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Procter & Gamble Halts Tagging of Promotional Displays

The company has informed its contract manufacturers to stop tagging displays bound for Wal-Mart immediately.
By Mark Roberti
Feb 13, 2009The Procter & Gamble Co. (P&G), a pioneer in the use of Electronic Product Code (EPC) technologies in the supply chain, has ceased placing EPC tags on promotional displays bound for Wal-Mart's RFID-enabled stores. Kim Zimmer, Procter & Gamble's leader for global EPC RFID technology and operations, sent an e-mail this week to the company's contract manufacturers, stating: "P&G has made the decision to end the EPC Display Tagging project at Wal-Mart, effective immediately."

The e-mail instructed contract manufacturers not to order any additional EPC RFID tags, and not to apply any tags they already have in stock. These companies were also asked to return to P&G's EPC lab the laptop, handheld RFID reader and wireless router that P&G had provided to enable them to capture EPC data before shipping displays to Wal-Mart, as well as any tags not already applied to displays.

Paul Fox, P&G's director of global external relations, confirms that his company has halted the tagging initiative. "The EPC has many potential applications throughout the supply chain that benefit not just manufacturers like Procter & Gamble but also retailers and, most importantly, shoppers," he says. "We've been working on these applications for close to 10 years. We have learned that to secure sustainable benefits, the use of EPC requires deep levels of collaboration between the manufacturer and the retailer, and a commitment to use the actionable visibility provided by the EPC to change business processes.

"One of the applications is improved merchandising effectiveness. And the work we conducted with Wal-Mart has shown that this use of the EPC can deliver improved promotional effectiveness, better sales and, most importantly, higher shopper satisfaction. That validation work with Wal-Mart is now complete. But we will continue to focus on working with our retail partners on collaborative programs that can benefit the shopper. "

Procter & Gamble, Fox says, is by no means abandoning its EPC efforts. The company and its contract manufacturers will continue to tag cases of some products being shipped to Wal-Mart.

"We remain firm believers that the EPC can have profound benefits for the retail/consumer packaged goods industry," he states. "While we have completed the validating of the use of the EPC for merchandising effectiveness, we continue to work with Wal-Mart on other EPC projects."

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