The Champion of RFID is ... Wal-Mart?
January 18, 2008 2:41 PM
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An example of an EPC RFID tag in use at Wal-Mart
Wal-Mart plans to strong-arm suppliers into using its RFID tagging system
RFID already has a
largely due to the unsavory prospects of
, possibly by
. There is a significant
public wariness to the technology
, which largely stems from these issues, which unfortunately causes people to often overlook its
practical business uses
By using RFID tags during shipping, pallets of goods can easily be located, identified and tracked as they move across the country. This can lead to great cost savings while enhancing the supply chain. Such devices operate in either the 433 MHz and 2.4 GHz frequency, and thus pose no more electromagnetic radiation concern to users than the myriad of
other wireless signals that surround us in our daily lives
adopted RFID early and has since pushed its suppliers to adopt the system, which it feels is revolutionizing its shipping processes. For three years now the company insisted its suppliers RFID tag shipping pallets for its Wal-Mart retail and Sam's Club warehouse stores.
Now Wal-Mart is using Sam's Club
as a proving ground for the new technology
, by economically forcing its suppliers to adopt the system. The new, more forceful, push will begin with Walmart's
DeSoto, Texas distribution center that distributes pallets to Sam's Club stores across the southwest. Starting January 30, all pallets entering the center must be RFID tagged or suppliers will face fines of $2 per untagged pallet.
An RFID tag costs about 20 cents to manufacturer.
Wal-Mart explains that the significantly larger fee is not designed to be punitive, but covers the costs of labor for Wal-Mart having to reprocess and tag the pallets themselves. The fee allows companies without existing RFID infrastructure to temporarily pay Wal-Mart to deal with this issue, giving the supplier time to adopt RFID logistics.
Sam's Clubs 700-stores accounted for $41.5 billion of Wal-Mart's $344.9 billion in revenues in 2007. The stores use fewer suppliers than the Wal-Mart retail chain, so the company sees them as an ideal proving ground for the technology.
The system and accompanying fines for non-comformers will be phased in at all 22 Wal-Mart distribution centers over the next three years.
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RE: Heck Yes
1/22/2008 2:31:17 PM
As great as this sounds, and yes I do think it's a good idea for them, I still question how well it will be used. And thats mostly because I have worked inside wal-mart, in fact I've worked inside most of the Wal-Marts in my state and surrounding states. I used to work as a vendor for a company that supplies to Wal-Mart, and as I'm sure any Wal-Mart employee will tell you, most Wal-Marts have some of the messiest back rooms I have ever seen.
Wanna find out where in the warehouse that pallet is? Check the computer.
Now see I read that and think great now the managers are going to have something to argue with you about when you tell them the pallet is NOT where the system says it is. I have been in Wal-Marts where I have had to throw product into a pile to un-burry my pallets that are covered in 6 ft deep piles of product.
So unless they plan to put RFID readers everywhere in the backroom that are capable of tracking pallets in real time and telling you in "real-time" a pallets location, then I see this only causing more trouble for Wal-Mart vendors. Back-room Wal-Mart employees and managers IMO are notorious for moving vendor pallets around on whim, and if it's left up to them to now ALSO track that move with an RFID tag, *laughs* I just don't see that happening.
Don't get me wrong, I think this is a great thing, and I applaud them for doing so, I just don't see it being used properly however.
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