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Cisco and Intel collaborate on next-generation supply chain

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Cisco Systems and Intel Corporation have announced a collaborative effort to support EPCglobal Hong Kong’s EPCnetwork initiative to bring end-to-end supply chain visibility to the Pan Pearl River Delta (PPRD) region.

Building on their technology leadership and expertise, Cisco and Intel are developing Electronic Product Code/Radio Frequency Identification (EPC/RFID) enabled solutions for EPCglobal Hong Kong’s EPCnetwork infrastructure, which will connect manufacturers and logistics companies in the PPRD with retailers worldwide.

The collaboration is one of many programs underpinning the two companies’ allied vision of enabling organisations and consumers to improve the way they do business, interact and stay connected through innovative, standards-based solutions.

The EPC is a unique number that identifies a specific item in the supply chain. RFID is a method of storing and remotely retrieving data using small electronic tags that feature a silicon chip and an antenna. The EPC is stored on an RFID tag, which can be attached to or incorporated into a product or an item for shipment. Once the EPC is retrieved from the tag, it can be associated with dynamic data such as where an item originated or the date of its production.

The use of EPC and RFID together makes individual items and their movements throughout the supply chain more visible to all parties, who can use these technologies to retrieve pertinent product data quickly and easily at any time without human intervention or error.

Among other things, this means that ongoing issues in inventory management, shrinkage, fraud and theft that retailers and distributors face can be addressed. For instance, an out-of-stock average of 9 per cent for retailers worldwide translates into $US69 billion in lost sales each year, and global counterfeiting adds a further $US305 billion annually.

The use of RFID and the adoption of global standards can reduce this loss as it improves visibility for all parties throughout the supply chain network.

With more than 2400 retail locations in 30 countries, METRO Group is the third-largest retailer in the world and sources a range of products from around the globe.

“The adoption of EPCglobal standards for object identification and RFID technology is very important and will help METRO Group as well as the retail sector adopt next generation supply chain solutions much faster,” said Dr. Gerd Wolfram, managing director, MGI METRO Group Information Technology GmbH.

“METRO Group operates six different retail brands and sources products from all over the world. This requires increasing collaboration, integration and visibility with our suppliers around the world.”

The collaboration between Cisco and Intel reflects their commitment to delivering a next-generation supply chain solution based on the EPCnetwork infrastructure, which will allow manufacturers, logistics firms and global retailers to reduce operational costs and improve profitability through real-time data utilisation and highly effective collaboration that enables better, faster and smarter decisions.

Currently, an average of 11 weeks of inventory stock is held in warehouses and distribution centres around the world. Better supply chain management can reduce this considerably, thus helping to cut both the volume of items in inventory and the associated rental or fixed asset costs of storage and distribution.

As a demonstration of their commitment to linking the world’s leading manufacturing hub with the global retail market, Cisco and Intel are poised to provide manufacturers and logistics companies with EPC compliant solutions that allow users to realise the values of using EPC to track and trace goods in real time on the EPCnetwork.

EPCglobal Hong Kong is the only organisation in Hong Kong authorised to issue EPC Manager numbers and is championing the EPCnetwork initiative to create end-to-end supply chain visibility for PPRD-based suppliers.

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