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Sony, Samsung and DHL pilot item level tagging for high-value goods

Electronics giants Sony and Samsung have joined with DHL and Mediamarket to pilot an RFID-enabled smart packaging concept designed to improve supply chain efficiency for high-value electronics goods in Europe.

Samsung and Sony pilot RFID

Samsung and Sony are tagging TVs and other electronics as part of a pilot in Europe.

The supply chain for consumer electronics products like TVs, digital cameras, video games and mobile phones is very complex. Often the flow of merchandise comes from multiple sources including manufacturers and assemblers. Goods are then passed off to logistics providers for packaging, transport and delivery to warehouses of retail venues, where they are then encoded before being displayed on store shelves.

Adding to the supply chain complexity is the wide variety of very valuable items shipped, many with very small dimensions. These characteristics make electronic products much more susceptible to potential vulnerabilities throughout the supply chain such as theft and loss.

At the start of the RFID test project called i.trace (The Italian Consumer Electronics RFID Application) Samsung and Sony selected 89 items, including digital cameras, televisions and phones, that represented a range of products distributed through DHL. In total, over 14,000 pieces were tagged with RFID. Mediamarket, a retailer owned by German Metro Group, chose its Saturn store in the Le Due Torri di Stezzano shopping mall in Italy as the pilot store for the project.

RFID traceability begins when DHL receives products from Samsung and Sony at two warehouse locations that serve as high-value storage areas. In these restricted areas, products are inspected, wrapped and stocked.

Larger products like televisions are stocked in a traditional bulk area. All of the product pallets intended for the Stezzano retail venue are then labeled by DHL with an RFID tag provided by Lab Id. RFID tags are activated by connecting the tag’s serial number to the product’s serial number (a sort of identification number determined at the point of origin, in production establishments).

From thermo-retraction, to stockpiling, picking and shipment preparation, the tags enable the electronics products to be monitored at each step.

The pallets pass through a door that is equipped with a scanner and RFID antennae that monitor the exit of goods from the high-value storage area which can read up to 300 tags per pallet.  The operator verifies the exiting process from the storage area through a monitor that reports the quantity and the relative shipment. After it leaves the storage area, the pallet is placed on the exit platform with its untagged counterparts. Each product is traced and identified from the picking process, to the loading phase onto the vehicle and to the Saturn retail venue.

Upon arrival at the retail venue, the shipment passes through a gateway equipped with scanner and RFID antennae that automatically monitors the incoming merchandise. At the Saturn store, a second RFID gateway between the warehouse and the sales floor traces the individual serial numbers that are moved to the shelves of the retail venue and vice versa.

The i.trace project resulted in a reduction in preparation time for ordering and shipping, primarily due to a reduction of time spent performing inspections and shipment logistics. Sony and Samsung recorded a 30 percent reduction in preparation times, shipments and a noteworthy reduction of shipment inspection time. Item level RFID added enhanced security to the supply chain and greatly reduced errors.

RFID also allowed Samsung and Sony to reduce stock in transit and to have better visibility into sell out information. In addition, products arrive at the retail venue more quickly and make it to the store shelves faster, a crucial element for electronics retailers and manufacturers that battle product obsolescence.

At the retail level, the Saturn store gained increased efficiency in receiving operations and visibility with regards to the warehouse stock and the display area of the Saturn retail venue. RFID-tagged products enable the possibility to reduce self-service product stock out and the possibility of obsolescence, a very relevant occurrence as far as notebooks are concerned.  RFID has also allowed the retailers to free up employees from inventory tasks and be put to use making sales.

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