Switzerland’s largest clothing retailer uses RFID to gain competitiveness
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Charles V, Switzerland’s largest clothing retaileroGele Group uses RFID technology to find “black holes” in the clothing supply chain, reducing store shortages, and reducing inventory inventory time to 50%, according to the company’s supply chain director Thomas Beckmann. At this week’s RFID Journal LIVE! 2009 conference, Thomas Beckmann talked about Charles V?gele’s application process of using RFID to track products from factory to store. He believes that although the global economy is now in a period of recession, this is also the best time for retailers and other members of the supply chain to invest in RFID technology.
Charles V?gele Group, Switzerland’s largest clothing retailer
At the RFID Journal LIVE! conference, Beckmann and other speakers explained how their companies profited from RFID applications during difficult economic times.
After two years of development and testing, this system was officially launched in 2008. By adopting RFID, the company has achieved a 50% reduction in inventory and labor and gained visibility into the weaknesses of the supply chain. Charles Vögele’s supply chain extends from 8 garment factories in Shanghai, China to 4 retail stores in Slovenia.
Charles V?gele has a total of 851 clothing retail stores in Europe, including Switzerland, Poland, Germany and the Czech Republic, with 7,800 employees and annual sales of up to 1.3 billion US dollars per day. Due to its complex supply chain-products are produced in Asia, flow through several distribution centers, and finally to retail stores-the company has been looking for technologies and solutions to improve product visibility.
Before installing the RFID system, Vögele had already paid attention to the visibility of the supply chain. In addition to a group of supply chain teams that supervise whether product production meets the delivery date, the company has also hired a group of quality inspectors to inspect the products before shipment, and then report the results to the retailer. After the products are shipped from the garment factory, they pass through a freight transfer station (a total of 34), where the goods are sorted and confirmed, and then transported by air or ship to the company’s center in Germany. There, the quality inspector checked the goods again before being shipped to the store. Although the company’s large-scale paper recording system covers a wide range and provides detailed supply chain information, the company still finds gaps in data flow, the so-called “black hole.”
“We are quite interested in these black holes,” Beckmann said. V?gele wants to know where the goods are delayed or misrouted, and where other supply chain problems occur. In addition, V?gele also hopes to use RFID technology to improve customer service, so the company chose item-level labeling applications. The goal of the application is to make all products available on store shelves. Through the use of RFID, clothing retailers hope to eliminate store shortages and increase sales. In order to solve these problems, especially during the economic downturn, the company chose RFID innovative solutions. “If we do not adopt innovative solutions, we will lose our competitiveness,” Beckmann said.
In order to implement the RFID program, Beckmann said that V?gele needs to carry out a lot of training, just to improve the adaptability of Chinese garment workers and Slovenian store employees to RFID applications. The company found that some Shanghai garment workers were skeptical of RFID tag scanning, and they could not speak English. The company had to ask translators from Shanghai University to train them and process the software in Chinese.
Beckmann said, “We try to predefine the process we want, and then modify it, sometimes having to adopt unconventional solutions.” All data related to RFID reading is stored in V?gele’s WEB-based ERP system.
After adopting the RFID system, the company reduced the time required for inventory counting by 50%. According to Beckmann, Checkpoint Systems provides passive EPC Gen2 tag and reader antennas. KooBra Software provides software that collects and compiles reader data.
In the Slovenian store, Charles V?gele installed Checkpoint’s RFID readers on the shelves (to track the clothing in the store) and in the fitting room (to monitor the number of garments brought to the fitting room by customers and the actual number of purchases). KooBra software creates a so-called heat map (a store map showing the flow of customers with icons) for V?gele, allowing the store to quantify the difference in shopping behavior between men and women. In this application, employees provide customers with active RFID tags, and then observe their movement in the store, “These we can find out where people are more willing to shop in the store,” Beckmann said.
“In the supply chain, the RFID system eliminates the possibility of human error by allowing the reader to automatically transmit data to the terminal system. For example, now we don’t need to wait for the warehouse manager to tell you the location of the item, the product itself will tell you it. Position, this is a reform of the supply chain,” Beckmann said.
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