E. & J. Gallo Winery offers an example of the first consideration, as this firm struggles with finding a sensible answer regarding deployment while faced with possibly conflicting needs. Gallo is pulled, on the one hand, by major retailers insisting on compliance and trying, on the other hand, to apply the RFID technology across its extensive distributor base. This California-based firm manages over 2,000 product SKUs in over 90 countries with 600 distributors/ wholesalers. Gallo has been hard at work forging a plan for using RFID technology in its supply chain with an eye on both constituencies.

Since Gallo is among the roughly 200 second-wave consumer products companies required to ship its products to Wal-Mart stores with RFID tags on cases and pallets by a January 2006 deadline, the mandate is a partial driver behind action. To comply, Gallo is making a sizable initial investment and has set up a test project at its Modesto warehouse, where the firm is piloting compliance. Through this effort, the firm will most likely enhance its understanding of exactly what it will encounter as it moves forward along its path to compliance.

From another aspect, Gallo has an eye on some traditional supply chain issues in its business environment. Because of the particular requirements in its business, the wine maker needs to include its U.S. distributors in any Auto-ID picture, because state laws generally require that wine and spirits be sold to retailers through in-state distributors. Without the involvement...