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METRO GroupRFID Roll-out

October 2005

Scott Medford, Vice President - RFIDIntermec Technologies Corporation

for

Dr. Gerd Wolfram

Managing Director MGI

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METRO AG 2005

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J anuary: Founding of the METRO Gr oup Fu ture Store Initia tive

A pril: Opening of theExtr a Fu ture Store,Rheinb er g

N ovember: EPCglobal replac es Auto-IDcenter

2000 2003 2004 2005

J anuary: Announc ement of RFID r ollou t a t NRF, NYMay: 1 st METRO Gr oup

RFIDcong ress for suppli ers, Cologn e

J uly: Opening of theMETRO Gr oup RFIDInnova tion Center, NeussN ovember: Sta rt of RFIDr oll-ou t, 1 st pha se

RFID at METRO Group A Success Story

J anuary: 1 00-day sbalanc e of the RFIDr oll-ou t a t the NRF, NY

J une: 2nd METROGr oup RFIDcong ress for suppli ers, Cologn e

End of 2005: Sta rtof RFID r oll-ou t, 2nd pha se

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METRO Group Future Store Initiative

IBM INTEL SAP T-SYSTEMS

CISCO SYSTEMS COCA-COLA DHL SOLUTIONS HENKEL

HEWLETT-PACKARD JOHNSON & JOHNSON KRAFT FOODSLORALLOYALTY PARTNER MICROSOFT NESTL ORACLEPHILIPS PIRONET NDH PROCTER & GAMBLE SATO SYMBOLTECHNOLOGIES TRICON VISA WINCOR NIXDORF X-IDENT

ADT DEUTSCHLANDALGOTEC ALPHA TONTRGERAVERY DENNISONBIZERBA BOSTON CONSULTING GROUP CHECKPOINT SYSTEMS CHEP

EYCKELER & MALTFEIG ELECTRONIC FUJITSU SIEMENS COMPUTERSGILLETTE HINTZPETER & PARTNER INTERMEC KURT SALMONASSOCIATES LIEBHERR LOGOPAK SYSTEME METTLER TOLEDOMULTIQ NCR OAT SYSTEMS ONLINE SOFTWARE PAXAR SIEMENSBUSINESS SERVICES SONOPRESS TOMRA TOSHIBA TECUPM RAFSEC WANZL WMS ZEBRA

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METRO AG 2005

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Our Vision: RFID along the complete supply chain

Production

Storage

Loading

Order picking/additional merchandise

Delivery notification (DES A DV)Incoming merchandise

Incoming merchandise - precise verificationReserve area

Outgoing merchandise

Incoming merchandise

Inventory management

Shelving

Shelf management

Manufac turer Distr ibu tion Wa rehou se Store/Outlet

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METRO AG 2005

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Sta rted November 2004 witha r ound 20 indu str y pa rtners, a s well a s se lected wa rehou ses, st ores and br anc hes of the METRO Gr oup

Launch of theroll-out

Inco ming /ou tgoing good s, inventor y replenishment, au toma tic reconcilia tion

Logi stical uni ts (pall ets) and retail uni ts (bo xes)Individual items a re no t includ ed in the RFID r oll-ou t

RFIDtransponders

on...

Focus of theroll-out

METRO Group RFID-Roll-out

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METRO AG 2005

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Phase 1 : Participation of three METRO Group salesdivisions since N ovember 2004

Galeria Kaufhof

Appa rel/Textiles

3 Suppli ers5 DCs

Real

Gr oc er y

1 2 Suppli ers11 Stores3 DCs

MetroCash & Carry

Gr oc er y, Gener al Mer chandi se20 Suppli ers2 Stores1 DC

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Suppliers involved today

DR. OETKER NESTL MILASAN MAGGI PAPSTAR 3M FABERCASTELL JOHNSON & JOHNSON 3M SCOTCH GILLETTEGLAXOSMITHKLINESCHWARZKOPF & HENKEL LEVERFABERGTRIUMPH GERRY WEBER ESPRIT PAPSTAR KRAFT SARA LEEPAPSTAR TIP GILLETTE BRAUN HAKLE KIMBERLYSCA

Suppliers involved Q2/3 2005

NESTLE PURINA HENKEL WASCHMITTELCOLGATE PALMOLIVEUNILEVER BESTFOODS SCHWARTAU MELITTA MEDIONBEIERSDORF FUJITSU SIEMENS MATTEL BOSCH SIEMENSHAUSGERTE WAGNER PIZZA FREIBERGER LOREA LINTERUNION

With availability of GE N 2 about 1 00 suppliers

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METRO AG 2005

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RFID Rollout Still a long way to go

3Distribution Lines

111RFID Gates

26Supplier

879 .979EPC Reads

82.800Items

79 .1 00Cases

21 8. 1 08Pallets

METROGroup

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Standard rollout portal setup

Motion Sensor

4 an tenna s

Read er

Light stack

Metal pr otection

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Extr a Rheinb er g

1 4 Check Out

9 Exit Gates

4 Portals (e.g. Trash Door)

1 Standalone PCCustomer Information

RFID Server (Rack)

RFID Controller for Check Out and Gates

to S A P SII

2 Entry Gates

Eth. Switch

Standalone PC

ExtraRheinberg

1 4 Check Out

9 Exit Gates



RFID Server (Rack)

RFID Controller for Check Out and Gates

to S A P SII

2 Entry Gates

Standalone PC

1 4 Check Out

9 Exit Gates



to S A P SII

2 Entry Gates

EthernetSwitch

Standalone PC

DC EssenDC EssenDC Essen1 Portal (Dock Door)

Standalone PC 1 Standalone PCDC Packing

1 Portal (Dock Door)

Standalone PC 1 Standalone PCDC Packing

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METRO AG 2005

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Read er and Motion detector - Con tr oller Ga te- / PID -Messag es

RFIDSer ver

B ackend System

1 . Read er Read er Read er 2. 1 0.

1 . 2. 3. 4. 20.

11 . Read er Read er Read er 1 2. 20.

21 . 22. 23. 24. 3 9 . 40.

21 . Read er Read er Read er 22. 2 9 .

41 . 42. 43. 44. 5 7 . 1 9 .

RFIDCtr l

Read er

Scanning PIDReading UIDCrea te a UID-/ PID-Messag e

Cac he UID / PIDGa te Con tr oller Messaging

Picking Zone

Food, N on-Food, Cross-Docking

RFIDCtr l

RFIDCtr l

RFIDCtr l

Read er and Motion detector - Con tr oller Ga te- / PID -Messag es

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METRO AG 2005

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Pallet-level roll-out: instant data processing and verification

Reading

ini

tia

ted by

motion detec tor

Tag Da ta (SSCC)

tr an smitted to

decentr alized edg e

nod eser ver via

LANnetwor k

SSCCsent to Centr al Ser ver;Ma tched with EDI

da ta f r omtheMer chandi s

e

Manag ement Systems

"Green light"if Ser ial

Shipping Con tain er Cod e

ma tches da ta f r om

Mer chandi seManag e-

mentSystems

321 4

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1 00 days of RFID High reading accuracy in first trials

Hang er good s conv eyor:

99%

Portal for inco ming and ou tgoing good s:

Varying results,up to 99%

Retur nabl e tr an spo rtitems:

> 9 0%

Stackabl e good s conv eyor:

99%

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1 00 days of RFID Technical challenges

Installa tion and Optimi-za tion of diff erentsetup s for va r iou str an spo rta tion mod esdepending on pr oduc tgr oup (i.e. hang er good s conv eyor, po rtal for inco ming and ou tgoing good s)

Integr a tion of diff erent back end systems

Pr oc ess impr ov ement:ma tching of motion detectors and read ersread er configu r a tiontag is da mag ed,wr ongly a ttac hed or miss ingDESADV too la te/miss ing

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METRO AG 2005

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N EXT Steps

Enhanc ement of suppli ers and loca tion s

Enhanc ement of RFIDba se d pr oc esses (e. g . f r on tstore back store se pa r a tion , RFIDequipp ed for klif ts, etc .)

Sta rt with ca se level tagging

prerequisite for all further r ollou t ac tivities is theavailabili ty of Gen 2 pr oduc ts

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METRO AG 2005

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Expected improvements of Gen 2 by end users

Wor ldwide standa r dPr ice decline for RFID lab elsUse the RFIDadvan tag es in global supply chain sInc rea sing investme nt saf ety

Better per formanc eLong er read r ang esHigher an ti colliss ion (abou t 600 Tag s in a

se c .)

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METRO AG 2005

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Efficiency Rang e CostSecu r ityReliabilitySpeed

U ser Requirements

Dense re ad er installa tion

Global unlic ensed op er a tion

Minimal inter f erenc e

Up to 5meter r ang e Sync hr oniz ed

Timing

Wr itepr otection

Tag kill

Secu re forwa r d link

Da ta cloaking

Ver ified wr ite

Err or co rrection in air inter fac e

Wideop er a ting temper a ture

Elimina teghost tag s

Many tag sand la te tag s

Fa st singula ted wr ite

Tag se lect by da ta filter

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METRO AG 2005

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ISO 1 8000 and EPC Gen 2

On tr ack towa r d ISO standa r dISO and EPC nu mber ing system conflic t resolvedOne bit (bit 17 of PC bits) defines whether EPC or ISO (AFIs)

EPC UHF Gen 2 v 1 .0.9 sub mitted to ISO SC 31 /WG 4/SG 3 on Janua r y 25

Pr opo se d a s a mend ment to ISO 18 000-6C

Should be an ISO standa r d in ea r ly 2006

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METRO AG 2005

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Metro / Intermec next steps

Innova tion Center

Gen2 per formanc e tests

EN 302 208

future store

Upda te of existing inf r a str uc ture

RFID r oll ou t

Full co mmitment to suppo rt the Metr o Solu tion Tea m

EN 302 208 and Gen2

Multi Pr otocol envir on ment

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METRO Group Experience the future of retailing with the thirdlargest retailer in the world

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Documents

Nestle - Zaka (52)