Top China Retailer Tackling RFID in Global Supply Chain

Bailian Group announces plans for EPC, radio frequency ID pilot to track and trace with top suppliers; taps VeriSign for network infrastructure

Bailian Group announces plans for EPC, radio frequency ID pilot to track and trace with top suppliers; taps VeriSign for network infrastructure

Mountain View, CA — May 2, 2006 — Chinese retailer Bailian Group has developed plans for the second phase of the China Implementation Reference Project, a pilot program that seeks to expand usage of Electronic Product Codes (EPCs) and radio frequency identification (RFID).

China's largest retailer, Bailian Group is using the EPCglobal Network, which enables automatic identification and visibility of product information, to track merchandise as it moves through the company's global supply chain.

The first phase of the pilot project involved simulation-based testing of RFID and information infrastructures, modeled on the hypothetical movement of products through a supply chain. The second phase will track the movement of actual products tagged with EPC-enabled RFID tags.

Bailian Group expects the second phase to yield key information about the quality and uses of data generated through the EPCglobal Network.

Improving Visibility across the Trade Network

Infrastructure services provider VeriSign said it plans to offer critical components of the EPCglobal Network for phase two of the pilot, including Object Naming Services (ONS), EPC Information Services and Track & Trace Services. Each of these plays a key role in the storage, discovery and sharing of RFID product information, according to VeriSign.

"VeriSign has provided valuable expertise around the critical data infrastructure and has demonstrated the ability to support the security and scalability needed to improve visibility across our vast trading network," said Shi Jin Xiu, assistant general manager for Bailian Logistics.

For the second phase of the project, Bailian Group is inviting the participation of key suppliers based on their level of interest in integrating RFID technology into the supply chain. Participating suppliers will tag shipments in their originating distribution centers and send those shipments to a Bailian Group distribution center in Shanghai. The movement of these products will be recorded, enabling participants to gain a more accurate view of inventory levels, according to VeriSign.

"Next Step" in Supply Chain Excellence

"The emergence of RFID and the Electronic Product Code is improving global visibility, collaboration and performance in the supply chain," said Jeff Richards, vice president of intelligent supply chain services at VeriSign. "Leveraging information captured from RFID and sharing it across supply chain participants is a critical next step in supply chain excellence. Our work with Bailian Group demonstrates VeriSign's commitment to helping leading retailers and suppliers adopt advanced technologies that yield better visibility into their supply chains worldwide."

As a leading distribution conglomerate in China, Bailian Group's capital totals over $5 billion. Bailian Group employs 200,000 and operates over 7,000 stores across China. In the tally of the top 100 chain enterprises in 2004 in China, Bailian Group and its business lines ranked first with $67.627 billion annual sales. Bailian Group's business lines include retailers, department stores and productive materials as well as logistic services and other services.

Bailian Group is exploring RFID and the EPCglobal Network to maintain its leadership position as an innovative retail company in China. It worked with IT service provider JMIT to put a new information system into practice in 2005 and then began to search for a technological platform to support its growing network of suppliers.

"The EPCglobal Network is an important part of extending the benefits of supply chain efficiency in both China and throughout the world," said Wang Kiajiang, CEO of JMIT. "Given its critical role in supporting the EPCglobal Network, VeriSign is an ideal partner to work with Bailian Group and JMIT to help create more efficiency in our global distribution process."

VeriSign said it is the exclusive provider of Root ONS services to EPCglobal, and these services support the overall EPC directory capabilities of the EPCglobal Network.

Additional Articles of Interest

— RFID technology has the potential to change the way supply chains are managed, but in order to be effective businesses need to take a holistic look at the deployment. Read more in the article "Time for RFID: Applying RFID in the Supply Chain."

— For a contrary view of the future of the RFID market, see the article "The O'RFID Factor: A 'No Spin' Look at Where Radio Frequency Identification Is Headed," in the October/November 2004 issue of Supply & Demand Chain Executive.