Wal-Mart expects its next 300 largest suppliers to tag their shipments at the pallet level by the end of 2007. To help those facing compliance mandates, Zebra offers the following 10 best practices from successful RFID implementations, featuring Wal-Mart suppliers Beaver Street Fisheries, a distributor of fish and seafood; Pacific Cycle; and Victory Land Group, a large furniture importer.
- Start early. All three companies began their RFID programs early. In fact, both Victory Land and Beaver Street had 2006 deadlines but targeted 2005 instead. Pacific Cycle started its program early enough in 2004 to be three months ahead of the 2005 deadline. All three companies noted that the early start was necessary to research the technology, determine partners with whom to work and assimilate the learnings into their organizations.
- Don't underestimate the need to get the supplies right. When the first round of Wal-Mart suppliers were selecting tags, their choices were limited to only two vendors. Now, there are at least five major providers of tags—Avery Dennison, Alien, Symbol, Raflatec and Texas Instruments—all providing a variety of antenna/chip designs. The components of smart media—including tags, label material, backings, adhesives, etc.—need to come together precisely so that the finished product encodes properly, performs as needed and provides the wear and tear required over its life cycle. Getting smart labels right could be the single-most important decision of your entire RFID implementation because they carry electronic product code (EPC) data. If the smart labels do not work, all the rest of your RFID architecture will not make up for it.
- Complete due diligence when re-searching RFID offerings. RFID implementations can require a variety of readers and/or tags based on the types of items being read, how far the readers need to be from the tags and the speed at which items are moving past the readers.
For example, Beaver Street faced a significant hurdle in finding the right tags for its fresh and frozen products. The density and moisture content of each package of frozen fish is not identical, which makes reading performance inconsistent and could result in unreadable cases. The company's first step was to spend significant time finding the best types of tags for its products.
In addition, if your company plans to use its existing barcode label formats as the basis for compliance smart labels, their size and layout will set requirements for the size, thickness and antenna design of the tags. Because of these interdependencies, all decisions on RFID components—readers, printers/encoders, supplies, etc.—should be synergistic. A good place to start is to have a variety of tags tested on your products at an independent RFID lab. Once tags are selected, choose hardware that has a solid track record in supporting those tag types.
- Get the right partners. Finding the best fit of partners with whom to work depends on a number of considerations, including level of expertise, cost, availability of personnel, location and that ephemeral quality called "chemistry." Pacific Cycle's decision to partner with Zebra, SAP and Peak Technologies was based on the fact that the company was running SAP. Zebra RFID printers/encoders are already integrated with SAP, and Peak is a strong partner of both SAP and Zebra.
Both Beaver Street and Victory Land were satisfied with their Zebra barcode products and requested their integrators, Danby Group and R4 Global Solutions, to work with Zebra on RFID.
- Start small and simple and expand from there. Beaver Street started its RFID pilot with only three products. Victory Land began by tagging only a single model of bar stool. Pacific Cycle started with a basic slap-and-ship label application on only four products. All three companies agreed that starting small made the project a lot less intimidating and reduced costs by saving on mistakes that could disrupt operations.
Victory Land's Hudson Magloire went into the RFID project with some concerns. "You hear so much about the obstacles and difficulties in getting good read rates, having to make big changes to your business and spending a lot to put in a system," he says. "That perception changed the further we went along in our project. When you start doing it, it's a lot easier than it seemed it would be."
- Test, test, test. Because tags perform differently with different materials, at different locations, and at different channels within the UHF spectrum, it is important to complete thorough testing early in the process to avoid creating more issues as implementations scale up in volume.
- If you can, plan RFID from the ground up. Victory Land volunteered for early inclusion in Wal-Mart's compliance mandate in part because it was breaking ground on a new distribution center.
"We knew we wanted to take advantage of RFID technology internally," says Magloire. "We would learn about RFID and gain experience while tagging for Wal-Mart, and this would help us in building a competitive edge over non-RFID suppliers."
If your company will be involved in new construction or remodeling, implementing new applications or upgrading IT infrastructure, gaining experience with RFID and factoring it into your plans is a very good idea.
- Use the data. Soon after Pacific Cycle completed its pilot, staff realized that they had gained an understanding of RFID's physical requirements but no insights from the data. The information went into a database and just sat there until a company initiative was launched to translate RFID data upstream.
- Look beyond compliance for ROI. To leverage its RFID implementation, Beaver Street plans to use shipment data collected via RFID to automatically create a bill of lading and advance shipping notice for EDI transmission. Another goal is to push compliance labeling to worldwide suppliers.
Similarly, Victory Land plans to use RFID information for its planning and suppliers.
All three companies agree that leveraging compliance learnings is only the first step to ROI, and extending the technology internally requires business process and software re-engineering. But the payback is clear.
- Recognize that RFID is still a moving target and plan for change. Increasing numbers of companies plan to use RFID for compliance initiatives and for closed-loop applications to improve internal business processes. Initiatives like RFID asset and inventory tracking, work-in-process control, access control and patient and patron monitoring are already underway at many companies.
Academic institutions are setting up RFID labs and expanding research projects, and more vendors are entering the market. Global standards are being settled.
Certainly the RFID architecture in place today will change over the next 18 months, but that's to be expected. What's important to realize is that the vendor relationships you establish today will become more critical as implementations mature. By choosing strong and knowledgeable partners today, companies can ensure they're prepared for the many developments in RFID tomorrow.