Major retailer RFID tag mandates have forced manufacturers to be proactive in exploring RFID solutions — either at their own facilities or through the efforts of a third-party logistics (3PL) partner. If your goods ultimately end up on a retailer’s shelf, you’re now facing new responsibilities to implement an RFID printing and encoding solution.
In early 2022, Walmart issued a mandate requiring its suppliers in some departments to include RFID tags on all products provided to the store — with compliance expected to be met on all goods arriving in stores by September 2, 2022. The mandate covers a wide range of products in multiple departments including home goods, sporting goods, toys, electronics, and automotive batteries. All US locations, including those in Alaska, Hawaii, and Puerto Rico, and .com purchases are affected. The recent mandate comes on the heels of a 2020 project for Walmart, where RFID technology was used to track apparel goods as they were received, displayed, and sold.
Walmart is far from alone in this endeavor. In recent years other retail companies — such as Target and Macy’s — have implemented RFID to improve inventory accuracy. Following Walmart’s announcement in January, fashion retailer Nordstrom unveiled a similar mandate; RFID tags are now required for most of their merchandise, including apparel, accessories, baby gear, shoes, and home products.
Why We’re Seeing Retailer RFID Tag Mandates Now
Retail-wide adoption of RFID seems more likely than ever with many behemoths in the space jumping on board. But why now? Walmart, for example, first began planning to roll out RFID stipulations more than two decades ago.
But retailer RFID tag mandates are picking up momentum because of the maturation of the technology. RFID solutions give retailers better control over their inventory and ensure product availability enabling suppliers to respond to demand faster and more efficiently. Those benefits, which can be applied to manufacturers as well once their own RFID systems are set up, include:
Better insight into inventory availability
Real-time inventory tracking
Faster fulfillment processing times
More accurate real-time data analytics
Walmart cited such benefits from its 2020 initiative as a reason to increase the scope of RFID tagging now. The adoption paid dividends for the massive retailer in the form of improved customer satisfaction stemming from improved on-hand inventory accuracy and fewer next-in-line (NIL) picks.
Realizing the benefits of on-time replenishment and proper stock levels that employing RFID solutions create are now also within reach for more organizations. A 2021 report from McKinsey found that the average price of a RFID tag has dropped by nearly 80% in the last decade and the price of RFID readers has been cut in half. It’s clear that RFID tagging should be the expectation for manufacturers, and not the exception, moving forward.
RFID within reach, with Zebra: Learn how Zebra’s off-the-shelf RFID solutions are proving on point for SMBs.
How You Can Reach Compliance with Retailer RFID Tag Mandates
While retailer mandates may have been surprising, or at least forced an acceleration of previous RFID tagging plans, they do offer an opportunity for manufacturers to achieve the same kind of benefits that retailers enjoy. With an operational RFID track and trace solution, you’ll be able to create efficiency in your inventory management and fulfillment workflow and improve the speed and accuracy of your inventory counts.
Adopting RFID tagging within your facilities — or with third-party assistance — allows you eliminate the risk of noncompliance with retailer mandates and cut back on the risk of waste, while enhancing your competitive position for the long term.
Two Approaches to Implementation
Unless you’re already tagging your inventory at the point of manufacture today, you’re going to adjust your process and make some additions to adhere to retail RFID tag mandates. Broadly speaking, there’s two approaches to this:
Implement RFID at the source — This is viewed as the preferred method and will form the basis for long-term planning for most manufacturers. However, with the quick proliferation of such mandates, many manufacturers may not have established how to take this approach.
Work with a distributor to tag downstream — In short term, particularly if you have inventory in transit or residing in a distribution center, this may be a temporary and more rapidly achieved approach.
If you’re a 3PL or distribution partner, you’re likely already fielding requests to implement RFID tagging. In this case, it makes sense to make RFID implementation a regular part of the inbound or outbound process. No matter where RFID tagging takes place, there are multiple ways to manage the process.
Print RFID Labels Yourself
Setting up your own printing capabilities will require some upfront work, whether you need large-run batches or individual labels. You’ll need to acquire the right equipment as specific RFID printers, labels and inlays are all critical to the process. There will be training necessary for your employees to correctly print RFID tags, and make adjustments if a single hub will be used to print and encode different types of tags. You’ll also need handheld or fixed RFID readers to test and validate your process in your own facilities.
You’ll also likely need to get your RFID solution configured correctly, with inlays tested and certified. For example, the Walmart RFID mandate dictates that all incoming tags and labels need to be certified by the ARC Program at the RFID Lab at Auburn University. Other retailers will have their own validation requirements.
Outsource Preprinted, Pre-Coded RFID Tags
A trusted third-party RFID supplier can work with you to supply preprinted tagging materials that meet retailer specifics. This solution will be quicker to implement, particularly those trying to comply with recently announced requirements. With outscored RFID tags and labels, completing the process rests simply on placing an RFID label in the proper location on the package per the specific retailer requirements. Securing pre-printed labels and tags, along with placement details, is particularly important for 3PLs to tag existing inventory already within their footprint.
Account for Every Detail with Zebra: Selecting the right RFID labels and inlays is critical to secure the optimal return on your RFID investment. Learn more here.
Meet Retailer RFID Tag Mandates with Confidence Through Zebra
The time to act is now to plot out both short-term and long-term compliance strategies to meet new RFID requirements from retailers. Zebra has the capability to manage either approach and works with you to decipher a solution that is viable from every angle, from cost to timing and the resources needed.
We can help you figure out which printers, inlays and labels you need based on the specifications provided by each retailer. For example, Walmart spells out its standards and spec requirements in a designated playbook. Zebra also takes you through the process of determining the type of tag (and printer) you’ll need, depending on the type of merchandise you’re tagging. Zebra, and our partner network, help account for every component of your RFID solution.
Gartner, Inc. just named Zebra a Leader in the Magic Quadrant for Indoor Location Services for the third consecutive year, and our team has helped many retailers, manufacturers and warehouse operators successfully implement RFID solutions.
Schedule time with a Zebra representative to find out how we can help you, too.