Wal-Mart readies next wave of suppliers for RFID

Wal-Mart readies next wave of suppliers for RFID    As the January deadline for Wal-Mart Stores’ largest suppliers to begin tracking shipments with radio frequency identification tags approaches, Wal-Mart is preparing a second wave of suppliers to adopt the technology by 2006.
   Wal-Mart and its top 100 suppliers are on track to implement RFID by 2005. This summer the retail giant brought in its next set of 200 suppliers to help put together tagging plans as they work towards their own January 2006 start date for affixing the coded electronic license plates to cases and pallets, said Kerry Pauling, director of information systems for Wal-Mart. The company is willing to work one on one with suppliers to find the right mix of RFID technologies to integrate with their information systems and operational requirements, he added.
   The Bentonville, Ark.-based retailer has been using RFID in the Dallas area since April, when it began a test along with eight major suppliers to track more than 20 items shipped through one regional distribution center and seven stores.
   Wal-Mart is currently installing short-range RFID radio signal readers at receiving doors, sales floor entrances, and trash compactors so it can track the flow of products in three distribution centers, 150 stores and Sam’s Club outlets by January, Pauling said during a symposium at the annual Council of Logistics Management conference in Philadelphia this week.
   About 12 distribution centers and 600 stores and clubs will be RFID-enabled in 2006 as Wal-Mart continues its domestic expansion, he said.
   “Our goal by the end of 2006 is to have all our supplier base in some form of RFID initiative” and in the process of being RFID compliant, Pauling said.
   Wal-Mart also plans to develop an international strategy for rolling out RFID to its stores in other countries.
   “We have no date at this time for 100 percent compliance everywhere,” he added.
   Pauling tried to correct some misperceptions about Wal-Mart’s RFID mandate, saying the January 2005 launch does not apply to all stores and distribution centers or that all cases and pallets would be identified by radio frequency.
   “We expect 65 percent of our volume will be tagged” by the time the automated inventory control system goes live, he said.
   Wal-Mart’s compliance specifications call for it to be able to read 100 percent of cases moving on high-speed conveyors and 100 percent of pallets moving through its pallet portals, but “not 100 percent of cases on pallets have to be read,” he clarified.
   The Wal-Mart pilot test is producing successful read rates in the upper 90 percentile.