Jun 17, 2004Wal-Mart met with its top 100 and "next 200" suppliers this week and spelled out in greater detail its plans for rolling out RFID technology.
“We discussed implementation plans with our next top 200 suppliers,” Linda Dillman, executive vice president and CIO for Wal-Mart Stores, said in a prepared statement. “Over the next 16 months, we also plan to significantly increase the number of Wal-Mart stores and Sam’s Club locations where customers can benefit from this revolutionary technology.”
Wal-Mart announced a year ago that it would require its top 100 suppliers to begin putting RFID tags carrying Electronic Product Codes (EPCs) onto pallets and cases beginning in January 2005. It later clarified that tagging would begin at three Wal-Mart distribution centers in Texas, which serve about 100 Wal-Mart stores.
At a meeting held this week outside of Bentonville, Ark., where Wal-Mart is based, the retailer told the 300 suppliers that by June 2005, RFID systems will be operating in up to six of its distribution centers, as well as in 250 of its stores. By October next year, Wal-Mart expects to be using EPC technology in up to 13 distribution centers and 600 Wal-Mart and Sam's Club stores.
By January 2006, Wal-Mart will require its next 200 top suppliers to begin tagging cases and pallets. The retailer is currently working with suppliers to determine in which geographical region the expanded EPC implementation will occur.
Wal-Mart went live with its initial EPC implementation on April 30 at a distribution center in Sanger, Texas. Eight suppliers are shipping cases and pallets of 21 products to the distribution center, and Wal-Mart is using the EPC tags to track the products as they are shipped on to seven local Wal-Mart Supercenters. The retailer says the initial implementation is progressing as planned.
“We’re seeing the positive results we expected,” Dillman said in the statement. “We also anticipated hitting a few minor bumps in the road, which has happened. The whole reason for a pilot is to fix any last-minute issues and clear the path for a smooth implementation. That’s what we’re doing, and we’re looking forward to January 2005 with great expectations.”
Sources tell RFID Journal that the retailer has not been able to get the 100 percent read rates it needs on conveyors, but that improvements in the placement of reader antennas and tags on products has pushed the read rates up. One source said that Wal-Mart is confident that 100 percent reads of cases on conveyors moving at 540 feet per minute is achievable.
Wal-Mart says it expects the number of suppliers tagging cases and pallets for the pilot to expand every few weeks. Therefore, consumers may soon see additional products—mainly large items such as bicycles and lawnmowers—displaying the EPCglobal symbol. The RFID tags will be placed on the packaging that gets thrown away, and Wal-Mart says it will notify consumers of the tag’s existence. Customers can retain the tag or discard it.
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