Host Michael Graen is joined by Jonathan Gregory from GS1 to discuss RFID Technology in the food sector. This part 2 episode includes talking points on:

RFID tags and their capabilities for inventory management.

The role of RFID for loss prevention in retail.

Industry standards and best practices for RFID adoption.

But back to your point, you need some additional

information in the food part of the business like date. So walk

us through, how does that change when you move from this for

predominantly general merchandise and apparel to look,

he's got a slide that describes it.

I didn't know how technical we wanted to go.

So I'm gonna I'm gonna jump right in here, Mike. So you open

the door. Great. Come on walk in. All right, man. So so the

DSG10+, that is the encoding scheme, instead of that SG1096.

That is the encoding scheme for food space. Right? So so this is

two examples of two different tags using this DSG10+ encoding?

I'll walk us through this, right. So this is the nerdy

stuff, right? So I'm just gonna back up a tiny bit. And RFID tag

is basically sending you a signal, like you say, hey, tag,

tell me who you are in the tag says 'Okay,' and it gives you a

Amplitude Modulated signal back, so you get a big wave for one

and a little wave for zero, right? And so each one in zeros

big and little waves that come back. And a readers use just one

standards to interpret those ones and zeros and make sense of

them. And here is the gory details of exactly what that is

my first eight bits, my first eight ones or zeros, tell me Ah,

this is a DSG10+ encoded tag. I know what to expect next. Right.

So I know it's a product. And I know this is the format. The

next bit here says, Am I giving you extra information beyond the

core information that's required? In this top example?

No, there's a zero here. In the bottom example, yes, there is

extra information. The next value is a filter, which in this

case is indicating a case. But you could have a point of sale

item, filter value or a unit load or pallet or what have you.

So the filter allows me to have a distinction to be able to say,

Hey, I'm only looking for point of sale items here. Don't give

me the other information or vice versa. The next two, because

it's a DSG10+, then I have to have a date. And so I'm saying

well, what kind of date? Is that a production date? Is it an

expiry date, Best Buy date, right, those types of that that

choice of what kind of date is indicated here by this date

indicator followed by the actual date value? Why why mmdd? You

know, right year, month day format, followed by the G10. So

just like the SG1096, except it's formatted a little more

simply, right? It's it's, it's in one string instead of having

to use like an algorithm to put it together. But I have my

product identifier here. And then following that is a

encoding indicator in length indicator, which is really

describing the serial number that's to come. And so I'm

saying I'm about to give you an uppercase hex a decimal value.

That's eight characters long. And here it is, right. And so

what I've done is I've captured this information that really

that it's a product that I have a particular date, G10, and

serial number. And I've done that in 128 bits. And let me

just say why that why I call that out 120 bit tags are very

widely available. Once you get over 128 bit tags, at least as

of the time of this recording, then you don't have as many

chips available. They're definitely available. They're

definitely out there. But you're outside of what I would

typically call like a commodity space. And so that's your

business decision is you can add more data, but then there might

be an cost associated with that. So just to round this up, so the

first tag I've gone through, right, so 128 bits, my G10, my

date and my serial. The second tag here also includes a

Bachelot. And so we can see the same data structure is just that

the AI DC indicator says yes, I have more data. And then this

next line showing I have application identifier 10 which

is a Bachelot and again, a coding and linked indicator

saying I'm giving you a numeric value that six characters long,

and here it is. Um, so that's the gory details of how that's

done. But really that's so important to the industry to be

able to encode this data and this is the this is part of the

tag data standard 2.0 which was released in August of 2022,

which is really the most substantial change to the to the

tag data standard in over a dozen years. So some major

effort, a major focus within industry really focused on

India. nibbling food to to build interoperable and future proof

solutions that will really, truly scale globally instead of

being kind of confined based on a limited data that's available.

So so give me three different tags. I've got a piece

of apparel that's just a regular SG10. It's a 96 bit SG10. Then

I've got a tag 1 that you've got here, which has extended

attributes, that's 128. And then I've got a tag 2 the bigger,

which is 164. Do I, as a retailer have to have different

hardware and software capabilities to read this in? Do

I have to convert everything over to this new format? Are we

backwardly compatible? Help help me think through that as a

retailer.

Yep. So the same hardware, same hardware to

read the tags, because the SG1096 isn't the only encoding

scheme, there are other higher memory encoding schemes that

exist and the same hardware that supports this, 1096 supports

those other higher memory, so you're not limited in any way

the system of standards, and the air protocol are all such that

there's no impact to your physical hardware, it's simply

when you get the bitstream back, it's your software that

interprets the bitstream. That software has to be upgraded. But

the cool thing is, this is a standard is a global standard.

So you're not making something that's proprietary that's going

to kind of expire and you have to maintain and enter in your

trade partner doesn't know what you're doing. You're simply

upgrading this interpretive framework to the newest

standard, and so that the entire industry is going to have that

capability. So that's something that GS1 Global Office provides

actually a software library that can be used within IT systems to

do that conversion as well. And so it makes the lift a lot

easier.

Alright, for those of the audience that are about

to check out, because we're all talking bits and bytes thing,

let me let me take it back up to the business level. So if I'm a

major, a major retailers, let's leave the quick service

restaurant for just a minute, because this is really about on

shelf availability. I can think of two different kinds of use

cases, one of them where you manufacture the product in a

store, maybe it's a bakery, hey, I'm baking bread. Right? Okay,

so what exactly, let's talk about that specific example.

That would be a retailer that's putting a tag on that bread?

What are the kinds of things that they could do with that,

obviously, we know the on hand accuracy adjustments, but what

are the other things that gives that this new capability that

allows you to do?

Yeah, so by encoding that data into the RFID

tag, you can also have a 2D barcode, I can say a QR code,

that you read at point of sale as well, which is really a

powerful synergy between the two. First talking about in the

store, and then beyond that, so for in the store, I can say,

hey, I'm now searching for items in my store that are going to

expire tomorrow, right or have already expired. And I can do

that very efficiently. Because the something I haven't

mentioned, because I don't want to go too nerdy on you. But the

over the air protocol, the way that readers to tags communicate

has also been updated. Now you don't have to implement that

update. But then latest version of that protocol allows you to

say, hey, tags, only, only you guys, only the guys that are

expiring tomorrow, just just respond to me and no other types

are responding to you think about how efficient that is,

when you're surrounded by RFID tagged items, to only have the

tags that you're looking for, respond and identify themselves

is a really powerful kind of infrastructure advancement

there. So you have the in store visibility, if you will, and

capability and this could be both from a handheld

perspective, or from a gateway perspective, but also the point

of sale. So now, I don't have to have an RFID reader at point of

sale. I just scan that 2d barcode, and I'm able to say,

Oh, this item, this specific item with this date information

has been sold. Great. Like I've now decremented my inventory in

a precise way. If I have even if I'm cycle counting, and I know

we'll have some items over in this part of the store and other

items when that part, I know well, I pulled this item that

was over in that part of the store, and I might replenish to

it or have that more specific location awareness based on that

serialization. But you go beyond the point of sale. Now the

consumer and consumer could do it before or after point of sale

to point their phone at the QR code. And you can tell them a

story. Or you can engage the consumer in a certain way, in a

variety of ways. And so the consumer can can learn more

about maybe somebody wants to check for an allergen after the

fact or or order another one or what have you. Right. Or, heaven

forbid there's a recall or something like that. There's

that capability built into that platform that digitally enabled

platform that's there.

So let me let me make sure I got this right,

because I think I'm tracking with you. So scenario one in the

grocery store, I bake a loaf of bread, I slap just a regular

label on it. And I put it out there for customer to buy it.

Every morning, I gotta go through and look at every single

date in every single boat love for Brad to go is that has to

get marked down because they usually mark it down before they

toss it. But there's a marked down process marked down for a

reduced sale, they usually say I beg too much. So here's an

opportunity. But however they want to market that. And then

the second one is okay, that's now out of date, it's expired, I

have to toss it. That's today's manual process, what you're

saying with this, is I put an RFID tag in that label. So

there's no additional work by the store, they're still putting

a label on, it just has to be RFID, they can use the cycle

counting to literally find that and adjust on hand. So it has

the same level of accuracy that we're seeing in apparel and

general merchandise. But I can also use it to go, hey, there

are three loaves of bread that need to be marked down. And

here's where they are just talked to me three loaves of

bread that need to be marked down instead of all of you

talking. Is that all?

Right. Absolutely, yeah, and I can ...

go ahead Mike.

You linked it in to 2027. So let's take that a

little bit farther. We don't have RFID readers at most point

of sale. Right. So So what did you What were you talking about

the 2D barcode at point of sale that could actually help that

process as well?

Yeah, great question. So Sunrise 2027 is a

GS1 US initiative to enable the 2D barcode scanning at point of

sale across the entirety of the country. And so this is a major

effort were engaged with lab testing, and with the hardware

manufacturers, and it is a core focus of the organization to

enable that to happen. And this is what industry needs and

demands. out of out of this forward progress is we need more

information or product information encoded into the

barcodes. We also have like, you know, our products are kind of

like race cars, they're covered in logos and barcodes, right and

identifiers. And this this intent here is to simulate that

bring that down into one identifier. The power of it with

something called GS one digital link enables that one barcode to

not only have a rich set of data, like the expiration date,

or Bachelot or that type of information above and beyond the

product identifier. But it also allows a web resolvable address,

so allows you to provide product information and engage consumers

in a direct way. So it's more than just the point of sale, but

sunrise 2027, strictly focused, strictly defined, is really

about the point of sale, and that capability to read. Now

it's not sunset 2027 You can still read a barcode UPC one

dimensional barcode, but the intent is to phase away from

that. And so it starts by turning on the capability to

read those 2d barcodes.

Alright, so let's let's play that part out, in

addition to knowing what I have at a high level of accuracy, and

when I leave for my first shift at 4:30, I know there are three

loaves of bread that right now tomorrow morning have to be

marked down. What you're saying is while I'm spending time with

my family, those particular loaves of bread could be bought

at the register. That unique UPC, G10 and serial number is

now left the building. When I come in, I may not have anything

to mark down because I know specifically, the three loaves

of bread that need to be marked down tomorrow are no longer in

the building they were sold.

That's true. Yeah, that's true. As well as,

let's say, let's say you miss it. Let's say you have a

markdown or you have a expired loaf of bread, and consumer

picks it up. Right and they go to the point of sale, the point

of sale is gonna say, Sorry, buddy, I can't sell this to you

that's expired. Why? So it puts that intelligence or the

consumer could use their own phone natively, right, just use

the camera app, just like we use with other QR codes. And it can

give them the same information. So if they take, I don't think

you know, bread necessarily gets recalled. Maybe it doesn't, you

know, like bakery bread, but but in certain cases, maybe. But you

know, somebody hears about a recall and go to their

refrigerator and point their phone at the QR code and the

products in the refrigerator to say okay, has anything here been

recalled as well. So allows that ongoing interactivity like let's

say, a regulation comes into play, or I need to provide more

information about a certain element of a certain product,

right. In that regulation, I can conform to that regularly

through that digital platform without having to change my

product packaging as well. It's really powerful. Yeah.

Wow, yeah, I can, I can imagine, you know, having

having the fortune to both be on the manufacturer side with

Procter and Gamble, and then the Walmart side, I can imagine

product recalls are usually taken off the shelf, I don't

care where it came from, take every little bit of it, because

we don't want the risk. When in reality, there was just one lot

that was bad, but we ended up pulling it all off. And, and,

you know, probably throwing it away, because we just don't want

to take the risk. But we literally could potentially go,

just this lot number needs to come off the shelf. Everything

else. Okay. That's fast.

The cost of recall is huge. It has a big

impact on brand erosion on the even viability of some

businesses or markets. And knowing where did these, where

did these items go? So a quick serve restaurant operator shared

with me that, you know, they have a recall? Well, in certain

cases, they have a large list of potential destinations,

potential stores that this recalled, these recalled items

went to but they don't they don't have without RFID, they

don't have the precision to understand which stores now they

have to literally visit each store, save 75 stores, instead

of the three stores that actually received these items,

they have to physically go visit. Or sometimes they even

have to shut down the registers to say this is serious enough.

We can't allow any sales until this has occurred. So it's

incredibly inefficient to deal with that. So you have a

precision recall has a huge business benefit.

Wow. Well, here's here's another use case, and is

not a food related use case. But the other part of that is

there's a lot of retailers out there. And I'm just gonna call

out Macy's, Joe Cole, great work he's doing in the asset

protection space. And what they're trying to do is compare

what left the store versus went through what went through a

register. Today, it's I sold these G10s, so the UPCs. And I'm

trying to match those against what serialized items left the

store. So you sort of got a one to many kind of thing. Now in

the future, we get this 2d barcode, which has to be

serialized on a package, that gives us the ability to say that

item without trying to use point of sale at registers, because

that that has challenges which ovaries and under reads and

stuff like that. And just more hardware at the at the register

that's going to cost the retailer money, we can actually

read the serialized item that was sold, versus the serialized

items that are leaving the store and take whatever action they

choose choose from them, including if somebody does take

something like that and just track this through, and then

they return it the next day and say, I want my money back, we

happen to know that that particular item never went

through a register and I left the store. They may be a

different conversation with the customer than Here's your money.

Yeah, yeah, absolutely. Yeah, loss

prevention has been. It's grown a lot in the last couple of

years and the focus within the industry, especially because

we've seen loss prevention, or organized retail crime at work,

and may be less organized as well. What's interesting is also

the I totally agree with what you're saying. And that that's a

very powerful thing that the power of sterilization, how does

that apply to loss prevention? Right? And so being able to see,

what did I sell, like you said, be able to say, Okay, no, I

never sold this item, right? I have a mistake proof process in

place where I have to barcodes can a 2D barcode in order to,

you know, I have to sterilize it. So it's a power of

sterilization. But we think about the supply chain for a

second. So claims compliance as one element. So I'm in a

factory, and I'm scanning items as I pack these items, put them

into a case, right? Well, that 2d barcode is, can relate to. So

I don't need an RFID reader there in order to get the

serialization. But I might be reading the content of that case

without having to open the case, through the supply chain as

well. So I have these different layers of visibility in these

really complementary data carriers be 2D and RFID. But one

more thing is that I think one of the things that we we kind of

forget about or don't note is in transit theft. So we look at

like theft coming out of stores. Yeah, but New York Times had an

article a couple months ago, showcasing train theft, that the

theft of people helping themselves to the content of the

rail cars, and what is really substantial. It is greater than

the theft of items coming out of stores. And we tend to not think

of that because we're like, well, we're focused on the store

environment. But when we lock down when we have visibility of

serialized data, going from factory to all the way through

the supply chain. Well now we can say 'Aha, I see that this

item was on a on a train through shipment by never sold it. In

fact, it came from this factory.' And now I see it

entering into a secondary market or what have you, and you give

consumers the power to detect this, a consumer can point their

phone at an item. And that item could potentially say, you know

that that resolver could say, I'm not sure this was ever sold.

I'm not sure this is a legit item, I think you might be

buying something that's stolen. And by the way, when that phone

is reading that QR code, the brand owner can say, 'somebody

just interrogated this, this tag.' That's interesting to me,

too. So it's, it's kind of a scary little bit, but exciting

as far as: how would this be applied? But the power of

sterilization and the power of consumers being able to access

that sterilization and interact with it is, is a multiplying

effect, I think.

Yeah, that's huge. That's huge. Yeah. Which we, as

a practical example, from a family standpoint, you have

capability with your phones right now to go, where's my

family? I know where they are at all times. Obviously, they have

to share that information with you. And it can be used for

detriment or it can be used for harm. But for sure, those kinds

of use cases, hey, I retailer, I'm looking for 100 pairs of

jeans, I supplier put 100 pairs of jeans on the truck, here's

all the serialized items. And if you receive them, and you didn't

get all 100, either you didn't scan a ride, or somebody in the

middle took it with me. That's that's the basis of the Auburn

chip project, right that we worked on for years ago. And we

still, we still want to get to that pose that is the future of

leveraging, since we're asking for, for the most part suppliers

to put things on RFID tags at source leveraging the with a

supply chain. It's just really, really hard to do. But but it's

but it's definitely, I think the biggest opportunity. From an

RFID perspective. Now we've gotten the value proposition in

the store, for the most part, at least got examples where it

works. But that supply chain, I know you're passionate about

that as well, still seems like we're we're lagging in where we

could do from an innovation standpoint, and I'm so excited

to be part of it.

Me too. Me too. There's a lot of exciting

things. We're just talking about the conferences, the last couple

of weeks that we've been to and, and exciting developments to see

what's happening to see, for example, major carriers,

deploying RFID and having continuous visibility throughout

their supply chain, or their value chain or movement chain.

And what are the implications of that? No greater and greater

visibility. So it's a really exciting time for the industry,

Auburn University shared that they had on boarded over 4,000

suppliers in the last three years. It's amazing to think

that much growth that many suppliers starting up and

ramping up with RFID. It shows shows more and more of this this

juggernaut, if you will. And I think it requires that we take a

deeper look at 'okay, do we have this right?' What as this gets

beyond just maybe 30% of the industry, as it gets to a larger

and larger percentage of industry penetration -especially

when we have 2D barcodes - how do we ensure that this

serialization is really the quality controls and the global

elements of this? And so those are really serious questions.

Make sure we get it right as we as we truly scale up.

Wow. Exciting times to be in the industry. Every

time I think you got it all figured out. You figured out

there's five more ways to use this stuff, which is which is

pretty good. Jonathan, just as a wrap up, not only just RFID and

food and Sunrise 2027. What should I have asked you? What's

what's hot on your mind right now? We talked about the supply

chain, leveraging supply chain; are any of the big things that

we should have talked about and I didn't ask you about?

I think he had all the big points. Mike, I

would just share that we have a number... so this has been a

major focus for the last several years. We've had workgroups

producing guidelines, we've actually just released some

YouTube based content, a four part video series that's focused

on educating suppliers on how do I get started food service

suppliers, how do I get started with RFID tagging? What date do

I encode? Where do I put the tag? You know, one of the

considerations from a, from a physics perspective or packaging

perspective? How do I mark tags? Those kind of basic questions to

try and go from, you know, a thick document, that's a

standard to something that that industry can more easily use and

and not have to, you know, go read, you know, a couple 100

pages or whatever. And so we've been working hard to build out

these resources as well as case studies and whatnot. I think the

industry is there a whole lot of quick serve restaurants that are

in pilot mode right now. And as well as we see a lot of action

with retail grocery. And we want to provide those tools That's so

that's something that I feel like we are. We're just about

there. Like we're probably 90% of there with a full kit a full

package. And we'll be 100% there in another two months or so I'd say.

You say in GS1 TikTok. Is that what you're saying?

That has been stated, but I've never taken

that one seriously.

You really want to watch get industry adoptions put

it on TikTok? Right?

Oh, my goodness.

Well, Jonathan, I can't thank you enough, man.

This is this is not the first time we've had you on this

particular podcast, on Conversations on Retail and the

University of Arkansas. It won't be the last you always bring a

great industry perspective of this. And without standards and

real live use cases, this stuff is hard to really get great at

scale. So thank you personally for taking time out of your busy

schedule. But thank you for professionally to educate the

industry. I really do appreciate it.

Thank you, Mike. Appreciate you too. It's

great being here. Appreciate it.