GMA PROPOSES FRAMEWORK TO JUMP-START RFID PROJECTS

MICHAEL GARRY

WASHINGTON - In a new report, the Grocery Manufacturers Association here is proposing a three-tiered approach to RFID implementation that it believes increases the chances of success by encouraging manufacturers and retailers to classify products and processes according to their current suitability for RFID technology.

The proposal is based on a survey of CPG companies regarding their current and planned use of RFID technology incorporating the Electronic Product Code (EPC). The survey results and analysis are contained in a report released last month called "EPC/RFID: Proposed Industry Adoption Framework."

The framework GMA outlined in the report, which applies to both retailers and manufacturers, consists of three tiers:

o EPC Advantaged: Products or processes that represent a logical starting point for pilot programs because of their high benefit potential and robust tag read rates.

o EPC Testable: Products or processes for which business benefits are less apparent and/or some deployment challenges exist. These products or processes should be the focus of readability and tagging tests.

o EPC Challenged: Products that do not have foreseeable benefit potential in the near term and present significant deployment challenges.

The new report strikes a more positive tone than GMA's last report on RFID, published in November 2004, which observed that few CPG companies could generate a positive ROI with RFID technology.

The new report leaves it up to individual companies to decide where their products fall among the three tiers, based on benefit potential, readability and operational impact. "It depends on the company itself and how automated it is internally," said Pam Stegeman, GMA's vice president of supply chain and technology.

Procter & Gamble, Cincinnati, which has adopted the GMA framework, has identified some razor products as EPC Advantaged, as well as processes such as new product introduction and promotion compliance.