New York — Wal-Mart Stores Inc. has started using radio frequency identification, or RFID, tags to automatically track merchandise in its Dallas area stores, testing the technology in anticipation of a larger rollout in January.
Wal-Mart, the world’s largest retailer, installed RFID readers at its distribution center in Sanger, Tex., as well as seven additional stores in the area. Eight manufacturers, including Unilever and Procter & Gamble, are delivering 21 products with RFID tags, including cat food, toothpaste, and peanuts.
Privacy advocates say RFID tags in retail products could potentially be misused by police and others to identify and monitor individuals and their purchases without their knowledge. The devices have practical limitations, however. They contain only product information and cannot be easily read from more than 10 feet away
“We can certainly understand and appreciate consumer concern about privacy,” Linda Dillman, Wal-Mart’s chief information officer, said in a press release announcing the test. “That is why we want our customers to know that RFID tags will not contain nor collect any additional data about consumers. In fact, in the foreseeable future, there won’t even be any RFID readers on our stores’ main floors.”
Wal-Mart is tracking products through its distribution center and into the store stockrooms, but not onto the selling floor. The retailer isn’t using the technology to monitor customer purchases, and it’s unlikely that many customers will go home with RFID tags in their shopping bags. Wal-Mart’s RFID readers are installed at loading-dock doors, stockroom doors, and in back hallways. Only the cases that the products come in, as well as the palettes in which the cases are shipped, are tagged.
In most cases, the palettes and cases — along with the RFID tags — are discarded before the products reach the selling floor. Printers and scanners from Hewlett-Packard are the exception, because their product packaging also serves as the case.
Wal-Mart said the Hewlett-Packard items will be marked with an EPCglobal symbol. EPCglobal is the RFID standards organization. In addition, the retailer plans to post signs with the symbol at the appropriate shelf or aisle location. Customers may choose to keep or remove the RFID tags after purchase, Wal-Mart said.
The tests will help Wal-Mart learn more about how the equipment works, a company spokesman said. Once RFID is widely implemented at Wal-Mart stores, it will help to better manage inventory so the store doesn’t run out of merchandise, especially on the weekends, the company said.
— Cate T. Corcoran