 | Tuesday, March 18, 2008
Issue 800 | | Will Smith, Editor |  |
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Editor's Note: Today's top story is the new finding by the Information Technology Research Institute (ITRI) at the University of Arkansas that case-level RFID tracking can reduce undercounted inventory at retail stores by 13 percent. The finding is a result of a study conducted by the university's RFID Research Center at 16 Wal-Mart stores, including eight control stores where inventory was managed by traditional methods, and eight test stores where RFID systems tracked product in the back room.
Active RFID solutions provider RF Code today announced the Data Center Pilot Program, which offers data center managers a no-cost, 45-day trial of Pilot Rack, the company's tracking solution for rack-based assets. Pilot Rack is designed for data centers with more than 100 racks of servers and equipment.
Lastly, the Washington state Senate has joined the state's House of Representatives in banning RFID skimming, the act of surreptitiously scanning personal information from an individual's RFID device, be it an e-passport, driver's license, credit card, etc. The bill, called HB 1031, now goes to the governor for final approval. See the announcement. |
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| RFID Tags & Labels | | - Ferroxtag HF tags: Smart on Metal! (site) | | | Products & Services | | - RFID at Work, University of Texas at San Antonio, Mar 27-28 (site) | | - Employees steal over $1 billion per week from employers (site) | | | Employment | | - RFID Recruiters - 100% Focused on RFID Recruiting (site) | | | Upcoming Events | | - AWA PABS08 N. America Conference, Sept 11-12, Chicago, IL (site) | | - AWA PABS08 Asia Conference, Dec 4-5 - Hong Kong, China (site) | | - European Supply Chain & Logistics, 13-15 May, Germany (site) | | - RFID World Asia 2008, 8 to 11 April, Suntec Singapore (site) | | - SCAN & RFID CHINA 2008, June 19-21, Guangzhou, China (site) | | | Research & Whitepapers | | - RFID Marketing Strategies Report (site) | |
RFID Yields 13% Reduction in Understated Inventory
Case-level RFID tracking at Wal-Mart stores reduced understated inventory by 13 percent, according to a new study released by the Information Technology Research Institute (ITRI). Entitled Does RFID Improve Inventory Accuracy? A Preliminary Analysis, the study focused on measuring understated (hidden) inventory, which refers to materials that are actually in stock but are not reflected in perpetual inventory (PI) records.
The 23-week study measured inventory levels for the entire air freshener category at 16 Wal-Mart stores, including eight control stores where inventory was managed by traditional methods, and eight test stores where RFID systems tracked product in the back room. RFID systems at test stores could also perform inventory adjustments automatically.
RFID test stores improved understated inventory accuracy by an average of 13 percent. Test stores also had nearly twice as many inventory adjustments as control stores, but with less labor time spent on adjustments.
"I didn't expect to see that big of a difference in inventory improvement, especially since we were only working one side of the perpetual inventory equation," Dr. Bill Hardgrave, director of the ITRI's RFID Research Center at the University of Arkansas and lead researcher on the study, told RFID Update. "These results are very encouraging for retailers."
The study did not measure overstated inventory (where records indicate there is more inventory on hand than is actually available). Researchers cited other studies that found retail inventory records are inaccurate for up to 65 percent of items, and that error rates for understated and overstated inventory are roughly equal. Wal-Mart is not releasing its actual measured inventory accuracy rates from the study, only the difference between RFID and non-RFID enabled stores.
Data was collected from Wal-Mart Supercenter and Neighborhood Market stores, but is reported only in aggregate. A third-party inventory management firm audited inventory levels at each store each day to collect the data for analysis.
At test stores, cases of air fresheners were tracked with RFID readers at the receiving area, at the doors leading from the back room to the sales floor, and at the box crusher, where the reading indicated that the case had been consumed. Test stores also got a software application, dubbed "auto-PI", that automatically adjusted perpetual inventory records based on input from the RFID readers.
Control stores continued to manage inventory and update perpetual inventory records manually. Control stores averaged 3.4 manual adjustments to air freshener inventory per week, compared to 5.6 automatic adjustments from the auto PI system at test stores. Managers at test stores were free to make their own inventory adjustments, and made an average of 2.0 per week, for a total of 7.6 adjustments at test stores.
"Perpetual inventory was improved with no additional labor," Hardgrave said in ITRI's announcement.
The understated inventory study was released last week and is the latest in a series of research projects that Wal-Mart has sponsored by the ITRI and the RFID Research Center (see 30% Out-of-stock Reductions from RFID).
Just how much benefit Wal-Mart is getting from its RFID use is a frequent topic of debate in the industry. Its RFID program is continually evolving, most recently to emphasize RFID tracking applications at its Sam's Club stores. For recent coverage, see:- Sam's Club RFID Mandate No Big Deal?
- Sam's Club Wants Item-Level RFID Tagging by 2010
- Sam's Club Suppliers May Face RFID Fines from Wal-Mart
Forward this to a colleague | Request reprints: reprints at rfidupdate dot com |
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| RFID Tags & Labels | Ferroxtag HF tags: Smart on Metal!
Ferroxtag is a new family of HF RFID tags suitable for operation on metallic surfaces. Ferroxtag's special ferrite antenna was developed using Ferroxcube's years of experience in ferrite technology. The high performance antenna means longer read range with a smaller tag. Visit www.ferroxtag.com | | | Products & Services | RFID at Work, University of Texas at San Antonio, Mar 27-28
The Manufacturing Systems and Automation Laboratory at the University of Texas at San Antonio offers a 2-day, interactive, hands-on workshop with Omnitrol Networks and Motorola. In addition to reviewing technologies, case studies, and deployment challenges, attendees will experience hands-on applications, ranging from dock doors to smart shelves to hand-held readers. | Employees steal over $1 billion per week from employers
the American Management Association reports. 95% of businesses are victimized by employee theft. Managers are reluctant to ask questions, because trusted employees may feel offended, leaving business owners in a difficult situation. What can you do? Nox: Intelligent Perimeter Defense from Simply RFID provides advanced security and protection for business assets. | | | Employment | RFID Recruiters - 100% Focused on RFID Recruiting
Whether your company is looking for the best RFID talent or you have the best RFID talent and are looking for the best RFID employer, RFID Recruiters offers the most focused approach to your objective. To learn how the RFID industry and the RFID job market are evolving, visit www.rfidrecruiters.com | | | Upcoming Events | AWA PABS08 N. America Conference, Sept 11-12, Chicago, IL
AWA is organizing the Product Authentication & Brand Security Conference 2008 on September 11-12 in Chicago, IL. The event includes presentations and panel discussions with brand owners, legal authorities, associations, converters and suppliers; also networking sessions, a supplier forum, a social program and more. Find more on the program here. | AWA PABS08 Asia Conference, Dec 4-5 - Hong Kong, China
AWA presents the Asian Product Authentication & Brand Security Conference 2008, to be held on 4 & 5 December in Hong Kong, China. PABS08 Asia focuses on the threats specific to the Asia Pacific region, various elements of IP Theft, and leading-edge solutions. Find more on the program here. | European Supply Chain & Logistics, 13-15 May, Germany
Bringing together Europe's leading providers of supply chain management to evaluate best practices and to move the supply chain agenda into the boardroom. Also, featuring the AMR Research Strategy Session: What makes a supply chain world class in today's global market? More information here: www.supplychain.eu.com | RFID World Asia 2008, 8 to 11 April, Suntec Singapore
RFID World Asia 2008 is THE event for finding out the transforming power of RFID for your business and its future. Sign up now for RFID Asia Summit 2008, targeted at senior-level executives; to understand and reap the benefits of this new business tool. For more information go to www.terrapinn.com/2008/rfid | SCAN & RFID CHINA 2008, June 19-21, Guangzhou, China
As one of the earliest, most specialized and authoritative exhibitions in China, approved and supported directly from State Ministry, the 8th SCAN & RFID CHINA 2008 will present you the impressive up-dated development and market of RFID technology in rising China. To know more, please go to www.scan-china.com. | | | Research & Whitepapers | RFID Marketing Strategies Report
Thirty-nine pages of original research on RFID audience perceptions, including 30+ figures of tactics, content & messaging, and recommendations to guide marketing strategy. Also, Top-10 RFID company rankings based on 550+ survey respondents. View the executive summary free, with Top-3 sample rankings. Only $495 Individual License or $795 Corporate License. Available now |
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