RFID in Wal-Mart

Presented By:
 Introduction
• Wal-Mart is the largest retailer and one of
the largest companies in the world based
on revenue.
• By the end of 2005, Wal-Mart had opened
5246 stores ,551 clubs, and 1587
worldwide distribution centers.
• Wal-Mart, the world’s largest retailer ,
was well known for its proficient supply
chain practices in the retail industry.
• Efficiency in Supply chain helps Wal-Mart
to focus on low price and customer
satisfaction .
 “The greatest pleasure in life is doing
what other people say can’t be done.
That was the telltale sign. Wal-Mart relies
on information to run its business and
depends on technology as the enabler to
meet the customer’s needs”.

-Sam Walton, Founder, Wal-

Mart
 RFID in Wal-Mart's
•
Supply chain
RFID is low cost Radio Frequency Identification system
which requires minimum human intervention to carry
out tasks ranging from billing to materials tracking and
supply chain management.
• It is a small wireless device which can store good
amount of data and can virtually be tagged to anything.
• RFID had the potential of providing the retailers with the
right product at the right place and right time thus
maximizing sales and profits
• RFID increased visibility throughout the supply chain ,
thereby reducing ‘out of stocks’ by 16%.
 RFID over Bar-Code
• Ability to read without line-of-sight
• Store large amount of data
• Ability to reuse
• RFID uses a serialized numbering scheme
 Decision Problem

“Whether to implement RFID

technology in Wal-Mart at this time
to improve its Supply Chain
efficiency so as to maintain its low
cost leadership among Retailers”.
 Major Issues in RFID
implementation
• Global standards
• Technology problems – Low read range distance ,
Damaged RFID tags
• High Implementation cost
• Data management
• Lack of Knowledge about RFID Technology
• Goals and Expectations were not defined
 SWOT Analysis
Opportunities:
• To capture global markets as a low cost retailer which
is yet to be served by achieving global standards for
efficient supply chain.

Threats:
• Technological Failure
• Imitation of technology by competitors
 Strengths:
• Efficient Supply chain
• Low Price & Customer oriented
• Own Transportation System
• Save Labor cost
• Quality

Weakness:
• Lack of Expertise
• Not Possible for low valued items
• Trouble in handling metals and liquids
• Lesser Speed
 Macro environment
Analysis
Industry:
• Second largest industry in USA.
• Low profit margin .

Technological:
• Intense focus
• Use technology as a platform to bring improvements in Supply
Chain.
• Rapid adoption of the technology
 Sociocultural:

• Time is most important for customers.

• People are technologically advanced

Competitive:

• Fierce competition.
• Cost of goods are 5 to 10% lesser than the competitors.
• Home Depot, Sears holdings Corporation,Roebuck,Kmart.
 Marketing Strategy
• Everyday Low prices
• Focus on efficient supply chain (IT
enabled )
• Availability of Products
• Proper Inventory Control
 Recommendations
• Wal-Mart should redefine the scope of its RFID by
narrowing the scope of products to those with
limited amounts of metal and liquid.
• Wal mart should provide proper knowledge
about RFID to their suppliers
• Wal mart should achieve a standard format for
all its suppliers while implementing RFID
Thank You