Group 11 Rfid at Metro

8/10/2019 Group 11 Rfid at Metro

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RFID AT THE METRO

GROUP

Anmol Shankhwar

Akshay Gadpayle

Ngaonii Panii

Satyaki Patra

PGP/16/004

PGP/16/017

PGP/16/152

PGP/16/341

Group 11


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Metro Group

1964

Foundedby OttoBeisheim

1967Backingfrom HanielandSchmidt-Ruthenbeck

1970s

Retailing andWholesaling

expansion inEurope

1994 OttoBeisheimretired

1996

Metro Groupformed andcompanywent Public

In late 1990s Company

promoted International

Expansion

In 2005

56.4 bn Sales


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RFID

RFIDRadio Frequency Identification

Technology that usesradio waves to read

special labels attachedto products and

packages

Helps in Storage of moreinformation than in theconventional bar code

Helps in Identifying anynumber of RFID labelsfrom a distance of up to

one meter and Completetracking of merchandize

RFID system composed of a transponder and a reader link to co

Middle ware filter the readers data and passed it to enterprise aTag could be active or passive

Passive tag: derived their energy from reader

Cost0.20

Active tag; derived its own energy

Cost10-50


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RFID in retail

Remained limited due to high costLack of industry wide standards

Barcode could only identify an item

RFIF could identify specific item

Country specific frequency and regulation complicated the deve

standard tag


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Why RFID in METRO

Reducing Shrink in Supply Chain - 25 % in case level and upto

item level Reduce theft at the store

Improving On shelf availability and Reducing out-of-stock

Out of stock has got significant impact on sales, brand loyalty aconsumer satisfaction

Truck loading improvement with automatic RFID check

Improved labor efficiencies

Achieve time and money savings by eliminating manual entriescode scanning

Improved planogram and production compliance


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Future Store

Metro launched the Future store initiativeAim of setting a global standards in retailing

Many partners from IT, consulting, consumer goods

Aims at satisfying customers through new technology

Personal shopping experience

Hand help devices which include product details

It exactly show where the products are placed

Very positive feedback from customers


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Benefits at various stages

Manufacturer- Helps keeping track of shipment and

labor cost Truck Loading- Saving on truck movement time as

loaded with pellet tagging ensuring automatic chec

Plant Warehouse- Ensures correct material are tranand reduce shrinkage

Metro DC- Ensures correct invoicing and acceleratecomparing materials received. Leads to better invemanagement

Stores- Accelerated process of filling shelves. Reduchances of Out-of-Stock


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Potential RFID benefits

Using pallet- leveltagging to improve truckloading process at themanufacturerswarehouse

Driver could automaticallycheck the identity andeliminate the need formanual scanning

Saved 10 min for each

truck 15 trucks

250 working days

Labour cost25 per hour

Manufacturer save16,000per year

Using case- level

tagging to improvemixed-pallet picking atmetro DCs

Pickers errors amountedto 0.5% of the casepicked

With RFID, mountedforklift wouldautomatically record thisinformation

Savings of 4 min foreach pallet

1300 pallets per day

savings of430,000

Labor cost savings of81,000 per year

Using c

taggingshelf re

stores

Replenis

improve

of sales

persona

Metro in

96%

With RF

2% to 98


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RIFD role out

By November 2004, RFID used in 100 metro suppliers, 10 DCs and 250

Supplier has to buy RFID tags and print EPC Portal

green light: matching

red light: not matching

Invest in infrastructure, process design and training

Three different store format: departmental stores, hypermarket stores an

carry wholesale stores Problems encountered:

Suppliers forget to put tag

Problem of middleware

Human error putting tag on the wrong side


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RFID- Decision to be taken

Continue with the existing pallet level RFIDexpansion or

Continue with the existing pallet level RFIDexpanded number of suppliers or

Case level tagging with major suppliers


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Case level implementation

lot more involvement from both the manufactMetro

Manufacturers have to purchase more tags aprocess changes inside their plants

Changes to be made in It systems and data l

Process change inside their plant is expected

Metro would have to invest in training at its stDCs

Suppliers potentially benefit through inventor

sharing


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comparison

Continue with theexisting pallet level

Pros

Maintain steady growth

Minimal risk involve

Cons

Against the action plan ofMetro

Less return

Continue with theexisting pallet level andexpansion

Pros

Replicate the model withmore supplier

Use incremental growth toexpand

Learning curve verypositive

Fast breakeven

cons

high investment for bothsupplier and manufacturer

Continue wexisting pa

Pros

Very efficie

Cons

Very high

Lots of prorequired

Change in

More time

Existing s

Not quant


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Recommendation

Continue with the existing pallet level and

expansionAs moderate investment is required

Replica of existing technology

Risk level is lower

Higher and faster returns

Breakeven very fast

All existing problems are handled and deefficiently

Leanin curve is ver ositive


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Thank you

Documents

Group 11 Rfid at Metro