RFID creates buzz at NACDS conference

Drug Store News,  March 22, 2004  

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PHOENIX -- Wal-Mart's announcement last June that its suppliers must convert to radio frequency identification technology by 2005 caused a major reaction throughout the retail industry. Since then, several top retailers have issued a similar mantra, including Target and, most recently, Albertsons.

And so the continued buzz about RFID became the key topic of conversation for more than 400 supply chain executives that converged here Feb. 29 to address major issues and trends at the National Association of Chain Drug Stores Distribution & Logistics Conference.

Albertsons on March 5 announced that it expects its top 100 suppliers to participate in its RFID program at the case and pallet levels by April 2005. "We are confident that RFID technology will further enhance our service to customers by improving consumer-demand chain management," said Bob Dunst, executive vice president and chief technology officer. "We'll be able to instantly locate products as they flow through our supply chain.

Last month, Target announced that it would require vendors to use RFID tags on all pallets and cases by late spring 2005.

The conference featured eight educational sessions, two motivational speakers and an exhibit floor with more than 70 suppliers. It blended supply chain executives with transportation and merchandising executives, supporting the opinion that initiatives are more team efforts than solely one department implementing a new back-of-the-house system.

One panel, moderated by Nick Parnaby, global director of member development for the Worldwide Retail Exchange, focused on data synchronization.

Said conference chairman Kevin Smith, senior vice president of supply chain and logistics at CVS, regarding starting data synchronization, Standards are still in flux, and there needs to be agreement as to what it is the industry is trying to accomplish." He said there has been no return on investment for CVS to date, and the retailer is still making significant investments in data synchronization, but it has helped to clean up, streamline and improve data.

Said Patrick Looby, manager of supply chain services at Walgreens: "Everyone has to clean up their data sooner or later, whether you have 200 or 2,500 SKUs. It's not a quick-fix project or plug-and-play system, but the results are phenomenal."

When asked if suppliers have a choice regarding data synchronization, Dinesh Rawlley, information technology director for Playtex Products, replied, "It's not glamorous, but you have to do it."

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