Suddenly, fast growing drug store chain Walgreens is emerging as the leading retail adopter of RFID systems.
Globally, Germany’s Metro Stores group is generally recognized as the retail RFID leader, pushing an aggressive if, at times, stumbling effort to adopt RFID throughout its supply chain and store operations. Other retailers in Europe and Asia, especially among smaller chains, have also made progress.
Not so in the US, as giant Wal-Mart’s efforts have been mixed at best, and few other retailers have really jumped into the fray.
Walgreens, however, has quietly been making significant progress.
It is one of the few retailers that is really using RFID for distribution center operations. In 2008, it announced it had integrated RFID with its shipping, warehouse management and material handling operations at its Anderson, South Carolina distribution center.
This was a real substantial system deployment (not a pilot) that included 45 dock doors with integrated RFID readers that track more than 170,000 shipping totes and other reusable assets. Walgreens said, at the time, it expected the new DC to be 20% more productive than its previous generation of facilities, and some of those gains were attributable to RFID,
The RFID-based capabilities at that Walgreens DC include applications which verify that shipping totes contain the correct items for the order, that all totes required for the order are present, and that totes are loaded onto the truck in the proper order.
New Promotional Display Tracking System Eight Years in the Making
Last week, RFID systems vendor Goliath Solutions announced Walgreens was rolling out a system to manage promotional display execution at some 5000 of its stores nationwide.
Amazingly, the system rollout is the result of eight years of testing by Walgreens in partnership with Goliath. It is designed to solve the basic issue of promotional display execution that has plagued the consumer goods-to-retail supply chain for decades, and which companies such as Kimberly-Clark and Procter & Gamble have found that RFID can bring very impressive results.
What is the main problem RFID-based data can solve? Manual store processes often result in a failure to move promotional displays from the backroom when they should be on the floor; sometimes they never make it at all, sometimes the timing versus the advertising promotion is off, and other issues, like using the display inventory to fill regular shelf space.
Walgreens is said to have ultimately found that by achieving better execution based on RFID data, sales from promotional displays from 200-400%. Tests for several years have been carried out in-store with cosmetic maker Revlon and other suppliers.
(RFID and Automatic Identification Article - Continued Below)