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RFID E-Commerce Paper - Essay Example

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RFID Essay [Date] [Word Count] [Name of Student] [Name of Institution] Introduction Long queues are perhaps the major challenge for both retail stores and their customers. Fortunately, long queues could be a thing of the past if retail shops deploy a technology referred to as Radio Frequency Identification (RFID) tags to replace the Universal Product Code (UPC) system currently used on consumer products…
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Download file to see previous pages Instead, each item put in a cart is communicated to an electronic reader and rung instantly. Once the reader receives the communication about the items picked it connects to a larger network then sends the same information to the retailers and the manufacturers of the items picked. After being notified, the manufacturers and retailers inform the shopper’s bank and the cost of the goods bought are deducted from the shopper’s account. Although initially majorly used to track cattle, RFID is today used to track consumer products from the moment they are manufactured to the time they reach the shopping cart. The other uses to which the RFID technology is put include tracking airline passengers, vehicles, pets and Alzheimer's patients. Its advantages notwithstanding, RFID technologies have been criticized by privacy watchers as it may be exploited by individuals and agencies to infringe on the privacy of the public by tracking peoples’ preferences and tastes. Worth noting is that research has shown that more than 60 percent of businesses have not yet started on RFID tagging technologies. In addition, research reports indicate that even the businesses that have implemented RFID have only done so to satisfy customer compliance demands. That is, these businesss have not rolled out their RFID programs to enhance warehouse and logistics operations. Wal-Mart is one of the consumer products outlets that have previously trial to roll out a RFID program to avoid the hustling resulting from queues and other disadvantages of the Universal Product Code. This paper explores the reasons that hinder RFID deployment in Wal-Mart and the differences between the firm’s attempts to deploy the program. Wal-Mart-Case Study Wal-Mart is among the first retail outlets to try implementing RFID on its consumer goods as early as 2003. However, the plan to implement the ambitious RFID plan targeting the firm’s clothing goods would later be rolled out in 2005. First to be tagged with the Electronic Product Code (EPC) in the form of RFID in 2003 were the firm’s 3 Wal-Mart distribution centers in Texas1. Unfortunately, these plans rapidly fizzled, forcing Wal-Mart to look to other suppliers for the right value proposition. On realizing that they were absorbing the extra tagging costs, the suppliers of WalMart’s RFID tagging pushed back. Since the RFID tagging initiative by the firm seemed lacking and faced myriad challenges, it shifted its focus on other priorities such as sustainability and changes in the management of its inventory. Later, the firm would start a small scale RFID tagging at its Sam’s Club warehouse club chain where it started by tagging only at the pallet level and charged back the suppliers who did not RFID-compliance. Unfortunately, this program also flopped in early 2009. The failure of this program frustrated not only Wal-Mart but also other top level consumer goods outlets such as Procter & Gamble and Kimberly-Clark as the end-to-end supply chain visibility benefits offered by using RFID were stopped. Similarly affected were the manufacturers of RFID Tags and software firms that had rather high expectations of the Wal-Mart rollout program. Current RFID Tagging Programme There seems to be another gold-rush opportunity for these supply chain stakeholders affected by the stalling of the earlier rollout plans by ...Download file to see next pages Read More
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