Supply Chain Electronic Product Code

( EPC) Kickoff Meeting

EPC Overview 05/22/10 1

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Overview

What is EPC?


• Radio Frequency tagging at the package

level
• UPC code plus a unique serial number
• RFID chip between paper stock label.
•


• In order to activate the EPC device it is

“encoded”


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Scope of Project

Product in Wal-Mart Department 23



 Men’s Underwear
 Men’s Socks

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Wal-Mart is committed to EPC technology

Wal-Mart is focusing on a variety of applications for which EPC can make a



positive business impact, generally grouped into five categories:



 Improved inventory management

 Inventory visibility
 Operational improvements
 Reduce inventory shrink
 Asset tracking

Walmart’s planned improvements and benefits of using EPC are:

 Improving in-stocks and product availability

 Improving store and club inventory accuracy
 Promotion execution
 Associate productivity
 Electronic proof of delivery (EPOD)


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 Complexity Overview

Underwear Socks TOTAL Comments

SKU Count 180 22 202 These are Hanes SKUS shipped to Walmart ,
most of which are “ shared ” by other HbI
retail partners

Annual 44 . 5 MM 11 . 7 MM 56 . 2 MM Hanes Underwear and Socks packages

shipped to D23 on an annualized basis
Packages
( WMT
Only )
Countries of 10 4 10 These are the different countries where
we sew product , they include self - owned
Origin facilities , contractors , and turn key
( Sewing ) sourced vendors
Total 25 6 31 Self owned sewing facilities , contractors ,
turn key sourced vendors and distribution
Locations centers

Annual Turns 2 . 6 2.4 Avg 2 . 5

Team Structure

• Executive Sponsor
• Steering Committee
• Cross Functional Team
• Sub-teams
 Underwear
 Socks
 Manufacturing
 Process and Quality
 Benefits to HbI
 Legal Policy
 Financial
•


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Project Highlights

• Wal-Mart will pay VAS up charge of $.15

• Labels Cost $.107
• Label must identify that it is EPC
• New Printers run 50% slower to encode EPC
information
• Will order from Service Bureau until printers are
installed (No cost increase versus printing in-house)
• Testing various ways to label Underwear until printing
in house (6 Options identified Manufacturing sub
team will make recommendation)
• Will convert Style by Style
• Run a “pilot” to work out process flow and determine
any issues

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Men’s Socks

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Men’s Underwear

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Key Timeline Points

• Select “pilot” style for Underwear and Socks, 372P5, 184/6

-complete
• Order labels for Pilot from Service Bureau April 30
• Begin Tagging inventory in manufacturing May 31
• Ship Northbound to USA June 14
• DC to segregate inventory and reach TIL level July 30
• Turn VAS on and ship to Wal-Mart Aug 13
•

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Next Steps

• Determine Pilot timeline

• Establish Execution Plan for both Socks and
Underwear
• Manufacturing Process Requirements(will need
to determine printing capacity space, new
processes to control stickers…)

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