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CASE STUDY: APPLICATIONS OF RFID IN RETAIL BUSINESS
Feraidoon (Fred) Raafat
Department of Information and Decision Systems, San Diego State University
San Diego, CA 92182, USA
Hfred.rafaat@sdsu.edu
H,+1 619 594 5685
William R. Sherrard
Department of Information and Decision Systems, San Diego State University
San Diego, CA 92182, USA
Hwilliam.sherrard@sdsu.edu
H, +1 619 594 4304
Lilie Meslis, Jillene Windt
San Diego State University, San Diego, CA 9218, USA
ABSTRACT
The objective of this paper is to describe the basic aspects of RFID technology and to summarize
its implementation in two disparate retail businesses. The information on the two companies
(Prada and Wal-Mart) is drawn from several resources, including trade journals, white papers,
news articles and websites
Introduction
Among the earliest adopters of RFID (Radio Frequency Identification) in retailing are two
industry leaders that occupy opposite end of the marketing spectrum: Wal-Mart, the king of big
box retailing and Prada, a leading retailer in luxury apparel (Hines, 2003). These two retailers are
pioneering innovative technologies that are yet to be totally embraced by the industry or
consumers. Interestingly, Prada, who began individual RFID item tagging in its upscale New
York Epicenter store in December, 2001, never took full advantage of RFID tagging to track
goods within its store. Prada’s aim was not to eliminate inefficiencies in the supply chain but to
enhance the customer shopping experience. Whereas, Wal-Mart with its 90,000 SKUs (stock
keeping units) focused more on the efficiency of its total supply chain (Hines, 2003). In this
paper, the attributes, limitations and usefulness of RFID technology will be explored. This will
be followed by a discussion of the experiences of Wal-Mart and Prada in their implementation of
RFID.
What is RFID and why do we need it?
RFID or radio frequency identification refers to small electronic devices, i.e., a tiny chip,
attached to or embedded in th