Wal-Marts RFID Deadline: A Chunky Mess
Campbell Soup Co. is two-thirds of the way through a technology overhaul. Next up: Meeting Wal-Mart's product-tracking deadline with the unproven technology RFID.You cant put a radio tag on a can of soup.
Thats just one technical tidbit Campbell Soup Co. is digesting as it investigates using so-called smart labels to better track its products from factory to retail outlet. It affects how Campbell will find a suitable way to put metallic tags on all its productsto satisfy its biggest customer, Wal-Mart Stores.
Wal-Mart accounts for 12 percent of Campbells annual sales of $6.7 billion. The worlds largest company has given Campbell and the rest of its 100 largest suppliers until January 2005 to track their products using tiny pieces of circuitry that contain identification codes and can be scanned by radio waves at any time.
At a meeting at its Bentonville, Ark., headquarters in November, Wal-Mart told suppliers that the requirement for using such radio-frequency identification (RFID) tags standsand that suppliers who comply early will have a leg up on those who dont. The company also said it started RFID trials at three distribution centers in Texas, with one unnamed supplier already agreeing to participate.
The problems with putting radio tags onto Campbells soup cans are twofold: the soup and the cans. Radio waves bounce off the cans and dont move through liquid well. That means that the Camden, N.J., company has no plans to track individual cans of chunky or thin broths. "You can tag cases and pallets, but not cans, says the companys chief information officer, Doreen Wright. Nevertheless, the tags are expected to be a big step up from the bar codes used today. For example, taking inventory at a warehouse, in a truck or supermarket aisle today can mean scanning each package individually. With tags, packages dont even need to be touched when a company takes stock. In theory, a retailer will know exactly how many cans, jars and boxes are on shelves or racks at any time. Radio waves can be sent out from stationary antennae that grab individual identification codes.
In distribution, this means Wal-Mart can know the exact contents of a pallet without ever opening it, speeding up routing and loading procedures.