Wal-Marts RFID-Using Suppliers to Exceed 100

Wal-Mart expects to have more than 100 suppliers shipping products to the retailing giant with radio wave tracking devices by January, according to a top executive.

Simon Langford, Wal-Mart Stores Inc.s manager for RFID (radio frequency identification) strategies, told Baseline that the retailer will have 137 suppliers in compliance with its RFID requirements by its January 2005 deadline. Wal-Marts mandate requires the top consumer goods companies to tag cases and pallets with RFID tags.

“We will be in excess of our top 100 suppliers,” Langford said. “We have 37 volunteers.”

Langford declined to name the volunteers. Currently, Wal-Mart is undergoing pilots in the Dallas area with eight key suppliers: The Gillette Co., Hewlett-Packard Co., Johnson & Johnson, Kimberly-Clark, Kraft Foods, Nestle Purina PetCare Company, Procter & Gamble and Unilever.

Wal-Mart meets with its suppliers this week to outline next steps for its RFID initiatives.

Clickhereto read the Baseline case study “Wal-Marts Race for RFID.”

The suppliers in the Dallas pilots are thus far only tagging a handful of items for testing, Langford said, adding that its not viable for them to tag everything. For example, he noted that if a supplier was able to tag 80 percent of its goods by January, Wal-Mart would have discussions to help get the company to 100 percent. He said it was too premature to talk about fines.

Wal-Mart is currently observing data to see whats useful and what process changes the retailer would have to undergo to make the effort productive.

Most of the RFID data in Wal-Marts pilot are focused on locating an item and read rates, Langford said. Data is being shared with suppliers involved in the Dallas pilots. Langford said he isnt particularly concerned with the volume of data because the company will weed out a lot of it.

Langford said the pilots include goods such as shampoo and electronics that present a host of challenges.

“A lot of it is choosing the right tag to get the performance,” he said, adding that difficult items such as liquid and metal may need larger antennas on the tags. Paper items are considered easier to tag because the products dont interfere as much with radio waves.

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