Japan uses e-tags to check food wastage at grocery stores; Offers discounts on products nearing expiry

NEW DELHI: Facing the daunting task of millions of tons of food going waste every year, Japan has undertaken an experiment to check food wastage with the help of radio frequency identification (RFID) tags, the technology we generally use at toll plazas to pay toll tax automatically or to enter restricted areas using RFID tags.

Can RFID tags, popularly known as electronics tags (e-tags) help reduce food wastage?

An experiment is underway in Japan’s convenience stores to make inventory management even smarter with these tags. Recently, during November and December RFID tags were used at four grocery stores in Japan to conduct the tests.

The system allows stores to offer discounts, other incentives on food items whose expiry date is fast approaching such as boxed meal and rice balls, and use smartphone apps to nudge customers.

The program focused on products whose sell-by or consume-by dates are approaching and offer premium points or discounts for the purchase of the products in these stores.

While saving manual labor in each store, it could decrease the food waste rate in Japan’s gigantic retail network.

The participating convenience stores affix RFID tags to products with shorter expiration dates and automatically manage the state of inventories and expiration dates of such products by taking advantage of RFID.

Japan is estimated to have an annual food loss of over six million tons. To tackle this issue, Japan is undertaking a wide range of measures to reduce its food losses.

And what added to the challenge to food security in many countries especially in the year 2020 was the outbreak of the COVID-19 pandemic that caused disruptions in supply chains, quarantine measures, the closure of public places, and the imposing of lockdowns, etc. It made the situation even more challenging while dealing with high levels of food waste.

The Ministry of Economy, Trade, and Industry (METI) have been advancing the FY2020 Project for Establishing Infrastructures for Enhancing Efficiency of Distribution and Creating Value Added Therein (Project for Food Waste Reduction in Convenience Stores Taking Advantage of IoT Technologies), which has been commissioned to ITOCHU Corporation.

As part of this project, METI conducted two demonstration tests in November and December last year for food waste reduction taking advantage of electronic tags equipped with radio-frequency identification (RFID) technology in convenience stores.

The first demonstration test in collaboration with FamilyMart Co., Ltd. was conducted from November 2-30, 2020 at FamilyMart Keio Presso Inn Ikebukuro Store and Famima!! ThinkPark Store (Osaki, Tokyo).

The second demonstration test was conducted in collaboration with Poplar Co., Ltd. from December 7-28, 2020 at Poplar Kishimojin Store, and Seikatsu Saika Akihabara Station Store.

Background and purpose of the project:

The distribution industry has been facing the advancement of serious labor shortages caused by the aging of society with fewer children being born, soaring labor costs in accordance with such shortages, and diverse consumer demand.

In addition, as the industry embraces many businesses in its supply chains of consumer goods, this situation is considered to make overall optimization of the industry difficult, resulting in food waste and returned goods.

In light of this situation, METI publicized two declarations jointly with operators of convenience store chains and with the Japan Association of Chain Drug Stores (JACDS), respectively: the “Plan to Introduce 100 Billion Electronic Tags for Products in Convenience Stores” in April 2017; and the “Declaration of Initiatives for Making Drug Stores Smarter” in March 2018.

Since then, METI has been advancing enhancement of efficiency in related supply chains taking advantage of RFID and other technologies.