The majority (68%) of the UK’s food and grocery industry believe RFID (radio frequency identification) will deliver better benefits for the industry, including greater speed and efficiency in the stock operations, better tracking of products throughout the chain and enhanced forecasting, according to a new survey. 

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With both Wal-Mart and Tesco recently announcing that they will implement RFID with their top suppliers, RFID is set to impact today’s supply chains.


In a recent survey food and grocery think tank IGD asked how retailers are planning to use the technology and what it means for suppliers.


The survey found that overall the industry knows what RFID is and understands it, with 45% saying they have above average or excellent understanding and 42% average. Only 2% have none at all.


Despite 68% of the UK’s food and grocery industry believing RFID will deliver better benefits for the industry, only 39% of respondents have currently been approached by a trading partner to undertake RFID.

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When respondents were asked what the most important factors are for RFID, cost came out on top. In addition 53% believe that the cost of RFID currently outweighs the benefits, however 32% are as yet undecided. This is creating the main barrier to wider adoption, as there seems to be lack of understanding of the return on investment and quantifying the true cost of implementing an RFID tag, IGD said.


Despite the concern about cost, 65% of respondents think RFID will be widespread in between three and five years. This is in recognition of time required for the technology costs to come down, for the standards for the tag to be fully adopted and for the technology to be fully tested in a live trading environment.


Around 63% say it will affect the consumer with many mentioning better availability. But other potential benefits were also cited, for example “RFID could trigger automated payment systems in-store eradicating the need for consumers queuing up at the checkout. This would vastly reduce the average time for shopping”.
 
The full survey findings will be published at the end of June. For more information, click here.

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