LITTLE ROCK (AP) -- Wal-Mart Stores Inc. promised state legislators Tuesday that any product with a radio tag would be clearly labeled, as the retail giant tries to put the inventory-tracking devices on all products sold at Sam's Clubs by 2010.

 

Wal-Mart, based in Bentonville, wants to place scanners reading the tags as they come off delivery trucks and head out to customers at the warehouse stores, said Simon Langford, director of retailer's electronic product code strategies. Langford said readers would even be placed by box crushers and trash compactors.

 

The tags, installed by manufacturers on every pallet and containers, would allow the world's largest retailer to quickly track back any defective or harmful product to its source, Langford said. The tracking also will help Wal-Mart cut down on theft, which an analyst suggested could have been as high as $3 billion last year. The company's overall revenues last year hit $378.8 billion.

 

''It's reduced out-of-stocks, increased sales for our suppliers and more importantly, lowered the cost of goods for our customers,'' Langford told the state Legislature's joint committee on advanced communications and information technology.

 

Langford said the technology, known as radio frequency identification tags, should be in place by 2010, something that's caused complaints among Wal-Mart's 60,000 suppliers. Some have criticized Wal-Mart for forcing them to adopt the technology without more information on impact on costs.

 

Others have raised concerns about privacy issues. Langford said the tags would only be able to be read from 10 to 15 feet away and only would contain numbers identifying the product. The company may experiment with tags that actively transmit information, but that would only be to track temperatures for produce and vegetables, Langford said.

 

After checkout, customers would have the option of removing the labels containing the tags. If a manufacturer installed the tag inside a container, workers would be able to deactivate it before a customer leaves the store, Langford said.

 

''Tags don't contain any customer information, it's simply a product number and a serial number,'' Langford said. ''We don't tie anything, nor will we, (to) any customer information as the product is sold.''

 

Sen. Jimmy Jeffress, D-Crossett, sponsored a bill last year making it illegal for the radio tags to gather or release any information related to ''the demographics of the purchaser'' after an item is removed from a store. Jeffress, whose bill was recommended for interim study, said Langford's explanation comforted him.

 

''I think a lot of my concerns have been alleviated and eased,'' he said.

 

Langford said the company continues to ask manufacturers to put the tags on containers and pallets heading to Wal-Mart stores, but has not set any deadline for suppliers.