Trials of RFID technology at Procter & Gamble have produced benefits but not the breakthrough required to demonstrate true value, said global customer ebusiness director Milan Turk.
Speaking at the Global Retail Technology Forum in Barcelona this week, Turk said the focus was on validating the business case. “Pilots must drive towards specific lessons and success,” he said.
Turk’s comments came a week after Nestlé business technology manager Paul Roberts said retailers needed to demonstrate the benefits of RFID for suppliers (The Grocer, March 6, p4).
P& G has conducted in-house pilots to test the performance of electronic product codes which will replace barcodes in RFID applications, at pallet and case level. This included running cases and pallets on a conveyor belt at different speeds and with different reader arrangements.
The tests showed that speed had an impact on the ability of the readers to catch the tags, said Turk. However, the most critical issue was packaging and product make-up. Paper products like Charmin performed well in terms of reader recognition of codes, with liquid product Pantene shampoo and washing powder Tide performing less well. Granule dishwasher Cascade, packed in foil to prevent corrosion, barely functioned at all.
Turk said the technology was also incapable of auditing mixed pallets or multiple cases on a pallet but “with the correct reader configuration and within the speeds tested, it could read any single case in a single file on a conveyor, or any single pallet tag through a dock door”.
The cost of tags was also hindering return on investment, he said. “We need a cost per tag below five cents to enable value at pallet and case level and of one cent for use at item level.”
Despite this, when asked why P&G was continuing to support RFID and EPC when there was no evidence of return on investment yet, Turk said it did not want to sit waiting on the sidelines. “P&G is driven by innovation. The small business benefit is significant enough to show the capability to expect much more.” He said the true benefit would come with item level tagging.
Siân Harrington in Barcelona
Speaking at the Global Retail Technology Forum in Barcelona this week, Turk said the focus was on validating the business case. “Pilots must drive towards specific lessons and success,” he said.
Turk’s comments came a week after Nestlé business technology manager Paul Roberts said retailers needed to demonstrate the benefits of RFID for suppliers (The Grocer, March 6, p4).
P& G has conducted in-house pilots to test the performance of electronic product codes which will replace barcodes in RFID applications, at pallet and case level. This included running cases and pallets on a conveyor belt at different speeds and with different reader arrangements.
The tests showed that speed had an impact on the ability of the readers to catch the tags, said Turk. However, the most critical issue was packaging and product make-up. Paper products like Charmin performed well in terms of reader recognition of codes, with liquid product Pantene shampoo and washing powder Tide performing less well. Granule dishwasher Cascade, packed in foil to prevent corrosion, barely functioned at all.
Turk said the technology was also incapable of auditing mixed pallets or multiple cases on a pallet but “with the correct reader configuration and within the speeds tested, it could read any single case in a single file on a conveyor, or any single pallet tag through a dock door”.
The cost of tags was also hindering return on investment, he said. “We need a cost per tag below five cents to enable value at pallet and case level and of one cent for use at item level.”
Despite this, when asked why P&G was continuing to support RFID and EPC when there was no evidence of return on investment yet, Turk said it did not want to sit waiting on the sidelines. “P&G is driven by innovation. The small business benefit is significant enough to show the capability to expect much more.” He said the true benefit would come with item level tagging.
Siân Harrington in Barcelona
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