Rfid at the Metro Group Essay

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REV: APRIL 1, 2009


RFID at the METRO Group
In early 2004, the METRO Group (Metro), Germany’s biggest retailer, announced its upcoming radio frequency identification (RFID) technology rollout at 250 stores and 10 warehouses, in collaboration with 100 suppliers. The news echoed throughout the retailing community. Previous similar announcements by Wal-Mart and Tesco had made it clear that some in the industry believed that the new technology had the potential to improve the performance of retail supply chains significantly. Among the many potential benefits of this technology were reduced shrink,1 increased product availability, better data quality, and higher labor
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In 1939, the British Royal Air Force developed an “identify friend or foe” transponder that could interpret received radar signals to distinguish friendly aircraft. This was the first example of a device that could automatically and remotely identify itself to another device. RFID worked on the same basic principle: A signal was sent to a transponder which either reflected back a signal (passive system) or broadcast a signal (active system). Research and development in radar and radio-frequency communication systems continued through the 1950s and 1960s. In 1973, an American entrepreneur was awarded a patent for a passive transponder used to unlock a door without a key. When a card with an embedded transponder communicated a signal to a reader near the door, the reader detected a valid identity number stored within the RFID tag and unlocked the door. A similar idea, an automated toll payment system, was commercialized in the mid-1980s. By 2005, the use of RFID had expanded. Many companies used RFID tags in employee badges. Several prisons in the United States used RFID tags to track prisoners. In 2004, Boston Marathon participants’ shoe laces contained RFID tags to track and accurately time the runners and to share their progress with spectators. The American Express Blue credit card started including a feature called ExpressPay that
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