Hytera logistics and distribution two way radio communication product solutions

Intel case study on RFID implementation at Metro Group

By Intel® Solution Services

In the fiercely competitive high-risk retail industry, success depends on
constantly increasing the availability of goods to meet consumer demand and
maximise revenue streams. With a sales volume of 56.4 billion last year,
the Metro Group is one of the top five trading and retailing groups in the
world and is strongly committed to using the potential of innovative new
technologies to meet customer demands and to further its market leadership
position. The major challenge in the complex retail environment is to
assess not only how technology will increase product turnover, but what
impact the technology will have throughout the supply chain.

The challenge

· Improving inventory management processes to lower warehouse costs, reduce
out-of-stock situations and enable higher availability of goods to maximise
revenue streams
· Transforming supply chain management processes by rolling out Radio
Frequency Identification (RFID) technology from manufacturer to delivery
onto the store shelf
· Delivering RFID transponders compliant with emerging EPCglobal standards
to advance and support the worldwide standardisation of RFID technology

The solution

· Metro Group selected Intel® Solution Services to help advance the
development and integration of RFID technology across supply chain
processes including designing the architecture solution, project
management, and vendor management;
· METRO Group launched a European RFID Innovation Center, engaging Intel
Solution Services to develop test competencies, perform rigorous testing of
RFID transponders, and advise on technical troubleshooting and resolution
across the infrastructure environment.

According to Philipp Blome, Manager for Metro Group, Germany: “Intel®
Solution Services consultants delivered the testing capabilities and
expertise required to prove the value of emerging technologies to our
partners and suppliers.”

Assessing the situation

In 2004, Metro Group launched an industry-leading RFID Innovation Center in
Neuss, Germany, which provides a unique testing facility environment to
further the retail's use of RFID and wireless LAN (WLAN) technologies
across the supply chain. This was a high-risk strategy, not only in terms
of deploying new, emerging technology, but to be successful, the project
required buy-in from key supply chain stakeholders and technology suppliers
in order to increase availability of goods on the shelf and maximise
profits. Metro Group selected Intel Solution Services (Intel Corporation's
professional services organisation) to spearhead project management and to
complete critical design, testing and integration services to achieve the
goal of seamless integration across existing infrastructure.

Intel® Solution Services' technical knowledge and expertise in evaluating
network infrastructure and optimising Intel architecture, combined with key
Intel stakeholder alliances – including SAP, IBM, Philips, HP and Cisco –
were critical to defining the optimum solution for seamless technology
integration. As part of the project design process.

Intel® Solution Services experts, based in Germany, evaluated existing
Intel architecture-based systems running business-critical applications
across the network infrastructure to identify the technical issues and
business benefits involved in deploying wireless and RFID technology across
the entire supply chain.

At the core of the design process, Intel® Solution Services needed to
evaluate and identify the optimal technologies to be deployed across the
Metro Group distribution framework. The Electronic Product Code (EPC)
stored on transponders makes it possible to track goods, enabling high
visibility of goods from distribution at the warehouse to delivery on store
shelves. Metro needed a solution that would simplify the goods management
process, reduce out-of-stock situations and achieve operational cost
efficiencies across the business.

Metro Group has an international presence with over 2,400 locations in 30
countries, and is committed to the testing and application of new
technologies to increase shopping convenience for customers, and to achieve
maximum efficiency across the supply chain.

Key Technologies

· Extensive review and definition of the transponders and readers to be
procured and deployed to achieve successful roll-out of pallet level RFID
tagging
· Rigorous testing conducted of EPCglobal standard EPC-Class 1 and
Generation 2, enabling reliable recognition of RFID transponders at all
identification sites.

Integral answers

· Intel® Solution Services recommendations are driving business process
transformation across Metro Group's supply chain, lowering operational
costs and increasing efficiency;
· Intel® Solution Services managed the seamless technology integration
phase, working with key alliance partners to deliver true return on
investment (ROI).

Delivering the solution

The recommendations were developed at the Metro Group's RFID Innovation
Center. Consultants reviewed test specifications, performed tests, and
provided technical issue identification and resolution for implementing
RFID tagging at the pallet level in supplier distribution centres.

Intel® Solution Services managed the introduction of RFID reader scanning
gates at the warehouse goods-in to process, enabling the information held
by RFID transponders to be automatically uploaded to supply chain
management applications, simplifying order processes and dramatically
reducing operational costs. Working alongside two of Metro Group's key
suppliers, Proctor & Gamble and Henkel, the company then facilitated the
rollout to warehouse sites and retail outlets, including Metro's flagship
Extra Future Store in Germany.

From initial RFID tagging at distribution level, incoming goods now pass
through an RFID reader gate at the warehouse. Up to 35 tags can be read per
second, allowing fast reconciliation between goods ordered and goods
received and improving the goods flow control system. The respective RFID
product data held on each pallet is then automatically transmitted to the
inventory management system, enabling real-time visibility of products and
significantly reducing time spent manually inputting product information.
Intel. Solution Services also provided Metro Group with results-orientated
project management to deliver seamless integration across the entire supply
chain.

Return on investment…

Leading technology alliances with stakeholder technology vendors ensures
seamless integration of RFID and WLAN technologies with existing
infrastructure and business critical applications, maximising operational
efficiency and significantly reducing back-end costs;
· Metro Group saw nearly 100% reading rate of RFID transponders for all
defined logistic units;
· Metro Group supports retail adoption through its use of the emerging
EPCglobal standard EPC-Class 1/Generation 2.
· Intel® Solution Services enabled Metro to set a new retail technology benchmark.

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