One stop RFID shopping in Japan
IDTechEx have noted before the need for some consolidation in the RFID industry such that users are not faced with having to manage the different hardware, software and integration service suppliers themselves. Some headway has been made, such as the formation of EPCstars in the US, but Japanese companies have set an excellent example. For instance, Dai Nippon Printing, Toppan, NEC and Hitachi are collaborating on a project called HIBIKI. This aims at moving the cost base of current tags to Yen 5 (USD $0.05) per tag. Hitachi is leading this programme.
As another example, ten complimentary companies set up a new collaboration in June 2004 called "RF Partners." The companies include automation equipment suppliers, RFID tag and reader suppliers, RFID encoders/printers, factory automation companies, stationary and offices suppliers, label manufacturers and PDA manufacturers. More partners are welcomed. This combination of expertise enables a one stop shop for many and second sourcing.
Mr Soma of tag manufacturer Fujii, a member of RF Partners, told IDTechEx of some of the applications they have been involved in, one being funded by the Ministry of Agriculture. This is to address problems such as vegetables and fruit being sold as Japanese when in fact they were made in Korea or China; and preventing the sell of foods from areas which have been contaminated - there is a BSE like virus for vegetables. The government want to be able to show the face of the food producer to the consumer, as a way of verifying the source of the produce. Funded by the ministry of agriculture, RF Partners are trialling an RFID solution in the Japanese region of Chiba to meet these needs. 13.56MHz tags are applied to the packaging of fruit and vegetables just after they have been picked and packaged, and they are tracked to the store. At the store, the vegetables and fruit are individually labelled with an RFID tag. Melons are individually tagged from the start. Consumers can use a small RFID reader attached to a mobile phone to retrieve information about the produce. Mr Soma says that soon most mobile phones will have this functionality built in, which others we spoke to agree with. To make this a self sustaining project rather than a continually government funded one, RF Partners are selling the space on the front of the tag which is applied to the produce for advertisements. For example, producers of the food are using this to promote their products compared to competitors.
Similarly LITI (Leading Information Technology Institute), a for-profit privately held company, represent a collaborative consortium of about 30 companies, called the "A-list". These supply hardware while LITI focuses on middleware and systems integration, training and management. LITI is particularly focussed on apparel tracking - one of the largest emerging applications in Japan - for stock management and to increase sales due to stock outs.
Since we covered LITI in Smart Labels Analyst a year ago, they have had a number of full RFID roll outs, which are serving as show cases to potential customers, highlighting the success of the systems and the capabilities of the technology. They have started the ball rolling. For example, the LITI apparel system has been fully rolled out by two Japanese brands, one covering 60 stores in Japan and the other 20 stores. 1.5 million tags have been used for these stores. Tags are applied to clothing at the manufacturing plant, as they are transported to distribution centers and then onto stores. The tags are read to provide updated inventory management to the stores, such as when they can expect to receive stock, its size, colour etc. Some results cited include a reduction from one hour to ten minutes in reading the inventory at each point. It has also resulted in a 20% reduction in the overtime costs of staff. There has also been a sharp reduction in faulty items being sent to stores.
The tags are read/write with a 256 byte memory operating at 13.56MHz based on a chip from Inside Contactless of France. Item number, size, colour, manufacturer and sales information are all traced. The tags were supplied by Nippon Avionics of Tokyo, although LITI use other suppliers such as Fujii, Toppan, Dai Nippon Printing and Mitsibishi Materials in other applications. The tags cost Yen 100 each (about $1), but are reused, with the information printed on the surface of the tag being erased and reprinted each time it is used. LITI told IDTechEx that their biggest challenge has been training users of the system.
The successful implementations have led to a flurry of enquiries from other potential customers. LITI will be announcing a new RFID software product in March 2005.
For more information, read a full article of the developments of RFID in Japan in this months FREE Smart Labels Analyst.