Item-Level RFID Tested in Europe, but Cases Await

Unlike Wal-Mart, European retailers Tesco and the Metro Group are working with only a few handfuls of suppliers around RFID.

NEW YORK—When it comes to talk of RFID implementation, Wal-Mart is usually at the center of it. But at the National Retail Federation Convention here, two large European retailers are making some noise of their own. At a press conference Monday, speakers from Tesco and the Metro Group said the two retailers are already performing limited pilots of item-level RFID.

Yet both are waiting for the epcGlobal Generation 2 (Gen 2) spec to kick in before stepping beyond pallets into case-level RFID in warehouse environments.

In another point of departure from Wal-Mart, U.K.-based Tesco and the Germany-based Metro Group are each working with only a few handfuls of product suppliers around RFID.

/zimages/2/28571.gifThe CIOs of Wal-Mart, the Metro Group and Tesco all performed live demonstrations of their RFID operations at the NRF show. Click here to read more.

Tesco will soon expand an item-level RFID test, now in place at one of its stores, to about 10 stores, said Colin Cobain, Tescos U.K. IT director, at the press conference. The test uses RFID-enabled smart shelves to monitor the whereabouts of DVDs in retail settings.

The Metro Group, on the other hand, is working with a trio of clothing companies on item-level RFID, said the retailers CIO, Zygmunt Mierdorf, during the press conference. The garments are being hung on hangers, for easy tracking in warehouses, he added, during a follow-up interview with

But otherwise, Metros RFID testing involves pallets only, according to Mierdorf. Mierdorf doesnt anticipate using RFID at the case level until 2006, when he thinks technology based on epcGlobal Gen 2 will hit the market.

Likewise, Tesco will also wait for Gen 2 before launching case-level RFID, according to Cobain. Tesco arranges its cases in groups on pallets, but the first generation of RFID is unable to read the tags on all the cases in a pallet.

As for partners, Metro is now teaming on RFID with only about 20 distributors, all of whom have worked with Metro before on other projects, Mierdorf said. In the RFID deployment, Metro has opted to mix huge manufacturers with smaller local players, who are more representative of the lions share of Metro distributors.

/zimages/2/28571.gifClick here to read why Jacqueline Emigh says item-level RFID is years away for retailers.

For its part, Tesco is now collaborating with only 10 product distributors around RFID, Cobain said.

"We arent enforcing RFID," he told in an interview. "[Distributors] have to want to be doing RFID, and they need to be taking a holistic approach."

As Cobain sees it, RFID will only achieve real ROI when it is applied all the way from manufacturing, through distribution, to the retail store. "Slap-and-ship is a waste of time," Cobain said.

Earlier on Monday, Cobain and Mierdorf also appeared at the NRF show speaking to an overflow crowd alongside Wal-Mart CIO Linda Dillman.

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