Woolworths RFID Initiative

1
Woolworths RFID Initiative

• Brook Richardson
• Doug Stout
• Monica Kak
• Yi Mei

2
Background

• 900 retail stores operating in United Kingdom
• Established and well - respected brand name
• Divested from Kingfisher in 2001
• Net Income 25 million after loss of 47 million
  previous year
• Estimated loss of 75 million due to theft

3
RFID Pilot Project

• Participated in government funded initiative
• Tested practicality of RFID and anti-theft
  capabilities
• Technologies used GPS, RFID, Bar codes and WAN
• Implemented on 16,000 dollies and in 30 - 40
  stores
• Enhanced supply chain tracking capabilities

4
RFID Advantages

• Greater visibility of product
• Minimal human intervention
• Paperwork reductions
• 7 savings on internal theft justifies cost
• Tracking cages saves 250,000 on new purchases

5
RFID Advantages

• Potential reduction in transportation costs
• Timely and accurate information to suppliers
• Fewer stock-outs - enhanced sales
• Less inventory throughout system
• Future supply chain breakthroughs?

6
RFID Disadvantages

• Initial investment of 2-3 million
• Continued investment necessary
• Cost to implement in future would be less
• Lost opportunities to pursue other investments

7
RFID Disadvantages

• Risk of being first mover in the industry
• Uncertainty of future technological advancements
• Unknown level of threat deterrent
• Government no longer a partner
• Relies on employee support

8
Conclusion

• Recently divested - uncharted territory
• Risk-averse stockholder perspective
• Tech first mover - not part of culture
• Theft - cultural problem not a tech problem
• Assumes reliability - visibility, suppliers

9
Conclusion

• Labor costs - technological needs, different
  storage and loading practices
• Transportation solutions - GPS, Bar codes
• Management practices - lost cages
• Inventory practices - not RFID dependent

10
Questions ?

• .THANK YOU!