The personal hygiene products manufacturer has taken delivery of 500 million tags from maker Alien Technology. Gillette would not reveal the cost of the RFID units, but the scale of the trials - the largest to date - indicates that the unit price of the tags has made the technology economically viable for the company.
The trials will involve selected Gillette products. The company will use radio tags together with Smartshelf software, developed at the Massachusetts Institute of Technology, which will monitor the status of stock levels in stores.
RFID tags have been hailed as a replacement for bar-codes, since they can be read without the need for a line-of-sight scanner, but until recently the cost has been too high for most businesses. Radio receivers in warehouses and shops allow goods to be tracked from manufacture to sale, reducing supply-chain and inventory costs through automatic stock management.
Analyst Simon Bragg of ARC Consulting said, "The price of RFID needs to come down more for widespread adoption, but for Gillette, which suffers lots of shrinkage [theft] in the supply chain, it is economically viable. For small, compact high-value items it makes sense."