UK leads Europe in RFID development, says leading standards body

The UK leads Europe in developing radio frequency identification (RFID) technologies in the supply chain, but a universal standard is needed to help drive adoption and competitiveness even further, according to e.centre, the leading supply chain efficiency association. The not-for-profit organisation, which launches the first EPCglobal Network standards for the technology in the UK this month, also said that RFID will happen, so firms must begin to prepare now to capitalise fully on the benefits.

Speaking to delegates in London, Steve Coussins, chief executive of e.centre, said that companies must prepare their IT systems and technical support teams for the "inevitable arrival" of RFID in the coming years.

"RFID is gaining interest in the UK faster than in other parts of Europe and some companies are even ahead of their US counterparts," Coussins said. "This migration is being led by larger retailers, so supply chains will have to become more accommodating to RFID if suppliers wish to remain competitive. This will inevitably mean new scanners, software, servers and support infrastructure will have to be installed, but the long-term benefits will be huge - operational cost reduction, smoother supply chain structures and increased traceability of goods. Standards are essential to optimise and drive uptake."

Coussins said that initially RFID tags would be added to cases, pallets and returnable assets such as roll cages and totes and that although some high-value goods would be tagged early on, item-level tagging on cheaper goods was still some distance away. However, Coussins warned that clear adoption processes and timescales must be developed by retailers to aid their suppliers' RFID strategies. Where possible, retailers must adopt common, global standards and processes in order to minimise the costs to manufacturers and the supply chain in general. e.centre and EPCglobal are working closely with retailers and manufacturers to develop these common approaches based on the EPCglobal standards.

Paul Roberts, business technology manager at Nestl, said that the cost of implementing RFID technology will be a major financial concern for manufacturers.

"Tesco, Metro and Wal-Mart are all planning wide scale roll out of RFID technology throughout their supply chains but in different ways," he explained. "The financial implications of this are huge. We need a clear, standards-led adoption process with closer co-operation between the major players. A drip, drip approach would be a disaster".

Martin Swerdlow of Integrated Product Intelligence (IPI) stressed that the industry was at the early stage of adoption but was already dealing with a global network.

"In time, and as volumes build, economies of scale will kick-in. This will reduce technology costs and make it easier for late entrants to justify investment," he added. "It is therefore currently misleading to look for a business case in isolation without taking into account the bigger picture."

"Even though there is little immediate incentive to encourage migration to RFID, urgent efforts are required to build the all-important critical mass. Companies will need to work together to share learning and more trained radio engineers are required to manage the growth of RFID effectively," he concluded.

e.centre addressed concerns that information captured by RFID tags could be used to compromise people's privacy. "The EPCGlobal Network does not associate personal information with product data," added Coussins. "Existing regulations in the UK, like the Data Protection Act, sufficiently protect the individual. Industry and consumer groups must develop guidelines to meet consumer concerns and to avoid abuse and, to this end, e.centre is currently leading the UK RFID Council in developing an RFID code of conduct with the industry."

e.centre will be launching the new standard for RFID, the EPCglobal Network, at a special event at the Queen Elizabeth II Conference Centre in London on April 28. Leading retailers such as Tesco and Gillette will be outlining their plans for RFID and the implications for their business operations and trading partners. People interested in attending should contact Sarah Bazeley on 020 7655 9045 or visit our web site, link below.

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