February 27, 2019
By Francisco Melo, Avery Dennison Corporation
If you’ve ever visited Japan, you’ll have noticed the prominence of the convenience store. They are a major part of the retail landscape, and the sheer number of outlets makes convenience chains significant employers. That’s why the Japanese government is embarking on a long-term initiative to safeguard the retail sector against the the labor shortages and cost increases caused the country’s declining birthrate and ageing population.
METI - the Japanese Ministry for Economy, Trade, and Industry - first declared its intention to set all convenience stores on a path to unmanned operation in 2017. Now, following a successful trial, Avery Dennison is helping the Japanese convenience retail sector take the first steps on that journey.
Retailers including Seven-Eleven Japan Co., Ltd., FamilyMart Co., Ltd., Lawson, Inc., Ministop Co., Ltd., and JR East Retail Net Co., Ltd., and Japan Association of Chain Drug Stores (JACDS), will apply RFID labels to products to reduce the burden on in-store staff created by supply chain issues from traceability and authenticity to wastage and returns, as well as to facilitate automated dynamic product pricing and advertising optimisation. The long-term ambition of the initiative is to enable stores to be entirely unstaffed, with RFID enabling customers to pay for their basket of goods automatically on leaving the store.
Ten years in the making, Avery Dennison’s AD-251r6-P RFID tag is instrumental to the initiative. AD-251r6-P is the first UHF RFID tag to be able to withstand up to five minutes of 950 watt microwave cooking, meaning that for the first time RFID can be used on products intended for microwave cooking without the worries that had previously surrounded the use of an RFID tag - such products had the risk of sparking if cooked while still with the packaging carrying the tag. The viability of RFID for the food retail sector was always going to be limited until this problem could be solved, and Avery Dennison has done just that.
AD-251r6-P is an example of Avery Dennison’s excellence in R&D and commitment to making long-term investments in solutions to the biggest challenges. — Francisco Melo, Vice President and General Manager of Global RFID and Avery Dennison
“AD-251r6-P is is an example of Avery Dennison’s excellence in R&D and commitment to making long-term investments in solutions to the biggest challenges”, says VP and GM of global RFID Francisco Melo: “The impact of declining birthrate is a long-term challenge being felt across all industries and areas of society in Japan. Identifying and developing solutions to long-term challenges requires long-term investment. Innovation is at the core of what we do at Avery Dennison, and by combining our materials science expertise and knowledge of RFID technology over the past decade we have been able to develop AD-251r6-P inlays to meet the needs of the food industry. We are pleased to be a partner of the METI initiative offering a safe and reliable RFID tagging solution across all food products.”
Consumers will also benefit from the rollout of RFID through this initiative, with item-level tagging enabling a number of features aimed at streamlining the shopping experience. In a move to reduce food wastage, shelf-mounted RFID readers automatically scan the product tags, identify units that are approaching their ‘best by’ or ‘use by’ date, dynamically adjust prices, and credit the buyer with discounts on those items at the point of purchase. Meanwhile, shoppers who scan a product tag will be presented with additional product information via digital shelf signage.
Perhaps the biggest contributor to smoothing out the customer experience, however, is the automation of the payment process. Picture the same self-checkout terminal you use in the supermarket today, but instead of having to scan each item individually before placing them in the bagging area, you simply place your entire basket into the bagging area, and see every one scanned and your total to pay displayed on-screen ready for payment.
The Japanese initiative is not the first time Avery Dennison RFID tags have played a strategic part in driving the future of convenience retail. Last year the SmartMart in Finland, created in collaboration with Nordic ID, demonstrated the seamless self-checkout, utilizing RFID labels that can be applied on liquid products and metallic packaging, enabling tagging for almost every product in a convenience store - and also a security feature that prevents the exit doors opening if someone tries to leave with an item that hasn’t been scanned and paid for at a checkout.
The country’s often-outlandish television programmes used to be met with cries of, “Only in Japan!” While METI’s plan to eventually turn all its convenience stores unmanned is certainly ambitious, we don’t see it being long before retailers around the world embrace the benefits of RFID across their supply chains and make RFID-enabled features such as dynamic pricing, advertising optimisation, and self-checkout the norm.
Find out how RFID bridges the physical and the digital, enabling food retailers to have a more connected, agile supply chain. In this white paper, we discuss the state of the grocery industry and explore how RFID addresses key challenges such as improving supply-chain operations and inventory management, enabling more socially distanced consumer experiences, while providing full transparency end-to-end.
In partnership with Question XYZ, Avery Dennison hosted a live panel to discuss "The Future of Food." Among the panelists were Stephen Swartz, Director of Marketing at Just Salad, the NYC-based fast casual restaurant with global locations; Roly Nesi, President and CEO of ROAR Beverages; and Julie Vargas, Director of Global RFID Market Development at Avery Dennison.
Frictionless grocery shopping isn’t “the future” anymore. It’s happening right now, as grocers, convenience stores, and upstart brands deploy it in the fight for stomach share.
In this report, we uncover true insights about the latest changes in the food industry – in a world where COVID-19 has suddenly made digitally enabled shopping not just a convenience, but a lifesaver.