Retailers and suppliers recognize the significance of the supply chain. Getting goods to customers quickly and smoothly whether purchased in-store or on-line is a worthy goal. To do that, achieving better inventory control is a must.
For Walmart, RFID (Radio Frequency Identification) offers unparalleled inventory management because it clears up discrepancies between what the electronic records show as inventory and what the actual inventory is. Overstocks and out-of-stocks decrease, and customer satisfaction increases!
RFID is a technology that uses radio waves to identify a tagged object. It’s used in several commercial and industrial applications — from tracking items in a supply chain to tracking books checked out of the library.
It allows every single item to be tracked and tells where that item is located and also how many such items are available for purchase. This really helps manage inventory, and it’s done with very little human intervention.
If you supply Walmart with a product that falls under its growing list of items requiring an RFID tag, you have to place an approved RFID tag on each item before you ship it to a Walmart store or distribution center.
Because RFID is highly effective.
RFID allows Walmart to manage its inventory better. Its stores and distribution centers handle huge amounts of product, so even small errors can cost thousands of dollars.
Walmart RFID improves managing that inventory and reduces errors like the bullwhip effect (when small swings in demand erroneously become big fluctuations).
It also lets customers know if something is in stock and where it’s located in the store —and that makes Walmart customers happier!
Required RFID labels are added to more and more Walmart departments because the system offers so many advantages. Almost all of General Merchandise now requires RFID labels.
As a tool to manage inventory, an RFID tag or label is placed on an item so it can do three things:
A wireless technology, RFID tags or labels are encoded with digital data and put onto store products. The data on the tag can be read, monitored, and captured via radio waves. The data can be sent from the tag to a reader (giving accurate, real-time tracking data of inventory) and then on to a database. All of this is done with little or no human intervention.
An RFID system consists of a tag with a computer chip that’s attached to a product and contains information about it, an antenna (which is part of the tag), a reader (sometimes called a transceiver or an interrogator), and a computer database (or transponder).
The antenna and reader work together to send radio waves filled with information from the tag to a computer database. When the computer database receives its signal through the reader, it sends information back to the reader, and the reader then decodes the raw data.
There are two types of RFID readers: fixed and mobile. Fixed readers are installed in a specific place (for example, a check-out zone that reads the tags on the items in a cart). Mobile readers are handheld and can be used in aisles, at checkout, or anywhere. RFID Walmart uses both types of readers at its stores and distribution centers.
Both tools help companies track their products and store information. High-ticket suppliers often prefer RFID while some suppliers of lower-priced items and food have often been satisfied with the barcode system.
Even though the RFID system and barcode system are similar, there are some significant differences.
Suppliers who must outfit each product with an approved RFID tag before shipping need to carefully follow Walmart’s instructions. Here are some guidelines to keep in mind:
For complete information about tag placement, refer to the 32-page Implementation Guideline provided by GS1.
* Auburn University RFID Lab’s ALEC program is to help suppliers ensure that their RFID-tagged item meets all the industry requirements. You can reach them here.
While it’s true that RFID adds another hoop for suppliers to jump through, it also offers many pluses. It is actually a joint venture: The supplier invests in tagging, and Walmart invests in hardware, software, and labor to collect the tags data.
When the cost of RFID is compared with the positives it offers, its advantages come through loud and clear.. Walmart and RFID have proven themselves to be a winning combination.
If you need guidance regarding RFID, our team of experts can be a great help as well as a source of confidence. Each member of our team has worked at Walmart or been a supplier to Walmart; some have been both. We are intimately familiar with RFID and its requirements. Contact us for more information.
Walmart continues to expand its use of RFID labels and is researching ways to add labels to those few products (such as those made of metal) that are difficult to tag. The goal is to eventually have all products using RFID labels. RFID is here to stay.
Note: Don’t forget to request a FREE consultation about your RFID issues. The 8th & Walton team is here to help you.