By: Stan A. Szlapetis Director of Software Services RFID

By: Stan A. SzlapetisBy: Stan A. SzlapetisDirector of Software ServicesDirector of Software Services

RFIDRFID

By: Stan A. SzlapetisDirector of Software Services

AgendaAgenda

What is RFIDWhat is RFID History of RFIDHistory of RFID How is RFID Used and by WhomHow is RFID Used and by Whom RFID In DistributionRFID In Distribution RFID BasicsRFID Basics RFID Tags and EquipmentRFID Tags and Equipment EPC Global EPC Global


What is RFIDWhat is RFID

Radio Frequency IdentificationRadio Frequency Identification ““Smart Label”Smart Label”


RFID HistoryRFID History

Developed in 1940’sDeveloped in 1940’s Commercialized in early 1980’sCommercialized in early 1980’s Smart Labels introduced in late Smart Labels introduced in late

1990’s1990’s EPCglobal US™ was formed in 2003EPCglobal US™ was formed in 2003 Significant supply chain utilization Significant supply chain utilization

20042004


RFID ApplicationsRFID Applications MilitaryMilitary Livestock TrackingLivestock Tracking Industrial/Production Process Industrial/Production Process Sortation Systems (Travel & Post)Sortation Systems (Travel & Post) Access ControlAccess Control Pharmaceutical Electronic Pedigree Pharmaceutical Electronic Pedigree Asset TrackingAsset Tracking Supply Chain/DistributionSupply Chain/Distribution


Real Customer RFID Real Customer RFID DeploymentDeployment

Manufacturing and Item Level TaggingManufacturing and Item Level Tagging Purdue, HD Smith, Astra-ZenicaPurdue, HD Smith, Astra-Zenica

Industrial ManufacturingIndustrial Manufacturing Pacific Cycle, Boeing, International PaperPacific Cycle, Boeing, International Paper

Supply Chain and RetailSupply Chain and Retail Wal-Mart, Target, Albertsons, Sam’s ClubWal-Mart, Target, Albertsons, Sam’s Club

Routing and Sortation Routing and Sortation (luggage & parcels)(luggage & parcels) Virgin Atlantic, Hong Kong Intl AirportVirgin Atlantic, Hong Kong Intl Airport


Retail Supply Chain RFID Retail Supply Chain RFID Adopters Adopters

Wal-MartWal-Mart Target Target AlbertsonsAlbertsons CCECCE Price ClubPrice Club


Example of RFID Example of RFID ImplementationImplementation

You instantly know exactly

what you have.

Store Staging Area. (or palletizing)

You already know who’s waiting for it.

You instantly verify what goes out.

You instantly confirm what you received and the the store has it.

When a case serial # is

scrapped, you know it’s on the

shelf.

Exception Lane.

More reliable reading minimizes work in this area.

Receiving Area

(from production or from suppliers)


Advantages over Similar Advantages over Similar Barcode SystemsBarcode Systems

All RFID tags are read on the pallet at All RFID tags are read on the pallet at once* once*

Save time in scanning each box individually Save time in scanning each box individually as you would with barcodesas you would with barcodes

Handles variable size boxes more Handles variable size boxes more effectively than scanner based systemeffectively than scanner based system

Less sensitive to label orientationLess sensitive to label orientation

* Theoretically – some products may be more difficult to read than others* Theoretically – some products may be more difficult to read than others


Benefits of RFID in Benefits of RFID in DistributionDistribution

Reduce laborReduce labor Smart shelves tell you when Smart shelves tell you when

you’re out of stockyou’re out of stock Reduce theftReduce theft Full visibility through supply chainFull visibility through supply chain Reduce Inventory (safety stock)Reduce Inventory (safety stock) Certification of authenticityCertification of authenticity


Wal-Mart OverviewWal-Mart Overview

Supplier Wal-Mart DC

Wal-Mart Store 1

Wal-Mart Store 2

Wal-Mart Store 3

Retail Link


RFID In The WarehouseRFID In The Warehouse


RFID StandardsRFID Standards

Several Application & Communication Several Application & Communication Standards ExistStandards Exist

Tracking AnimalsTracking Animals Smart CardSmart Card EPC Global Gen 1 & Gen 2EPC Global Gen 1 & Gen 2 ISO 18000-3 (HF)ISO 18000-3 (HF) ISO 18000-6 A/B (UHF)ISO 18000-6 A/B (UHF)

Wal-Mart Adopted EPC StandardWal-Mart Adopted EPC Standard


Difference between ISO and Difference between ISO and EPCEPC

The Electronic Product Code (EPC) is a standard The Electronic Product Code (EPC) is a standard created by EPCglobal. created by EPCglobal.

EPC is more than tags and reader communication. EPC is more than tags and reader communication. EPCglobal wants a network standard for how data EPCglobal wants a network standard for how data is shared among various organizations.is shared among various organizations.

ISO is also working on standards for tracking ISO is also working on standards for tracking goods in the supply chain using HF and UHF tagsgoods in the supply chain using HF and UHF tags

It is envisioned that EPC standard will also It is envisioned that EPC standard will also become ISO 18000-6C standardbecome ISO 18000-6C standard


RFID Tag BasicsRFID Tag Basics

An RFID tag contains a small Chip An RFID tag contains a small Chip (computer, memory, radio, and power) (computer, memory, radio, and power) and Antennas, mounted on a Substrateand Antennas, mounted on a Substrate

Active, Semi-Passive, or PassiveActive, Semi-Passive, or Passive Single or Double DipoleSingle or Double Dipole Read/Write, Write Once/Read Many, Read/Write, Write Once/Read Many,

Read-OnlyRead-Only


Common FrequenciesCommon Frequencies

Low Frequency (125 and 134.2 kHz)Low Frequency (125 and 134.2 kHz) High Frequency (13.56 MHz)High Frequency (13.56 MHz) Ultra High Frequency* (865-869 MHz Ultra High Frequency* (865-869 MHz

in Europe, 902-928 MHz in US, 905-in Europe, 902-928 MHz in US, 905-956 MHz in Japan)956 MHz in Japan)

Microwave (2.54 GHz and 5.8 GHz)Microwave (2.54 GHz and 5.8 GHz)

* EPC Gen 2 Frequency Range* EPC Gen 2 Frequency Range


Active & Passive TagsActive & Passive Tags

Passive RFID requires reader to Passive RFID requires reader to create an RF field that energizes the create an RF field that energizes the tag for communication (reader talks tag for communication (reader talks first)first)

Active RFID requires the tag to have Active RFID requires the tag to have it’s own power and normally the tag it’s own power and normally the tag broadcasts it’s presence to the reader broadcasts it’s presence to the reader first (tag talks first)first (tag talks first)


EPC Tag ClassesEPC Tag ClassesCLASS TAG CAPABILITY

Class 0 Read Only (64 or 96 bits)

Class 1 Write Once, Read Many (64 or 96 bits)

Class 0+,Class 2

Read, Write (96 or 256 or 512 bits)

Class 3Class 2 Capabilities + Power for longer

range or advanced functions.

Class 4Class 3 Capabilities + Ability to

communicate with other active tags.

Class 5Class 4 Capabilities + Ability to

communicate with passive tags.


Generation 2 Generation 2 CharacteristicsCharacteristics

Single world wide standardSingle world wide standard Less power to power the tag up (more time, longer Less power to power the tag up (more time, longer

reader distance)reader distance) Faster tag to reader communicationFaster tag to reader communication Improved write speed (5 tags/sec vs. 3)Improved write speed (5 tags/sec vs. 3) Improved singulation protocol (“Q” Protocol)Improved singulation protocol (“Q” Protocol) Encryption of tag to reader communicationEncryption of tag to reader communication Dense reader operationDense reader operation Up to 512 bit item ID (vs. 96 bit item ID)Up to 512 bit item ID (vs. 96 bit item ID) 32 bit lock and kill password (vs. 8 bit)32 bit lock and kill password (vs. 8 bit)


RFID vs. BarcodeRFID vs. Barcode

BARCODE RFID

Optical, line of sight required

Wireless, no line of sight required

Reads one object at a time

Read many objects at once

Changes require a new label to be printed

Changes can be reprogrammed on the fly

Labels are less expensive

Tags are more expensive


Mapping Barcodes to EPC Mapping Barcodes to EPC GTINGTIN


RFID TagsRFID TagsREAD ONLY AND

READ/WRITEINLAYS FOR PALLET

TAGS INLAYS FOR CASEINLAYS FOR ITEM TAGS

Best Best PerformancePerformance

4x44x4 1x61x6 2 x 22 x 2

Better Better PerformancePerformance

3x33x3 2x42x4 1x41x4

Good Good PerformancePerformance

1x6 1x6 1x4 1x4 1x11x1


RFID EquipmentRFID Equipment


RD5000 ReaderRD5000 Reader Compact, Rugged, PortableCompact, Rugged, Portable Can be installed almost Can be installed almost

anywhere on material handling anywhere on material handling equipment such as forklifts and equipment such as forklifts and clamp trucks, on mobile carts, clamp trucks, on mobile carts, portable skate wheel conveyors portable skate wheel conveyors or even in hard to reach or even in hard to reach locations where a cabled fixed locations where a cabled fixed reader would not be practical. reader would not be practical.

EPC Gen 2 OnlyEPC Gen 2 Only

Features100% free of network, power and

antenna cables

Integrated 802.11a/b/g WLAN radios

Integrated Bluetooth

Integrated rugged antenna

Integrated battery with optional external power source

Interactive sensing technologies: acceleration sensor and proximity sensor

IP66 sealing

MC9000 series compatible battery and chargers


XR400 Smart ReaderXR400 Smart Reader

Simultaneous support for EPC Gen 1 & Gen 2 tagsSimultaneous support for EPC Gen 1 & Gen 2 tags Hosts applications directly on the readerHosts applications directly on the reader Enterprise connectivity (Ethernet, Serial, USB, Enterprise connectivity (Ethernet, Serial, USB,

digital I/O) & Remote Managementdigital I/O) & Remote Management Up to 4 read pointsUp to 4 read points Best in class reader performanceBest in class reader performance Best in class dense reader performanceBest in class dense reader performance Reads as well as writes to tagsReads as well as writes to tags


XR400 Smart Reader XR400 Smart Reader ApplicationsApplications

Conveyor ReadersConveyor Readers Forklift ReadersForklift Readers Dock Door ReadersDock Door Readers


Reader Forklift MountReader Forklift Mount

Forklift still needs a RF terminal with a Forklift still needs a RF terminal with a display for commands and directiondisplay for commands and direction


DC600 Advanced Portal DC600 Advanced Portal System System

Turn-key solutionTurn-key solution Integrated XR400 Reader and Integrated XR400 Reader and

High performance antennasHigh performance antennas Enterprise deployableEnterprise deployable Easy to install, manage and Easy to install, manage and

maintainmaintain ModularModular Audio & visual alertsAudio & visual alerts


MC9000-G RFID Rugged MC9000-G RFID Rugged HandheldHandheld

¼ VGA Display¼ VGA Display Variable Distance Barcode Variable Distance Barcode

ReaderReader EPC Class 0, 1 & Gen 2 EPC Class 0, 1 & Gen 2

Compliant RFID ReaderCompliant RFID Reader Integrated Directional Antenna Integrated Directional Antenna 802.11b Connectivity802.11b Connectivity ProgrammableProgrammable Microsoft Windows CE.NET, Microsoft Windows CE.NET,

Microsoft Mobile 2003Microsoft Mobile 2003


PrintingPrinting Number of printers and Number of printers and

printer/applicators are available on the printer/applicators are available on the market that print, encode and verify market that print, encode and verify RFID labelsRFID labels

Toshiba TEC offers 4 RFID Ready Toshiba TEC offers 4 RFID Ready Thermal Printers: BSX-4, BSX-5, BSX-Thermal Printers: BSX-4, BSX-5, BSX-8 and the B-SA4.8 and the B-SA4.

Can print and encode HF or UHF tagsCan print and encode HF or UHF tags Toshiba TEC has successfully used Toshiba TEC has successfully used

back-scatter UHF in R/W tests.back-scatter UHF in R/W tests. Ribbon Save, BCI and the RFID Ribbon Save, BCI and the RFID

Analyze Tool are unique to Toshiba Analyze Tool are unique to Toshiba TEC.TEC.


EPC GlobalEPC Global

EPCglobal Inc™ is a joint venture of GS1 US™ EPCglobal Inc™ is a joint venture of GS1 US™ (formerly the Uniform Code Council, Inc.®) and (formerly the Uniform Code Council, Inc.®) and GS1 (formerly EAN International)GS1 (formerly EAN International)

Committed to standards-based global supply chain Committed to standards-based global supply chain solutionssolutions

EPCglobal Inc is an open, worldwide, not-for-profit EPCglobal Inc is an open, worldwide, not-for-profit consortium of supply chain partners working to consortium of supply chain partners working to drive global adoption of the EPCglobal Network™. drive global adoption of the EPCglobal Network™.

EPCglobal Network will provide for immediate, EPCglobal Network will provide for immediate, automatic and accurate identification of any item in automatic and accurate identification of any item in the supply chain of any company, in any industry, the supply chain of any company, in any industry, anywhere in the world.anywhere in the world.


EPCglobal Inc™ StandardEPCglobal Inc™ Standard

EPC deals with more than just how EPC deals with more than just how tags and readers communicate. tags and readers communicate.

Create network standards to govern Create network standards to govern how EPC data is shared among how EPC data is shared among companies and other organizationscompanies and other organizations


Data ExchangeData Exchange

Data synchronization is required Data synchronization is required through the GS1 – Global Data through the GS1 – Global Data Synchronization Network (GDSN)Synchronization Network (GDSN)

Tags must be in EPC Data FormatTags must be in EPC Data Format UCCnet is Wal-Mart’s network partnerUCCnet is Wal-Mart’s network partner


What is GDSNWhat is GDSN

GDSN performs 3 key functions:GDSN performs 3 key functions: Item RegistryItem Registry Standards ValidationStandards Validation Data Synchronization of Item DataData Synchronization of Item Data


Purpose of GDSNPurpose of GDSN


Benefits of GDSNBenefits of GDSN

Eliminates re-keying of dataEliminates re-keying of data Maintains accuracy of dataMaintains accuracy of data Sets StandardsSets Standards Speeds Up Item Introduction and CreationSpeeds Up Item Introduction and Creation Wide scope RFID Identification of ItemsWide scope RFID Identification of Items Delivers Trade Item data in consistent Delivers Trade Item data in consistent

formatformat Simplifies Supply Chain ManagementSimplifies Supply Chain Management


Wal-Mart’s Retail LinkWal-Mart’s Retail Link

Wal-Mart will NOT use the EPC Wal-Mart will NOT use the EPC Network at this timeNetwork at this time

Wal-Mart will use Retail LinkWal-Mart will use Retail Link Primary method for sharing EPC Primary method for sharing EPC

informationinformation Allows Suppliers to see the same Allows Suppliers to see the same

information that Buyers and information that Buyers and Replenishment Managers can seeReplenishment Managers can see


Automation AssociatesAutomation Associates

RFID Technology is not perfect but great strides are being made

AAI is Symbol RFID certified Ready to help you with your RFID

project


TerminologyTerminology

EPC – Electronic Product CodeEPC – Electronic Product Code GTIN – Global Trade Item NumberGTIN – Global Trade Item Number SGTIN – Serialize GTINSGTIN – Serialize GTIN ONS – Object Name ServicesONS – Object Name Services RFID – Radio Frequency IdentificationRFID – Radio Frequency Identification SSCC – Serialized Shipping Container CodeSSCC – Serialized Shipping Container Code GDSN – Global Data Synchronization NetworkGDSN – Global Data Synchronization Network EPCIS – EPC Information ServicesEPCIS – EPC Information Services GIAI – Global Individual Asset IdentifierGIAI – Global Individual Asset Identifier GRAL – Global Returnable Asset IdentifierGRAL – Global Returnable Asset Identifier URI – Uniform Resource IdentifierURI – Uniform Resource Identifier URN – Uniform Resource NameURN – Uniform Resource Name SGLN – Serialized Global Location NumberSGLN – Serialized Global Location Number


Why RFID in DistributionWhy RFID in Distribution

On average 7.1%* of SKU’s are Out-of-On average 7.1%* of SKU’s are Out-of-stock (up to 30% in some categories)stock (up to 30% in some categories)

Out of stock costs retailers $69B in lost Out of stock costs retailers $69B in lost revenue**revenue**

Delays in getting the product to the store Delays in getting the product to the store and to the shelf impacts salesand to the shelf impacts sales

Most stock is available but not on shelfMost stock is available but not on shelf*Source: Efficient Consumer Response (ECR) Europe

** ** Retail Out of Stocks: A Worldwide Examination of Extent, Causes and Consumer Response, Emory Univ, Univ. of St Gallen, and Unvi. Of

Colorado, 2002


Wal-Mart’s Cost JustificationWal-Mart’s Cost Justification

$6.7 Billion: Reduce labor costs by 15%. Eliminating scanning of bar codes on pallets $6.7 Billion: Reduce labor costs by 15%. Eliminating scanning of bar codes on pallets and cases in the supply chain and on items in the store. and cases in the supply chain and on items in the store.

$600 Million: Reduce out-of-stock situations. The company boosts its bottom line by $600 Million: Reduce out-of-stock situations. The company boosts its bottom line by using smart shelves to monitor on-shelf availability. using smart shelves to monitor on-shelf availability.

$575 Million: Reduces administrative error and vendor fraud by scanning products $575 Million: Reduces administrative error and vendor fraud by scanning products automatically. Knowing where products are at all times makes it harder for employees automatically. Knowing where products are at all times makes it harder for employees to steal goods from warehouses. to steal goods from warehouses.

$300 Million: Better tracking of the more than 1 billion pallets and cases that move $300 Million: Better tracking of the more than 1 billion pallets and cases that move through its distribution centers each year. through its distribution centers each year.

$180 Million: Reduce inventory and the annual cost of carrying that inventory. $180 Million: Reduce inventory and the annual cost of carrying that inventory. Improved visibility in the supply chain, in its own distribution centers and its suppliers' Improved visibility in the supply chain, in its own distribution centers and its suppliers' warehouses. warehouses.

$8.35 Billion: Total pre-tax saving is higher than the total revenue of more than half the $8.35 Billion: Total pre-tax saving is higher than the total revenue of more than half the companies on the Fortune 500. companies on the Fortune 500.


Scope of Wal-Mart RFID Scope of Wal-Mart RFID RequirementsRequirements

Wal-Mart is responsible for 17 percent of Wal-Mart is responsible for 17 percent of retail volume worldwide retail volume worldwide

Receives on average 8 billion cartons a Receives on average 8 billion cartons a yearyear

First phase targets its top 100 suppliers First phase targets its top 100 suppliers who are responsible for one-eighth of who are responsible for one-eighth of those cartonsthose cartons

In other words, 1 billion cartons will need In other words, 1 billion cartons will need to be tagged. to be tagged.


Wal-Mart RFID Tagging Wal-Mart RFID Tagging GuideGuide


Quality ExpectationsQuality Expectations

Case & Pallet tag data needs to be verified Case & Pallet tag data needs to be verified prior to receipt at Wal-Martprior to receipt at Wal-Mart

100% Read Rate for Pallet Tags, but not 100% Read Rate for Pallet Tags, but not all cases need to be readable from in the all cases need to be readable from in the pallet configurationpallet configuration

100% Read Rate of Case Tags on 100% Read Rate of Case Tags on ConveyorConveyor

96 bit Class 0, 1,0+and Gen 2 tags are 96 bit Class 0, 1,0+and Gen 2 tags are acceptedaccepted


Tag DataTag Data


e.g.e.g.


Retail LinkRetail Link

Wal-Mart will NOT use the EPC Network at Wal-Mart will NOT use the EPC Network at this timethis time

Wal-Mart will use Retail Link hosted by Wal-Mart will use Retail Link hosted by UCCnetUCCnet

Primary method for sharing EPC Primary method for sharing EPC informationinformation

Allows Suppliers to see the same Allows Suppliers to see the same information that Buyers and information that Buyers and Replenishment Managers can seeReplenishment Managers can see


Where Are My ProductsWhere Are My Products

Retail Link will allow you to see where Retail Link will allow you to see where in the supply chain your product isin the supply chain your product is In Transit or in DCIn Transit or in DC DC & Store Stock OutsDC & Store Stock Outs DC in Yard - not yet receivedDC in Yard - not yet received EPC Updates will be done at DC EPC Updates will be done at DC

Receiving, DC Shipping, Store Receiving, DC Shipping, Store Receiving, Backroom to Store Floor, Receiving, Backroom to Store Floor, DestroyedDestroyed


Recent ResultsRecent Results

Wal-Mart commissioned the University of Wal-Mart commissioned the University of Arkansas to conduct an independent studyArkansas to conduct an independent study

Wal-Mart RFID Trial Shows 16% Reduction In Wal-Mart RFID Trial Shows 16% Reduction In Product Stock-OutsProduct Stock-Outs

Study also shows that RFID-equipped stores were Study also shows that RFID-equipped stores were 63% more effective in replenishing out-of-stock 63% more effective in replenishing out-of-stock merchandise compared to stores without the merchandise compared to stores without the technology.technology.

An RFID tagged item made it to the shelf three An RFID tagged item made it to the shelf three times quicker than a non-tagged item.times quicker than a non-tagged item.

These items were identified as being in the back These items were identified as being in the back room three times quicker than those without RFID room three times quicker than those without RFID tags.tags.


2006 & 20072006 & 2007

In 2006, Wal-Mart will double the number In 2006, Wal-Mart will double the number of stores that are RFID-enabled, along with of stores that are RFID-enabled, along with distribution centers that service stores. By distribution centers that service stores. By the end of 2006, more than 1,000 stores, the end of 2006, more than 1,000 stores, clubs, and distribution centers will be using clubs, and distribution centers will be using RFID. In January 2007, Wal-Mart expects RFID. In January 2007, Wal-Mart expects the next wave of 300 suppliers to start the next wave of 300 suppliers to start shipping tagged cases and pallets. That will shipping tagged cases and pallets. That will bring the total number of suppliers using bring the total number of suppliers using RFID in early 2007 to over 600. RFID in early 2007 to over 600.


Wal-Mart & Target EPCWal-Mart & Target EPC

Oct. 17, 2005—Oct. 17, 2005—TargetTarget and and Wal-MartWal-Mart, , two of the largest retailers in the two of the largest retailers in the United States, are sharing United States, are sharing Electronic Electronic Product CodeProduct Code ( (EPCEPC) data with 13 ) data with 13 manufacturers as part of a pilot. The manufacturers as part of a pilot. The data is being transmitted in a data is being transmitted in a standardized format via an Internet-standardized format via an Internet-based based electronic data interchangeelectronic data interchange called applicability statement 2 (AS2). called applicability statement 2 (AS2).


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By: Stan A. Szlapetis Director of Software Services RFID