memory relating to the item back to the reader.

The RFID readers vary in the range at which they can read the RFID tags. This starts from the tap and go type readers which operate at the 0 - 1cm range, think TFL Oyster card, where you tap the card on to a reader (Interestingly such system are called contactless, despite the need to touch them to the reader). This area of RFID isn't really suitable for Inventory Management and is being explored more as a quick payment method.

Long range RFID scanners can pick up tags at range's up to 200m, and its these long and medium range scanners that open up the opportunity within warehouses and store backrooms for automatic inventory counting, goods in scanning etc. Imagine being able to take in a delivery from a supplier and automatically know each individual product that is on the pallet.

Aside from the infrastructure and setup challenges associated with an RFID solution, is the challenge of what to do with all that data. The increase in data volumes associated with a change in supply chain management from pallets to individual items is huge. I've worked at 4 out of the top 5 UK retailers and they all have enterprise datawarehouses measured in the 10's of Terabytes, driven by holding data mostly at SKU level. (Some of the data held will be at transaction level, which is almost individual item level, but the volumes of this typically range in the 0 - 5% of total space utilisation). To change the granularity to be at individual RFID rather than SKU is to scale that volume by a rough factor of 10,000. (based on 1000 stores and 10 incidences of each item per store).

The data challenge for RFID Inventory Management therefore becomes how to cope with a new level granularity, which systems need to use it, how they talk to other systems, how to cope with the increased network and storage requirements.

Grapes are a vines babies

A thought occurred to me yesterday while I was working with my operations team on a reasonably complex data issue. We were waiting for the results of a program to come back and I was nibbling at the grapes in the company fruit bowl. For those of you that don't have office based lives, the latest must have accessory is company provided fruit. Fresh fruit is delivered to the office every other day, and staff get to munch for free. It's a HR thing aimed at us all leading healthier lives. I'm all for it.

So I'm sitting there eating grapes, big fat juicy seedless grapes, the best sort. I felt a bit guilty that they'd come in from Kenya via Air freight, not so environmentally friendly, and I felt my carbon footprint flex ever so slightly.

I'm eating grapes and suddenly the thought occurs to me, that these grapes are the vines babies. Grapes are the equivalent of eggs surely. The plant-world equivalent of an unborn foetus.

I'm not a vegetarian. I eat meat and dairy, so really this shouldn't matter should it. Milk is not the innocent white-coloured water we pour over cereals, but the fluid used by a mother cow to feed baby calves. Eggs are unborn chicks.

If vegetarians don't eat meat and vegans don't eat meat or dairy. What do you call someone who doesn't eat meat, dairy or fruit and vegetables??

Answers on a postcard...

The True Cost of Cheap Food

A dispatches investigation into how the supermarkets are cashing in on the credit crunch by encouraging the trading down to own label value lines.


I find myself drawn naturally to programs that slag supermarkets off (we all know it's fashionable to be anti-supermarket). I've worked in retail for more than 15 years, including more than 11 years working for an international retailer, so as a retail expert, you could say it's part of my job to keep an eye on programmes like this. I find myself usually both agreeing and disagreeing to the various points in the show, and the degree to which this happens depends greatly on the quality of the show.


This particular program is better than many other 'supermarkets are really bad' type shows. It was full of stats, many of which I captured and I've documented at the end of the post, and it's main point was that cheap food can be improved very easily and very cheaply, usually for less than 1 pence per sausage/apple pie/cheese slice.


It suggested that supermarkets should improve the quality and take the hit on their own margin. I'm not sure I agree with that and given that we're only talking about increasing the price of a pack of 8 value sausages by 8 pence, why should they. However, since that 8 pence produces a significantly better product, I rather think the show should have stressed the point that supermarkets should wherever possible, provide the best quality product. They're allowed to make a profit out of it.


I'm toying with the idea of doing a Hugh Fearnley-Whittingstall and raising a motion at the Tesco AGM to force them to improve the quality of their sausages. If enough people comment on this post in favour of this action I'll do it. Pass this on to your friends...


Now for the stats

Beef Burgers
How much protein is their in premium vs economy burgers?? grams protein per 100g

Asda - premium 23, economy 20
Tesco - premium 23, economy 19
Iceland - premium 25, economy 18

Tomatoes
How much of the anti-oxidant lycopene in premium vs economy tomatoes??

Tesco - premium 5.5, economy 3.4
Asda - premium 6.5, economy 3.6
Sainsburys - premium 5.2, economy 3.6
Morrisons - premium 5.1, economy 4.1
Aldi - premium 5.1, economy 3.4
Lidl - economy 3.8
Iceland - premium 5.5, economy 3.3

Chicken breasts
The percentage of meat in chicken breasts.

Asda - 82%
Iceland - 85%
Morrisons - 88%
Tesco - 84%

The remaining percentage is made up of varying combinations of the following water, salt, stabilisers, dextrose, polyphosphate and liquid glucose.

Sausages
The percentage of protein in a sausage. (protein is an indication of meat content)

Tesco - premium 15.8, economy 11.2
Asda - n/a
Morrisons - premium14.3, economy 9.0
Sainsburys - premium 15.3, economy 8.3
Iceland - premium 12.0, economy 11.6
Aldi - n/a
Lidl - premium 15.3, economy 12.9