To push ahead using RFID to track shipments throughout its supply chain, Wal-Mart Stores Inc. is working closely with suppliers to share ideas on RFID implementation. Although it has mandated its top 100 suppliers be set up for RFID by next January, 128 suppliers are already moving ahead with RFID projects, Simon Langford, Wal-Mart’s RFID strategy manager, tells Internet Retailer.
Langford adds that by sharing information on RFID projects among its suppliers, Wal-Mart is learning how to benefit from RFID in ways that minimize the impact on network infrastructure. “The biggest ideas we’ve shared are how to approach this in a simple way that allows us to benefit from this technology without having to re-engineer back-end systems and applications, such as inventory management,” he says.
Langford adds that Wal-Mart is helping to promote RFID projects with its suppliers by dedicating support teams of Wal-Mart executives and RFID technology specialists for each participating supplier. “We’re looking at this collaboratively,” he says.
Langford notes that the 128 suppliers already participating in RFID projects include at least two dozen smaller companies along with its 100 top tier suppliers, and that the 128 are in various stages of research, testing and deploying RFID systems. In a sort of dry run for its January 2005 mandate, Wal-Mart and several suppliers will operate a pilot RFID system by the end of the first quarter in Wal-Mart’s three Dallas-area distribution centers, testing the operation of RFID infrastructure and data flow. “We’ll be replicating our RFID position for January 2005,” he says.
RFID technology uses a system of RFID tags mounted on cases, pallets or even individual products. When shipments enter distribution centers or stores, electronic devices read the tags and pass information on their shipment status to retail managers. Eventually, the RFID data will flow over a web-based Electronic Product Code network to provide universal access to authorized users.
“One of our biggest opportunities is to fill the visibility gaps we have now in our supply chain,” Langford says, “so we have visibility of what’s arriving in our distribution centers, what’s shipping to our stores and what we’re receiving in stores.”
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