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Pantaloon's experiment with RFID Much has been written about Radio Frequency Identification (RFID) and what

it ca n do to manufacturers improve production operations, asset utilisation, forecastin g, inventory accuracy, and finally, customer satisfaction by pinpointing the loc ation and status of products as they move through the manufacturing and retail v alue chain. Taking a cue from this, Pantaloon Retail (India) has piloted an RFID project at one its warehouses in Tarapur using 1,000 RFID tags. Pantaloon is starting from where it matters the most-the real advantage is to implement this technology at the warehouse and then extend it to branch offices or retail outlets. Says Chinar Deshpande, CIO of Pantaloon, "We want to use IT as a strategic tool to differentiate ourselves in the marketplace with new initiatives such as the R FID project. While a SAP implementation is currently underway, the RFID initiative was more t o do with improving the efficiency of the entire supply chain as it has become e conomically viable (for piloting), and we wanted to be the first to execute it. We want to automate the entire supply chain from suppliers to warehouse to store s, and make it transparent." Customer focus The company began to focus more on IT to bring in greater transparency in its cu stomer relationships and to streamline its supply chain. Since Tarapur is Pantal oon's central warehouse, the company decided to deploy RFID there. Deshpande say s, "Whenever we procure merchandise from our suppliers, the entire process had t o undergo two to three steps before it reaches outlets." At each step, considerable human intervention was required and barcode readers h ad been installed at all merchandising locations. Traceability & visibility of g oods in the supply chain, lack of unique identity at each item level, human inte rvention in processes leading to errors, effort required for production cycle co unting, and tracking reverse logistics were some of the issues at the apparel fa ctory. Additionally, these challenges led to lack of co-ordination with the back end at the stores, hampering the company's production planning and inventory man agement. Simplicity wins the day Pantaloon went in for RFID for its simplicity of tagging, operational overhead, efficacy of tag use, product buffering, its ability to keep track of over-produc ed items, product-line lead time at the warehouse, and fast-moving product-lines . Pantaloon selected a few lines of apparel, primarily shirts and trousers-John Mi ller formals and casuals-for its RFID pilot. The RFID application developed by Wipro Infotech was tailored to the overall sol ution in line with Pantaloon's business processes and IT landscape from the fact ory outward to the warehouse inward and from the warehouse outward with the aim of capturing real-time data. The application is integrated with Oracle database 10g and middleware along with an implementation of the RFID hardware. It integrates with the existing IT infrastructure (in-house developed Retail Ent erprise Manager). The main objective was to enable the entire product lifecycle, item-level tagging for identification, and to track the entire RFID roadmap wit h Pantaloon. The piloting was also to do an RFID feasibility study for additiona

l uses. At the factory outlet, RFID tags were attached to the merchandise and the data w ritten to them. When the RFID-tagged merchandise comes through the inward gate, all related information such as purchase and delivery orders will be fed into th e inward terminals in real-time. After correlating the requirements of specific outlets, along with the merchandise in the warehouse, the items allocated for di fferent outlets will be transported. Once the RFID-tagged goods are passed throu gh the outward terminal, the tags are removed. Getting to grips There were a few hiccups related to integrating the RFID application with Pantal oon's legacy IT infrastructure. Since it was meant to be for a pilot project, th e limitation was that only 1,000 tags were available. Initially, the application was supposed to be only for home-made product lines. As the tagging offers simplicity in goods tracking, reallocation of manpower bec ame an issue. The inward numbers of a product must not exceed 500 finished produ cts on a particular day in the warehouse. The selected product line should be one that has a constant movement and should not be seasonal. Additionally, there were operational challenges also. Since RFI D is a new concept, making factory workers understand it posed a challenge. Handling of RFID tags was an issue as the tags needed to be attached to items an d data written to it. Warehouse workers lacked an understanding of passing mater ial through the RFID reader. Removal and return of RFID tags at the factory was also difficult. Uploading fil es, and managing application & devices were not easy through the new application . The RFID evaluation was done in October 2004, and it took four months to impleme nt the pilot project. The pilot was implemented at Rs 30 lakh, which included th e hardware cost (a writer, two tag readers and 1,000 tags) and the cost for syst em integration. Improved efficiency and accuracy Although with a few hiccups, Pantaloon has enjoyed certain benefits. "Recording of data became smooth at the inward and outward terminals, which helped us save time and gain accuracy. Earlier, the possibility of scanning incorrect goods was much higher," affirms Deshpande. Before the implementation, each item used to be scanned through the barcode reco rder. After the RFID implementation, the time saved for the same is about 80% in inward warehouse processing and 12% in outward. Real-time visibility of items d uring all stages of supply chain improved to 98%. Pantaloon aims to extend the application to production routing & scheduling, pro duct recall & returns, and real-time data for category managers for effective fo recasting. "We expect that the newly-implemented RFID application will further help us to i mprove shopping experience, store layout and any inventory situation. Going forward, we see the use of RFID technology in improving collaboration acro ss our supply chain, right up to the point of sale," remarks Deshpande...