Daisy Brands, which sells its sour cream and cottage cheese through retail stores worldwide, joined Wal-Mart's RFID mandate early on to avoid the rush of companies clamoring for help with RFID products, certification and services.

It's been more of a three-year-long walk than a rush, though. Many suppliers are taking their sweet time to tag pallets and cases of products headed for Wal-Mart distribution centers and stores. Wal-Mart hasn't punished suppliers who've chosen not to comply, but that could be changing: Wal-Mart-owned Sam's Club reportedly is asking suppliers to tag pallets with RFID 2 tags or face a fine of $2 per pallet beginning Feb. 1.

While others have hesitated, Daisy says its investment in RFID has been a boon, helping Daisy better manage the flow of its perishable products through Wal-Mart stores and ensure marketing promotions proceed as planned, according to Kevin Brown, Daisy's information systems manager. It also lets Daisy's other customers -- including those who don't use RFID -- better track their orders.

RFID reader and tag company Alien Technology, which considers Daisy a marquee customer in retail, will announce Monday that Daisy is continuing its investment in Alien's technology by upgrading to its ALR9900 readers, which offer improved antenna technology for better read rates. Daisy hasn't done a hard cost analysis on the payback of RFID, but the benefits are moving beyond Wal-Mart compliance, Brown told InformationWeek.

"It was never really an ROI project for us," he said. "It's all about being a good partner." That includes not just working more closely with Wal-Mart, but improving tracking services for its other customers.

"It's just like going to FedEx to track a package," Brown said. "Our customers can log on to our portal and see what was picked up and by whom." Brown adds that Daisy is beginning to work more closely with Sam's Club on that retailer's RFID ramp-up efforts.

Wal-Mart officials have insisted they're making good progress with RFID, particularly with in-store applications such as faster replenishment of out-of-stock merchandise. But the retailer has scaled back plans to use RFID in its distribution centers in the past year or so, primarily because a vast majority of Wal-Mart's 20,000 suppliers sending products to those centers haven't adopted the technology. The cost of RFID tags, which might run $1 apiece compared with a few cents for a bar code, and read problems with some materials, such as liquids, glass, and metals, has slowed the adoption of RFID in retail.

But the rate of Wal-Mart compliance isn't a big deal for Brown, who hopes to keep improving his business with RFID and get his raw material providers on board with the technology, too. Daisy, like California tomato canning company Pacific Coast Producers, insists that RFID is proving worth its while.

In 2003, Wal-Mart announced 100 top suppliers would launch its initial RFID effort. Daisy was among another 30-some companies that also volunteered. "We wanted a relationship with the appropriate partners and providers to get this done," Brown said. "Quite frankly, I didn't want to be in line."

But there were other reasons it made sense for Daisy. It's based in Dallas, Texas, near Wal-Mart's own distribution centers. It makes perishable products that live by a relatively short expiration date and must move quickly through the supply chain. By the fall of 2004, the company had started shipping RFID tagged cases and pallets to Wal-Mart. Now, every one of its cases to Wal-Mart is tagged, and all of its pallets (which carry 70 to 180 cases) are tagged, no matter where they're heading.