A Second Chance
The experiences of Daisy Brand and TI could provide helpful lessons to small and midsize suppliers, should Wal-Mart revive its mandate.
And analysts say that the recent launch of an RFID program at Wal-Mart unit Sam's Club, a warehouse retail chain, could signal an imminent resumption of the program.
Wildeman noted that more than half of Sam's Club's suppliers are also Wal-Mart suppliers. "If you're asking a large portion of those same suppliers to start tagging to avoid a penalty, is that a step in the overall Wal-Mart journey to get its suppliers to be compliant?" he asked.
Sam's Club announced its plan on January 7 and ordered that tags be attached to all pallets shipped to its Texas distribution facility by February 1.
Other distribution centers will come online as part of a graduated rollout over the next two and a half years.
Simley noted that untagged pallets that arrive at distribution centers after deadlines will be tagged by Wal-Mart employees. The suppliers will be charged a US$2 fee per missing tag, which could quickly become a major expense.
Meanwhile, the fully equipped Wal-Mart stores have RFID readers installed in receiving bays to keep track of shipments and in so-called transition areas to monitor products as they move from the storage room to the store floor, where workers use handheld readers.
At those Wal-Mart locations, the program seems to be working, according to a report released last month by researchers at the University of Arkansas.
The study of 16 Wal-Mart stores last year showed that RFID technology improved inventory accuracy by 13 per cent, compared with stores that lacked the technology. The study determined that the overall savings can be "measured in millions of dollars."
"There have been speed bumps ... but I don't think for a second that Wal-Mart is walking away from their RFID commitment," Fontanella said. "They'll slowly tighten things down in terms of compliance."