Wal-Mart plans RFID shipments to 600 stores by October, CIO Dillman say

Wal-Mart Stores Inc. is on course to exceed its planned schedule for rolling out its RFID shipment-tracking program, with104 Wal-Mart stores, 36 Sam’s Club stores, three distribution centers and more than 100 suppliers participating by the end of this month, CIO Linda Dillman said this week at the National Retail Federation’s Redefining Retail conference and trade show in New York.

By October, she added, Wal-Mart expects to have 600 stores and 12 distribution centers processing incoming shipments with RFID. RFID, or radio frequency identification, uses a system of radio frequency tags and readers to track shipments through a supply chain, providing access to shipment status over a web-based network.

Dillman said Wal-Mart’s RFID network has been getting usable and accurate reads of tags 95% of the time. Since starting its RFID pilot last fall, it has processed more than 7,161 pallets and 210,000 cases.

In addition to learning how RFID technology works, Wal-Mart is also learning how it can support and improve supply chain business processes. For example, Wal-Mart executives can now see in a central records system what products are in each the back-room warehouses of individual stores. “Now we’re telling stores, ‘You have too much inventory in your back room, and you need to take it to the selling floor now,’” Dillman said.

At the same time, Wal-Mart can check store inventory records to see if it already has products that a manager wants to order. Or if it notices excessive inventory in a store, it will review order records to see if it needs to reduce orders of a certain product.

Colin Cobain, IT director for U.K.-based retailer Tesco plc, told the same NRF audience that Tesco expects to be using RFID to track shipments to more than 1,400 stores and 30 distribution centers by the end of this year. In an on-stage demonstration using actual pallets and RFID tags and readers, Cobain showed how an incoming pallet passing through an RFID reader would set off a red light to indicate that the pallet included products that needed to be unloaded and displayed on store shelves immediately.