Royal Philips Electronics (NYSE: PHG, AEX: PHI), today announced that it has joined forces with LAB ID and Psion Teklogix to provide Benetton with the world’s largest and most comprehensive item level tagging implementation of Radio Frequency Identification (RFID) technology in the fashion industry to date.
Clothes produced under Benetton’s core brand Sisley have been fitted with RFID-enabled labels based on Philips’ I.CODE semiconductor technology. These labels are part of a complete system solution by LAB ID – the Italian system integrator – and are being used by Benetton to track its garments throughout the company’s entire supply chain. As part of this initiative, all garment box shipments from United Colours of Benetton are also to be labeled with I.CODE-based smart labels. These are tracked using I.CODE-compatible readers and wireless LAN netpads developed and manufactured by LAB ID and Psion Teklogix respectively.
“Benetton has thousands of retail outlets worldwide and therefore wanted to put in place a future-proof technology to bring clear cost benefits to the business whilst seamlessly enabling garments to be tracked throughout their lifetime,” said Terry Phipps, electronic data processing (EDP) director at the Benetton Group. “Working with Philips and LAB ID has allowed us to create an integrated system that encompasses our entire business from the initial manufacturing stages right through to assisting our retail staffing with in-store tracking, ordering and inventory control.”
“Over the last few years, RFID technology has dramatically altered supply chain management in a diverse range of applications,” said Scott McGregor, chief executive officer at Philips Semiconductors. “Philips and LAB ID’s work for Benetton proves to the supply chain management community that RFID technology is now being used in large volumes for item tracking and is beginning to reach the end consumer. We estimate shipping 15 million I.CODE ICs to Benetton for this project in 2003, making it the single biggest roll-out of RFID technology in the fashion industry to date.”
Philips’ I.CODE ICs, which are embedded in labels, are incorporated into garments during the manufacturing process. They are imperceptible to the wearer and remain in individual items of clothing throughout their lifetime. The labels store information relating to the style, size, color and intended destination of items, radically automating key aspects of Benetton’s supply chain from manufacturing and distribution through to inventory control across the company’s 5,000 stores worldwide. The box labels are used to track box shipments throughout Benetton’s logistics process enabling improved identification and item to box correlation, while optimizing the timing of shipments and inventory control and minimizing distribution errors.
Smart labels overcome the limitations of traditional barcode technology. For the fashion industry this is particularly important in terms of authentication, accurate inventory control and checking multiple items in and out of the various stages of the supply chain. Philips’ I.CODE ICs enable a highly automated scanning process that does not require line of sight and can scan multiple items at once. This means that a box containing a variety of garments in different styles, colors and sizes, which traditionally would have been unpacked and checked by hand, can be scanned in one go and the information uploaded directly into the company’s main computer system.
In store, Benetton will use RFID technology in smart shelves and in dressing rooms to highlight where individual garments are located. This technology will also be employed at the point of sale, automatically registering sales and returns and feeding information back into the company’s ordering system to ensure that stock levels are replenished in the most efficient way possible.
I.CODE is part of Philips’ family of RFID ICs, specifically designed for use in high volume logistics applications including retail supply chain management, rental and asset management. Philips’ I.CODE ICs can store unique data enabling the authentication of goods and the prevention of counterfeiting. They can be integrated into labels and / or tags, that in turn can be fitted to almost any item to facilitate asset tracking, automatic data capture and theft protection providing a low-cost, reprogrammable solution for companies looking to implement a highly automated and efficient supply chain management system.
About the Benetton Group
Today, the Benetton Group is present in 120 countries around the world. Its core business is clothing: a group with a strong Italian character whose style, design expertise and passion are clearly seen in the fashion-orientated United Colors of Benetton and Sisley brands; in The Hip Site, the brand for teenagers; and in sportswear brands Playlife and Killer Loop. The Group produces over 110 million garments every year, 90% of which are manufactured in Europe. Its retail network of 5,000 stores around the world is increasingly focused on large floor-space point of sale offering high quality customer services and now generates an annual turnover of 2.1 billion euros, net of retail sales. The Benetton Group is listed on the stock exchanges of Milan, Frankfurt and New York. For further information visit www.benetton.com
Royal Philips Electronics of the Netherlands is one of the world’s biggest electronics companies and Europe’s largest, with sales of EUR 32.3 billion in 2001. It is a global leader in color television sets, lighting, electric shavers, medical diagnostic imaging and patient monitoring, and one-chip TV products. Its 184,000 employees in more than 60 countries are active in the areas of lighting, consumer electronics, domestic appliances, components, semiconductors, and medical systems. Philips is quoted on the NYSE (symbol: PHG), London, Frankfurt, Amsterdam and other stock exchanges. News from Philips is located at www.semiconductors.philips.com