RFID
RFID received a lot of attention during 2004, but according to McCabe pilots in retail and manufacturing are small, low key, and few in number. Interest remains high: all large retailers are assessing RFID, and their suppliers know that the technology will be mandated, he says.
Trevor Barrows, director of supply chain management operations at SSA Global agrees, predicting that once the Generation two standards and associated intellectual property issues are settled and the tags go into production, local industry will pressure the government to allow their use in Australia. Serious pilots-and maybe production systems-at the pallet/rollcage/case level will be in place by the end of the year, he predicts. "It's really a bureaucracy problem now," he says.
The use of RFID to drive cross-docking will probably take another year, he suggests. "[RFID] is something that's going to make an impact on retail supply chains in the next couple of years," says Sherlock. It can help overcome problems with data quality and synchronisation, for example, by automatically reconciling advance shipping notices with the items delivered as they arrive. RFID requires investment by retailers, suppliers and supply chain service companies, but it can produce benefits for all of them, he says.
Logistics
Logistics is an important part of the supply chain, and Barrows says it is of current interest to retailers. Woolworths, for example, has already set up new, highly efficient distribution centres with flow-through facilities allowing goods to pass through a centre within 24 hours, or as little as eight hours for some lines. "It's a very challenging model," he says, but he predicts that more than 60 percent of retail inventory will eventually be flow-through in order to drive costs out of stores.
Voice and wireless technologies are already being applied in distribution centres for hands-free operation while picking. Barrows expects this will be extended to cycle count (an ongoing reconciliation of stock figures and reality), replenishment (the movement of bulk reserves to picking slots), and
cross docking.
Transportation is also subject to cost pressures, and Barrows says some transportation companies are withdrawing from the retail industry as it has become unprofitable. The challenge for retailers is to optimise the use of transport (whether it is their own fleet, an outsourced operation, or a combination of the two) for example by taking advantage of multi-leg journeys and back haul opportunities, and by synchronising transport to and from distribution centres to meet service levels to stores. This can be a complex problem, as a single trip from a distribution centre typically covers multiple stores with a mix of dry, fresh, chilled and frozen goods for each.
Write to the Editor at Technology and Business
* All fields are mandatory.