IBM Announces New RFID Service

Designed for retailers and consumer packaged goods companies to improve picking, packing and shipping

Chicago September 15, 2003 IBM today announced a new service to help retailers and consumer packaged goods (CPG) companies use radio frequency identification (RFID) technology for advanced product tracking and inventory control.

IBM made the announcement at the Electronic Product Code Symposium in Chicago where the company conducted live demonstrations of pallets and computer read-outs that show how goods move through and are automatically tracked by the RFID system, and how payments and inventory are expedited.

IBM's offering, which comprises consulting and implementation services as well as specialized software, gives companies a phased approach to RFID, the company said. The offering is based on open standards and uses existing technology investments by linking with the retailer's existing back-end inventory system.

It is based on Websphere Business Integration running on WebSphere Application Server, DB2 Information Integrator, Tivoli Access Manager, and WebSphere Portal Server.

IBM said Phase I includes consulting and development of the business case for RFID, Phase II is a 12-week pilot and in Phase III IBM provides the full rollout of the system.

It is estimated that the retail industry could cut theft as well as reduce inventory levels by 25 percent, saving billions of dollars annually, by tagging products and using computers to automatically trace them from the warehouse through shipping and to store shelves.

In June, executives at Wal-Mart, the world's largest retailer, called for their top 100 suppliers to implement an RFID system at the case and pallet level by 2005. More recently this was extended to all their suppliers by 2006.

"IBM believes RFID's time has come," said Faye Holland, worldwide RFID leader, IBM Global Services. "As our retail and CPG customers see the dramatic benefits this technology brings in cost reduction, improved customer service and streamlined operations, the demand is escalating for RFID expertise."

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