Wal-Mart has told its top 100 suppliers to embed Radio Frequency Identification (RFID) tags in products by January 2005, as the world's biggest company aims to kick-start a retail revolution.
The decision is the first clear indication that RFID will become the norm in the retail industry over the next few years.
Wal-Mart unveiled its plans to suppliers earlier this month, and believes that the change will assist in driving efficiencies in the supply chain and make it easier to track products, helping to improve availability.
Chief information officer Linda Dillman said that the US giant is asking all suppliers to use the new technology, although it will not be compulsory in the first instance. But in the future 'it will become a requirement to do business with Wal-Mart'.
At present, RFID costs 25 to 30 cents (15p to 18p) per tag, and Wal-Mart believes that a full-scale roll-out will not happen until the tags come down to approximately 5 cents (3p). Wal-Mart is to brief suppliers further on RFID during the fourth quarter, when it will reveal its expectations.
RFID has also been tested in the UK. Both Asda and Tesco have piloted the technology on CDs and DVDs. Marks & Spencer is to test RFID on clothing this autumn.
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