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A Guide to EPC RFID-Tagging Solutions for Sam's Club Suppliers

Tagging sellable units is a different ball game from tagging pallets. New compliance packages can help you get up to speed quickly or offset the cost by achieving internal benefits. Here's what you should know to choose the right product for your company's needs.
By Bob Violino
Mar 16, 2009—Sam's Club, the wholesale division of Wal-Mart Stores, asked its suppliers to tag pallets with ultrahigh-frequency RFID tags based on EPCglobal's Electronic Product Code standards beginning on Jan. 31, 2008. Suppliers that failed to do so would be charged $2 (or more) per pallet because Sam's Club would have to add the tags at its own distribution centers. Many suppliers chose the $2 route. Most suppliers that tagged their own pallets opted for the easiest and least expensive approach—"slap-and-ship," in which a label containing an EPC RFID tag with the correct serial number is manually placed on a case or pallet just before it's shipped.

Now Sam's Club suppliers are faced with another EPC RFID tagging mandate: Tag all "sellable units" that are bound for the wholesaler's DeSoto, Texas, distribution center by Oct. 31, 2009. And Sam's Club wants all of its suppliers to tag all sellable units by Oct. 31, 2010.

If you've taken the $2 or slap-and-ship route, you might not be worrying about how to meet these new tagging requirements. But you should be thinking about it—now. Tagging sellable units will require a lot more work than tagging pallets. Just how much work is involved will depend on how many stock-keeping units (SKUs) you ship to Sam's Club and in what quantities, as well as what kind of products you manufacture. Tagging items with metal or liquids will be more difficult than tagging, say, socks or bread.

October may be months away, but now is the time to put together a team to evaluate your company's processes and operations. This step is necessary to help you determine whether you'll approach the tagging requirements as the cost of doing business, or take additional steps to offset the cost by achieving internal benefits. That involves moving beyond slap-and-ship and integrating the RFID tagging system with your back-office applications to, for example, reduce out-of-stocks, optimize inventory management and improve order reconciliation.

The good news is that even if you haven't been thinking about how to meet Sam's Club's tagging requirements, a number of RFID vendors have. They've developed a variety of solutions—from slap-and-ship products to more complex packages that enable you to automate the tagging process—designed specifically to help Sam's Club suppliers become compliant. Some products will enable you to get up to speed quickly with a slap-and-slip tagging solution and then evolve into a more integrated system.

Here are some of the issues you should consider when choosing an EPC RFID tagging solution. Once you determine which approach best meets your company's needs, check out the table on page 32 to see which vendors offer that solution.
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