Wal-Mart woos Canadian retailers for RFID plan

Wal-Mart Stores Inc. appears to be taking a new tack as its continues to roll out its much-touted radio frequency identification (RFID) technology supplier collaboration initiative.

Its subsidiary, Wal-Mart Canada Corp., has quietly been preparing to launch a modest pilot program to match the ongoing RFID program in the U.S. To woo suppliers to participate, Mississauga, Ontario-based Wal-Mart Canada has invited 16 companies to attend the Retail Council of Canada's annual STORE Conference in Toronto this week, said a company spokeswoman. At that event, they are expected to view a presentation on the project.

In contrast to the U.S. effort, participation in Canada will be voluntary, and there are no set deadlines for a go-live date. Under Wal-Mart's U.S. program, supplier participation has been mandatory, and some 300 suppliers are now shipping RFID-equipped cases and pallets to approximately 500 stores. The reason no mandate is needed in Canada is because those suppliers invited to take part are already involved in the supply chain program in the U.S., said the spokeswoman.

"In Canada just as in the U.S., RFID will benefit Wal-Mart and its suppliers by providing end-to-end visibility and highlighting opportunities, such as longer-than-expected dwell times [when cargo remains in transit], thus enabling either changes in process or setting changes in their [suppliers'] replenishment systems," she said. For instance, RFID could help a supplier see where its goods are in the supply chain and react to shipment delays for items that have a specific release date, such as books or videos.

The pilot is expected to start this fall in southern Ontario and run into 2007 as a small controlled experiment with a two-man RFID team overseeing it. Tagging will be at the case and pallet levels,using Electronic Product Code (EPC) standard Gen 2 tags -- the technology Wal-Mart is standardizing on. Currently, there are no readers in place in Canada to read data from the RFID chips.

The Wal-Mart Canada spokeswoman also noted there is no specific category of merchandise being targeted for RFID. In fact, the company is doing the pilot in southern Ontario because it will make for a good test market because of the diversity of population and the products consumers buy in that region.

The outcome is open. "We're just leveraging the benefits we're seeing in the U.S. and don't have anything planned beyond the pilot," she said. "Our plans are fluid at this point."