The Benetton clothing line, known for its bold colors, has made a bold move into RFID. The company is tagging every item of its leading Sisley brand goods with an RFID tag based on Philips’ I-CODE technology. The chip–based on the ISO 15693 standard–will enable tracking of the item from manufacture, through distribution and warehousing, and ultimately to store shelves and point of sale.
“This is one of the largest worldwide supply chain projects to date,” says Saleem Miyan, Philips Global Strategic Business Manager for Worldwide Marking of RFID. “It is not a pilot, but a true rollout throughout all stores.”
In fact, the project is already planned to incorporate 15 million RFID tags. The project began one year ago when Benetton, project integrator Lab ID, and Philips began discussions and subsequent testing of the product.
From sewing machine
to cash register …
According to Terry Phipps, electronic data processing (EDP) director at the Benetton Group, the company wanted 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.”
Lab ID, the Italian company responsible for the project, adds an antenna to the Philips I-CODE chip and creates the finished label to affix to the clothing item.
Lab ID also supplies hardware and software to the implementation. Psion Teklogix provides a handheld reader for use in inventory control environments while other readers are built by Lab ID using the Philips I-CODE chip sets.
In addition to the RFID tags on each item, each shipping container is also labeled using I-CODE. This enables inventory tracking at both a micro- and macro-level. In warehouses and in stores, shelves are identified via RF tags to enable easy location of product and fast, efficient inventories to be taken and products to be located.
I-CODE in the labels
The I-CODE product costs less than US$0.20 in volume and ships from the manufacturer with a unique 64-bit serial number. Lab ID or Benetton can attach additional digits to further customize the number and add meaning data.
The chip also includes an on-board electronic article surveillance (EAS) function that enables theft prevention. EAS is the technology used to trigger audible alarms when tagged items are removed from a store without payment being made. In most basic form, EAS is a simple RFID system that identifies each item as one or zero. A one is the “on” position indicating that the item has not been paid for. A zero is the ‘off’ position indicating that it has been paid for. When the item is taken to the register and payment is made, the clerk waves the item over a transmitter that changes the position from on to off. The item can then pass through the RF field at the door without triggering the alarm. With I-CODE, the EAS digit can be reset from on to off, and then from off to on if the item is returned by the buyer and must be restocked.
I-CODE is also in use in a number of other high profile applications. Michelin embeds the tags in tires; Dell computer uses I-CODE to manage the manufacture of PCs (e.g. routing the PC around the DVD install area if this is not a component of the specific unit); Toyota, Ford, and Harley Davidson use it for manufacturing control; Nestle uses it for managing inventory; and Carlsberg uses it to track its several million beer kegs throughout distribution networks.
When asked if the RFID technology was viewed as an anti-counterfeiting mechanism, Mr. Miyan replied that it is certainly a potential outcome of the technology. It all depends, he says, on the way the issuer puts it to use. “Counterfeiting accounts for 5% of world trade, US$80 billion,” he adds. “This technology is an enabler for stopping this fraud but it comes down to the way the issuer puts it to use. This is where the application of the intelligence comes into play.”
How about the privacy concerns?
As with any identification technology, privacy concerns are bound to arise. Could someone track a consumer based on the ID code embedded in the sweater they purchased at Benetton? Doubtful, but nonetheless consumer fears impact buying decisions whether they are rational or not.
According to Mr. Miyan, “the merchant can destroy the chip and deactivate the data if they choose.” At the point-of-sale, the chip and the data encoded on it can easily be destroyed. This would end any question of future tracking potential. But it would also limit some consumer conveniences such as the potential ability to return the item without a sales receipt as the item’s sales history could be accessed via the RFID number.
“The question to be asked,” Mr. Miyan points out, “Is it beneficial?” And this must be decided between the retailers and the consumers. “Knowing where to stop is the biggest question.”