Walmart RFID: Linda Dillman Shares Status Update

Linda Dillman shares interim results on the Walmart RFID program ...

Walmart RFID: Linda Dillman Shares Status Update: Via WalMart Stores, Inc.: WalMart Improves On-Shelf Availability Through the Use of Electronic Product Codes

... "WalMart customers found items they wanted in stock more often due to the retailer's use of electronic product codes (EPCs) powered by radio frequency identification (RFID) technology when compared to control stores. This is according to an independent University of Arkansas study's initial findings. Researchers at the University of Arkansas found a 16 percent reduction in out-of-stocks. Additionally, the study also showed that out-of-stock items with EPCs were replenished three times faster than comparable items using standard bar code technology. Equally important, WalMart experienced a meaningful reduction in manual orders resulting in a reduction of excess inventory. This is no longer a take-it-on-faith initiative, said Linda Dillman, executive vice president and CIO for Wal-Mart. This study provides conclusive evidence that EPCs increase how often we put products in the hands of customers who want to buy them, making it a win for shoppers, suppliers and retailers. ...

As part of its standard processes, WalMart has focused on driving improved product availability for its customers through a series of initiatives unrelated to RFID technology. The research was structured to isolate the impact of RFID to be able show the improvements directly attributable to the RFID process improvements. The study showed RFID-enabled stores were 63 percent more effective in replenishing out-of-stocks than the control stores, Dillman said. The WalMart RFID team knew that this technology would have a huge impact on out-of-stocks. Now we have an independent study that confirms RFID has a significant impact in retailing, Dillman continued. However, we are not stopping there. This is only one of many changes that RFID will bring. We are already working on initiatives and enhancements that will build on this success. The 16 percent reduction in merchandise out-of-stocks was determined by physically scanning out-of-stocks at the shelf every day. A baseline was established and this was then compared to the number of out-of-stocks in both sets of stores once the RFID technology was enabled in the pilot stores, explained Hardgrave. The net result of the impact of RFID, removing any other influences, was a reduction of 16 percent in the occurrences of products being out-of-stock on the shelf. " ...