1. METRO Group RFID Roll-out October 2005 Scott Medford, Vice President - RFID Intermec Technologies Corporation for Dr. Gerd Wolfram Managing Director MGI

2.  METRO AG 2005 1 January: Founding of the METRO Group Future Store Initiative April: Opening of the Extra Future Store, Rheinberg November: EPCglobal replaces Auto-ID center 2000 2003 2004 2005 January: Announcement of RFID rollout at NRF, NY May: 1st METRO Group RFID congress for suppliers, Cologne July: Opening of the METRO Group RFID Innovation Center, Neuss November: Start of RFID roll-out, 1st phase RFID at METRO Group – A Success Story January: 100-days balance of the RFID roll-out at the NRF, NY June: 2nd METRO Group RFID congress for suppliers, Cologne End of 2005: Start of RFID roll-out, 2nd phase

3.  METRO AG 2005 2 METRO Group Future Store Initiative IBM INTEL SAP T-SYSTEMS CISCO SYSTEMS COCA-COLA DHL SOLUTIONS HENKEL HEWLETT-PACKARD JOHNSON & JOHNSON KRAFT FOODS L‘ORÉAL LOYALTY PARTNER MICROSOFT NESTLÉ ORACLE PHILIPS PIRONET NDH PROCTER & GAMBLE SATO SYMBOL TECHNOLOGIES TRICON VISA WINCOR NIXDORF X-IDENT ADT DEUTSCHLAND ALGOTEC ALPHA TONTRÄGER AVERY DENNISON BIZERBA BOSTON CONSULTING GROUP CHECKPOINT SYSTEMS CHEP EYCKELER & MALT FEIG ELECTRONIC FUJITSU SIEMENS COMPUTERS GILLETTE HINTZPETER & PARTNER INTERMEC KURT SALMON ASSOCIATES LIEBHERR LOGOPAK SYSTEME METTLER TOLEDO MULTIQ NCR OAT SYSTEMS ONLINE SOFTWARE PAXAR SIEMENS BUSINESS SERVICES SONOPRESS TOMRA TOSHIBA TEC UPM RAFSEC WANZL WMS ZEBRA

4.  METRO AG 2005 3 Our Vision: RFID along the complete supply chain Production Storage Loading Order picking/additional merchandise Delivery notification (DESADV) Incoming merchandise Incoming merchandise - precise verification Reserve area Outgoing merchandise Incoming merchandise Inventory management Shelving Shelf management Manufacturer Distribution Warehouse Store/Outlet

5.  METRO AG 2005 4 Started November 2004 with around 20 industry partners, as well as selected warehouses, stores and branches of the METRO Group Launch of the roll-out Incoming/outgoing goods, inventory replenishment, automatic reconciliation Logistical units (pallets) and retail units (boxes) Individual items are not included in the RFID roll-out RFID transponders on... Focus of the roll-out METRO Group RFID-Roll-out

6.  METRO AG 2005 5 Phase 1: Participation of three METRO Group sales divisions since November 2004 Galeria Kaufhof Apparel/Textiles 3 Suppliers 5 DCs Real Grocery 12 Suppliers 11 Stores 3 DCs Metro Cash & Carry Grocery, General Merchandise 20 Suppliers 2 Stores 1 DC

7.  METRO AG 2005 6 Suppliers involved today DR. OETKER NESTLÉ MILASAN MAGGI PAPSTAR 3M FABER CASTELL JOHNSON & JOHNSON 3M SCOTCH GILLETTE GLAXOSMITHKLINE SCHWARZKOPF & HENKEL LEVER FABERGÉ TRIUMPH GERRY WEBER ESPRIT PAPSTAR KRAFT SARA LEE PAPSTAR TIP GILLETTE BRAUN HAKLE KIMBERLY SCA Suppliers involved Q2/3 2005 NESTLE PURINA HENKEL WASCHMITTEL COLGATE PALMOLIVE UNILEVER BESTFOODS SCHWARTAU MELITTA MEDION BEIERSDORF FUJITSU SIEMENS MATTEL BOSCH SIEMENS HAUSGERÄTE WAGNER PIZZA FREIBERGER L‘OREAL INTERUNION With availability of GEN 2 about 100 suppliers

8.  METRO AG 2005 7 RFID Rollout  Still a long way to go 3 Distribution Lines 111 RFID Gates 26 Supplier 879.979 EPC Reads 82.800 Items 79.100 Cases 218.108 Pallets METRO Group

9.  METRO AG 2005 8 Standard rollout portal setup Motion Sensor 4 antennas Reader Light stack Metal protection

10.  METRO AG 2005 9 Extra Rheinberg 14 Check Out 9 Exit Gates 4 Portals (e.g. Trash Door) 1 Standalone PC Customer Information RFID Server (Rack) RFID Controller for Check Out and Gates to SAP SII 2 Entry Gates Eth. Switch Standalone PC Extra Rheinberg 14 Check Out 9 Exit Gates 4 Portals (e.g. Trash Door) 1 Standalone PC Customer Information RFID Server (Rack) RFID Controller for Check Out and Gates to SAP SII 2 Entry Gates Standalone PC 14 Check Out 9 Exit Gates 4 Portals (e.g. Trash Door) 1 Standalone PC Customer Information to SAP SII 2 Entry Gates Ethernet Switch Standalone PC DC Essen 1 Portal (Dock Door) Standalone PC 1 Standalone PC DC Packing 1 Portal (Dock Door) Standalone PC 1 Standalone PC DC Packing

11.  METRO AG 2005 10  Reader and Motion detector - Controller  Gate- / PID -Messages RFID Server Backend System 1. Reader 2.… 10. 1.2.3.4. 20. 11. Reader 12.… 20. 21.22.23.24. … 39. 40. 21. Reader 22.… 29. 41.42.43.44. … 57. … 19. RFID Ctrl Reader  Scanning PID  Reading UID  Create a UID-/ PID- Message  Cache UID / PID  Gate Controller  Messaging Picking Zone Food, Non-Food, Cross-Docking RFID Ctrl  Reader and Motion detector - Controller  Gate- / PID -Messages

12.  METRO AG 2005 11 Pallet-level roll-out: instant data processing and verification Reading initiated by motion detector Tag Data (SSCC) transmitted to decentraliz ed edge node server via LAN network SSCC sent to Central Server; Matched with EDI data from the Merchandis e Manageme nt Systems "Green light" if Serial Shipping Container Code matches data from Merchandise Manage- ment Systems 32 1 4

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15.  METRO AG 2005 14 100 days of RFID – High reading accuracy in first trials Hanger goods conveyor: 99% Portal for incoming and outgoing goods: Varying results, up to 99% Returnable transport items: > 90% Stackable goods conveyor: 99%

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17.  METRO AG 2005 16 100 days of RFID – Technical challenges Installation and Optimi- zation of different setups for various transportation modes depending on product group (i.e. hanger goods conveyor, portal for incoming and outgoing goods) Integration of different backend systems Process improvement: matching of motion detectors and readers reader configuration tag is damaged, wrongly attached or missing DESADV too late/missing

18.  METRO AG 2005 17 NEXT Steps  Enhancement of suppliers and locations  Enhancement of RFID based processes (e.g. frontstore – backstore separation, RFID equipped forklifts, etc.)  Start with case level tagging prerequisite for all further rollout activities is the availability of Gen 2 products

19.  METRO AG 2005 18 Expected improvements of Gen 2 by end users  Worldwide standard  Price decline for RFID labels  Use the RFID advantages in global supply chains  Increasing investment safety  Better performance  Longer read ranges  Higher anti collission (about 600 Tags in a sec.)

20.  METRO AG 2005 19 EfficiencyRangeCostSecurityReliabilitySpeed User Requirements Dense reader installation Global unlicensed operation Minimal interference Up to 5 meter range Synchronized Timing Write protection Tag kill Secure forward link Data cloaking Verified write Error correction in air interface Wide operating temperature Eliminate ghost tags Many tags and late tags Fast singulated write Tag select by data filter

21.  METRO AG 2005 20 ISO 18000 and EPC Gen 2  On track toward ISO standard  ISO and EPC numbering system conflict resolved  One bit (bit 17 of PC bits) defines whether EPC or ISO (AFIs)  EPC UHF Gen 2 v 1.0.9 submitted to ISO SC 31/WG 4/SG 3 on January 25  Proposed as amendment to ISO 18000-6C  Should be an ISO standard in early 2006

22.  METRO AG 2005 21 Metro / Intermec next steps  Innovation Center  Gen2 performance tests  EN 302 208  future store  Update of existing infrastructure  RFID roll out  Full commitment to support the Metro Solution Team  EN 302 208 and Gen2  Multi Protocol environment

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29.  METRO AG 2005 28 METRO Group – Experience the future of retailing with the third largest retailer in the world

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