McDonald’s China and Cainiao partner on RFID chips to improve supply chain efficiencies
- A trial project of the RFID technology helped reduce the time needed for stocktaking each day from 1 hour to 15 minutes for restaurants
- The deal between McDonald’s China and Cainiao comes as the logistics firm prepares for an initial public offering in Hong Kong
McDonald’s China unit has partnered with Cainiao, Alibaba Group Holding’s logistics business, to improve supply chain efficiency using radio frequency identification (RFID) chips and other technologies.
Under a deal signed on Thursday, McDonald’s China will deploy Cainiao’s RFID technology in its supply chain with built-in tags on food packages, allowing the company to track products from factories to restaurants, according to a statement by the Hangzhou-based logistics firm.
A trial project of the RFID technology helped reduce the time needed for stocktaking each day from 1 hour to 15 minutes for restaurants while improving the accuracy of inventory data by 30 per cent, according to the statement.
RFID is a third-generation identification technology, after bar codes and QR codes, and has been widely adopted in supply chain tracking. With a built-in microchip, data is transmitted through radio frequency signals.
Apart from deploying RFID technology to improve efficiency in inventory and logistics, McDonald’s and Cainiao will also explore digitisation and automation technologies in the supply chain, Cainiao said.
Cainiao aims to raise at least US$1 billion, subject to market conditions, according to sources cited in a Post report that month. The listing is part of a group-wide restructuring of Alibaba as the e-commerce titan seeks to free up decision- making amid increased competition across its businesses. Alibaba also owns the South China Morning Post.