Meeting the Sam’s Club mandate

Bob Trebilcock, Modern Materials Handling -- Logistics Management, 4/24/2008

Editor’s note: This story originally appeared on Modern Materials Handling’s Company Briefings blog.

RFID in the retail space has been quiet for the last few years. But since Sam’s Club announced its plans for RFID, there is renewed energy and interest among suppliers who will have to meet the new requirements.

 There are at least two key differences this time around, compared to the Wal-Mart RFID requirement of a few year’s ago, says Bill Bulzoni, Zebra Technologies director of Global Business Development.

 First, Sam’s Club’s plans include a move to item-level tagging in relatively short order. “Wal-Mart wanted to tag at the case and pallet level, so suppliers could make that work with off-line slap and ship solutions,” says Bulzoni. “The Sam’s Club roll out requires a system that can scale as you move from pallets to cases to item.”

 Second, Sam’s Club suppliers face fees of up to $3 a pallet for non-compliance, penalties that were never part of the Wal-Mart initiative. “That means it can get expensive to ignore Sam’s Club,” says Bulzoni.

 With that in mind, Bulzoni offers Sam’s Club suppliers 10 tips to meet the new mandate.

 1. Start early. It takes time to research the technology, select the right partners and align the organization.

 2. Choose supplies carefully. If your tags don’t work, you risk missing deadlines for compliance.

 3. Determine the where and how of smart labeling. Will you incorporate RFID tags into your current shipping labels or add new label formats? Where are labels best placed on the carton and pallet?

 4. Select the right partners. Choosing the right partners is critical for RFID success. Look for companies that are experienced and fit well with your existing applications and business processes.

 5. Start small and simple, then expand. Starting small makes the project much less intimidating and reduces costs by saving on mistakes that could disrupt operations.

 6. Test, test, test. Tags perform differently with different materials, at different locations and at different channels within the UHF spectrum. It is important to thoroughly test early in the process to avoid creating more issues as implementations scale up in volume.

 7. If you can, plan RFID from the ground up. If your company will be involved in new construction, implementing new applications or upgrading IT infrastructure, gaining experience with RFID and factoring it into your plans is a very good idea.

 8. Utilize the data. It is important to transport and translate the RFID data flow to upstream business applications for true ROI from an RFID implementation.

 9. Look beyond compliance for ROI. Leveraging compliance learnings is only the first step. When RFID data is leveraged to improve business processes, companies experience significant payback and ROI.

 10. Recognize that RFID is still a moving target and plan for change. As with any emerging technology, there will continue to be advancements. Therefore, the initial vendor relationships you establish will be critical as your implementation matures. By choosing strong and knowledgeable partners today, end users can ensure they stay abreast of the many developments in RFID tomorrow.