Starbucks Considers RFID For Deliveries

Radio-frequency identification technology could make after-hours deliveries possible, allowing store personnel to concentrate on customers.

Laurie Sullivan, Contributor

December 6, 2004

2 Min Read

In retail, good service is paramount for customer loyalty. But when a supplier is knocking at the back door with a delivery during business hours, sometimes a retail clerk has to momentarily neglect a customer to receive it.

For the omnipresent coffeehouse chain Starbucks Corp., radio-frequency identification technology could help address those types of dilemmas. Sean Dettloff, manager for partner and asset protection at Starbucks, told attendees at the national Cargo Security Council Radio Frequency Identification conference Monday in Long Beach, Calif., that the company is considering using RFID to help with deliveries.

Fast-growing Starbucks, which raked in $5.3 billion in revenue last year, has about 8,570 retail stores in 35 countries. The company uses approximately 40,000 suppliers, many of which are regional companies that deliver fresh muffins and pastries daily.

So how does a company manage that many suppliers and keep its customers the top priority? Starbucks is looking at a strategy it's calling "dark deliveries," meaning that everything from milk to pastries to roasted coffee beans would be delivered after store hours, Dettloff says.

But there are challenges with this new delivery process, including managing physical security and inventory control, so that delivery people "don't walk out with as much stuff as they dropped off," Dettloff says. "So we envision an RFID license-plate signature," he says, that a supplier would use to deliver goods. Using a card, the supplier would gain access to an RFID-enabled system that records the time, disables the alarm, and confirms a supplier's identity before it unlocks the door and lets the person in. Ideally, the system also would record the inventory that's being delivered. "That's not going to happen tomorrow," Dettloff says. "But you can't get the projects going until you develop these ideas."

Starbucks isn't a stranger to RFID--it's piloting technology that uses RFID to secure and track cargo containers. The pilot, used for shipping coffee beans from Guatemala to Seattle/Tacoma ports, began in early 2003. Called Operation Safe Commerce, it tracks 150-pound bags that are loaded into cargo containers for shipping.

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