chrispeng Which type of retailer can benefit most from RFID automatic identification? You may get a lot of answers, but you would never think that a dollar store would be one of them. Dollar Chest, a retailer in Montreal, Canada (all commodities are priced below one yuan), has adopted RFID technology in its daily operations, and it is said to have achieved good results: inventory accuracy has been improved and sales have been promoted.
Canadian Dollar Store Dollar Chest
Many retailers that sell expensive items (such as jewelry and consumer electronics) have tested or have adopted RFID to identify and track boxes and items. Since the price of all products in Dollar Chest is below 1 Canadian dollar, it is impossible for retailers to label single products. Instead, they label the boxes received by two warehouses in Montreal, and then use RFID paper tags to put the goods into the warehouse, and at the same time check the accuracy of the order according to the advance shipping notice (ASN). Dollar Chest then uses the label to confirm the items ordered by its stores.
Alex Labarces, technical director of Dollar Chest, said that the RFID system adopted by the company is composed of EPC UHF Gen 2 tags and readers, which provides better visibility and management for domestic cargo transportation. Dollar Chest’s four dealerships read the RFID tags of the goods shipped, and then use the tags to track the store’s inventory. Alex Labarces said that the system provides better visibility for receiving goods and also improves the accuracy of inventory records.
Dollar Chest and RFID system integrator Ship2Save jointly designed and implemented the RFID system. When the goods arrive in the warehouse, the workers push the pallets into the assembly area, and check and label each container according to the ASN. The labeled container is then placed on the pallet again; at the same time, the worker holds the reader to capture the EPC data of the container label. When the pallet is loaded, the Ship2Save Order Management System (OMS) software generates an EPC number, which is written into an RFID paper label, and the paper label is affixed to the pallet. Finally, the workers put the pallets into the warehouse.
In order to complete the store’s order, some pallets are loaded with the same type of goods, and some are loaded with mixed goods. Using door-type RFID readers or handheld readers, the staff collects all the EPC numbers required for the order. The OMS software generates an ASN to record the type and quantity of each type of shipment, as well as the EPC numbers of all labeled boxes and pallets.
The distributor downloads the advance delivery notice from the OMS central server of Dollar Chest headquarters via the Internet, and uses a portal reader and a handheld reader to read the EPC code of the container or pallet it receives to confirm the accuracy of the order. Stores can use readers to check the inventory of labeled boxes in the storage room. When the carton is shredded, the reader installed on the cardboard masher reads the label last. Upgrade the storage room inventory level through the Internet OMS, and calculate the number of empty boxes.
According to Labarces, compared to the previous use of barcodes, RFID has greatly improved the efficiency of receiving and delivering goods in Dollar Chests warehouses, saving a lot of time. Before the container is labeled, warehouse workers usually spend 45 minutes to process an order, but now it only takes 6 minutes. Labeling containers also speeds up the warehousing of goods and helps employees identify fast-lost and wrong orders.
According to Labarces, from the company’s earliest test results, the inventory turnover rate of important products has increased from 5.5 to 6 times a year, which means an increase in sales.
In the long run, Labarces stated that Dollar Chest hopes to work with its Asian suppliers to label the containers at the production site. This will save Canadian warehouse workers’ labeling time and help improve the accuracy of shipments.
