Responding to Wal-Mart's RFID Mandate - ARC Advisory Group
Responding to Wal-Mart's RFID Mandate - ARC Advisory Group
Responding to Wal-Mart's RFID Mandate - ARC Advisory Group
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<strong>ARC</strong> Strategies • December 2003<br />
• Instead of outfitting every dock door with readers, a single gateway<br />
with readers can be constructed. Pallets are driven through the gateway<br />
before they’re taken <strong>to</strong> their designated door. Fewer readers are<br />
required with this configuration.<br />
• Costs depend on whether it is an older WMS, legacy solution, or a<br />
modern WMS. Modern WMS solutions support the work flows described<br />
above.<br />
• Older WMS and legacy solutions do not support the workflows described<br />
above and thus may require cus<strong>to</strong>mization (est. $50,000).<br />
• WMS solutions often use RF devices. Older RF systems that operate in<br />
the 900 Mhz range may need <strong>to</strong> be replaced because they will cause<br />
reader interference.<br />
• The key drawback of doing this in the DC is wasted labor. Cases are<br />
palletized at the fac<strong>to</strong>ry, then depalletized at the DC <strong>to</strong> enable tagging,<br />
then repalletized.<br />
• The key benefit is that warehouse personnel are use <strong>to</strong> Value Added<br />
Service processes, fac<strong>to</strong>ry personnel are not.<br />
Considerations and Strategies for the Fac<strong>to</strong>ry Pilot<br />
• Case tags are applied at high speed, in line, on a fac<strong>to</strong>ry production line<br />
conveyor. The barcode/encoder must be <strong>to</strong>ld which items require<br />
which tags (bar code, barcode + <strong>RFID</strong>, or more expensive bar code<br />
<strong>RFID</strong> tags with larger antennas).<br />
• The tag/bar code applica<strong>to</strong>r should be able <strong>to</strong> apply tags <strong>to</strong> different<br />
size and shaped packages and apply the tag on a specific location on the<br />
case/car<strong>to</strong>n <strong>to</strong> insure that it can be read reliably.<br />
• When tags are applied at the DC, the actual ship <strong>to</strong> locations are<br />
known. Because of manufacturing lead times, tags may have <strong>to</strong> be applied<br />
in the fac<strong>to</strong>ry before it is known exactly how many of a certain<br />
SKU will need <strong>RFID</strong> tags. Err on the high side! Apply more tags than<br />
are needed, perhaps 10 <strong>to</strong> 20 percent more than are forecast.<br />
• Many of <strong>Wal</strong>-Mart’s <strong>to</strong>p suppliers participate in Collaborative Planning<br />
Forecasting and Replenishment (CPFR) or VMI programs. These processes,<br />
in conjunction with the Sales and Operations Planning (S&OP)<br />
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