Distribution is the hot bed for new RFID applications right now. Across the supply chain in multiple retail categories, major companies are hustling to meet looming deadlines, but even the government is getting into the act.

High-profile retailer Wal-Mart's top 137 vendors are in the final 100 days to meet a January 2005 deadline. Similarly, new Department of Defense contracts being issued now require RFID tags on pallets, cartons, and some packaging materials, also for deliveries beginning January 1, 2005, although no doubt timetables will be negotiated in the contracts.

Other retailers have been quick to seek advantage from Wal-Mart's initiative and major consumer goods companies are hustling to meet looming deadlines imposed by their customers. Because Wal-Mart reaches into every major retail category, it is becoming both competitively necessary and somewhat easier for other retailers to issue their own mandates.

Dallas, Texas is the epicenter of American RFID distribution implementation. That's where Wal-Mart's rollout of RFID is starting with a few DCs and stores. Consumer goods companies Gillette, Kimberly-Clark, Kraft Foods, Procter & Gamble, Nestle's Purina PetCare and Unilever among others are working there now to meet the looming deadline.

Wal-Mart declared in mid-May the initial test at its Sanger, Texas facility of electronic product codes (EPC) a success. The test involved different types of tags and tag placements on pallets of 21 products from eight suppliers. Products were shipped to Wal-Mart's DC, and then, with RFID tags attached, to seven local Wal-Mart Supercenters.

The retailer has said it plans to roll out to three to six DCs by August 2005, and hopes to have six DCs RFID-capable by year's end. Further, the company intends to add 250 suppliers and 100 stores by June 2005, and 350 more stores by October of 2006. Wal-Mart wants all 22,000 suppliers RFID-compliant by the end of 2006.

Target expects its top vendors to ship tagged pallets and cases beginning late spring 2005, and all vendors to do so by spring 2007. Food and drug retailer Albertsons announced in March an initiative to use electronic tags for tracking goods. Other companies that have made similar announcements include Best Buy, Ace Hardware, Home Depot and Lowe's.

In Europe, Ahold, Marks & Spencer, Metro, Carrefour, Tesco and Sainsbury are in pilots. From all indications, Metro is the leader of this pack. It has set November as the month when 20 consumer products suppliers will begin to place RFID tags on pallets of goods. Another 80 suppliers are scheduled to follow in 2005. By January 2006, the company says it will have 300 suppliers using RFID.