Fruit and vegetable are usually delivered to stores in plastic crates, fish and meat in polystyrene boxes and dairy products in roller cages. At least in Europe a great amount of these transport platforms are returnable and the pool of the transport items is often shared between different vendors in the value chain (such as growers / producers, logistics operators and retailers). This is also the case in Norway, where the grocery sector retailers, wholesalers and producers (DLF and DMF) have joined forces to establish Norsk Lastbaerer Pool (NLP). NLP's first task was to handle the euro pallet logistics for the industry and later it has moved on to also handling plastic crates, specialized new pallets as well as other transport items. Similar co-operation methods can be found for example elsewhere in Scandinavia, in the Benelux and in France.

But what's the point of me introducing this co-operation in Norway in particular? Well, some time ago NLP decided to pilot RFID on pallet / crate level and the pilot was extremely positive. NLP, as many pools, suffers greatly from shrinkage, which is usually due to different vendors not returning the transport items back to the pool. They've calculated that 1% of dropped shrinkage alone will save up to 1,3 Million Euros! And with RFID the shrinkage is estimated to drop even more. Additionally the pool members will benefit from more efficient and transparent logistics, easy tracking of groceries as well as lower pallet costs. In fact, in February 2012 NLP was able to drop the cost of all its Returnable Transport Items, at best with as much as 10%.

The following example introduces far faster throughput times than ever before. Imagine that you have 600+ growers and suppliers who all supply your 8 distribution centers. And they all deliver on a daily basis. At best you have 75 deliveries per distribution center, in reality even more as many of the growers deliver twice. And as you wish to deliver goods to stores as fast as you can, you can only use 2-3 hours per day for the actual goods in, meaning that on an average you have about 30 deliveries / hour. With the new EU regulations you need to track and trace the items backwards (and forwards), so it is not only a question of registering you've received 10 000kg of zucchini, it is a question of registering when the zucchini was first picked, by whom and where it landed. And all this should be done in 2 minutes?

Well, it can be done, I've tested myself. In fact I can tell you that zucchini and cucumber are vegetables which contain a high amount of water and hence are the most difficult products when it comes to RFID. But, it works! And this means it will work with just about any other vegetable too. Here's how: The growers collect vegetables in RFID enabled crates and before the crates are shipped to the distribution center, a timestamp and the grower's individual id will be linked to the RFID tags on the crates. The crates are packed on pallets and a logistics company will deliver them to the distribution center, where a member of the staff will unload the pallets and use a mobile device to read the crates. This takes 103 seconds - so just below 2 minutes. Oh, and you're correct, it would be possible to do this with a fixed RFID antenna as well. The reason why this company uses mobile devices is because they need to be able to perform any RFID related operations all over the field, so they cannot rely on fixed readers, but that is just their case. Being able to do this, allows the company to really deal with all its suppliers and still deliver fast to their stores.

Furthermore, the store staff now knows which crates contain items picked earlier and which later. This allows them to lengthen the shelf life of the items by using a FIFO principle on all goods - put the crates with first picking date on the top of the pile in the store and consumers will buy the items in that order. Even this will have a significant impact on shrinkage as more items are sold before their true expiration time.

But why would you not take it a step further? UNEP, the United Nations Environment Program, estimates that unreliable cold chains cause shrinkage in food worth of 13 million Euros on a yearly basis. It would not be impossible to solve these issues solely with the help of active or semi-active RFID temperature controlling. In fact it would be easy and I would say fairly lucrative. Especially fruit, vegetable and fish are sensitive to temperature. Even small changes in the transport and storage temperatures may cause an entire batch to go bad. Let's use strawberries as an example, for summer is ahead and soon they'll be in my fridge too. A recent university study has estimated the following impact on the shelf life of strawberries (see the table below):

When considering any temperature sensitive item, why would you not equip the carrier, for example the crate, with an active or semi-active RFID temperature tag? The RFID could be utilized for the logistical process in general and additionally a FEFO (First expired, first out) method of piling the crates on the shop floor could be utilized: the crates would be organized according to expected shelf life. The shelf life would be predicted based on the collected transport and storage temperatures. At least for me the dip into the world of cold chain and its impact on product shelf life has been an eye opener and these days I check my fridge temperature on different levels far more carefully. In terms of money saved - retailer you should do even more!