UK retail is heading for supply chain confusion as RFID fails to capture the imagination of British companies, according to new survey findings unveiled today by business standards expert e.centre.
Despite increased enthusiasm in the technology by retailers such as Wal-Mart, Tesco and Carrefour, and major IT players such as Oracle, NEC, Microsoft and IBM developing solutions, many UK suppliers are not considering adopting RFID, citing lack of technical standards and cost as major reasons for this.
e.centre warns that, by not embracing RFID, suppliers could potentially lose custom from retailers who insist on deploying RFID technology to smooth the supply chain, better track stocks and improve food safety.
New research carried out by e.centre, the UK’s leading supply chain efficiency association, shows that despite the hype, 85 per cent of UK companies have no plans to introduce radio frequency identification (RFID) technology in their organisations.
The results of the survey, which spanned all industry sectors, have prompted e.centre to call on companies to embrace the technology that is capable of dramatically improving supply chain efficiency.
The survey quizzed supply chain managers from medium to large enterprises and, despite 88% of those questioned agreeing that RFID was a beneficial technology, only 8% are using or piloting RFID in their organisations.
The results are particularly surprising as a poll conducted by e.centre last summer among a sample of FMCG retailers found 40% of respondents planning RFID deployment by 2005.
“The results of this survey show an alarming, widespread indifference to a technology that will bring significant benefits to business supply chains,” says e.centre’s chief executive Steve Coussins. “RFID is here to stay. It will enable all trading partners in a supply chain, in any industry sector to track and trace products in real-time and manage stock more efficiently.”
The study provides further evidence that retailers are driving forward the adoption of RFID technology, with other industries failing to grasp major opportunities for supply chain efficiency. Currently, big name stores, such as e.centre member Tesco, are conducting important trials but the potential for other industries, such as healthcare, is vast.
“As with the uptake of bar coding 25 years ago, the retail sector is leading the way with implementing RFID technology,” comments Integrated Product Intelligence chief executive Martin Swerdlow. “A growing number of major retailers have announced plans to begin implementing RFID solutions in ‘end-to-end’ supply chains. Manufacturers and trading partners need to get active so that RFID is a benefit to them too, not just an imposition.”
e.centre is paving the way for successful RFID adoption in the supply chain with the launch of a single, global, open standard for the technology. EPCglobal goes live in the UK in Spring 2004, removing the final stumbling block to the technology’s integration with bar coding and other business-to-business communications. Almost two thirds of survey respondents agreed that such a standard would greatly encourage the uptake of RFID.
“The UK has been at the fore of RFID testing and development and yet the poll suggests that we are losing momentum,” continues Mr Coussins. “We must not lose out when it comes to the final stage of implementation. It is of vital importance that UK companies begin to devise strategies for piloting and implementing the technology in line with the EPCglobal Network standard.
“e.centre will continue working with Industry to provide support and education and co-ordinate trials in this field. This will demonstrate that the EPCglobal Network is a cross-sector standard, which will potentially deliver benefits that exceed existing technologies.”