Retail Leads the Pack in RFID Adoption
For many industries, the business value of RFID technology was first demonstrated in the supply chain. The capability to accurately see your inventory levels across your entire supply chain, has driven automated inventory decision-making, reduced costs and better customer service.
In fact, some industries have some evidence of mandating the use of RFID for verifiable tracking of assets, such as tracing the supply of pharmaceuticals, tracking luggage or compliance with FDA unique device identifiers for medical devices. In these industries, adoption is only happening where mandates are in place and/or only in small slices of the market.
Fortunately, due to high velocity and relatively high value of goods, the benefits that RFID delivers to the retail market allow the technology to pay for itself and then some. RFID in the supply chain is only the beginning. RFID delivers significant retail business value in the store and as part of the omnichannel experience. A growing percentage of apparel and footwear retailers and brand owners have fully embraced RFID technology for a variety of use cases; arguably, more than any other industry. And for good reason… Or rather, a lot of good reasons.
Retail was the first market to adopt barcode technology, which revolutionized inventory management and the point of sale (POS) transaction with greater speed and convenience. RFID technology logically follows as the next evolutionary step, without requiring line of sight to read RFID labels, delivering greater speed and functionality with familiar ease of use. Moreover, the ability to handle complex sku counts for retail product mixes makes RFID tailor-made for retail, particularly in the apparel market where products are sorted by category, style, color, size, etc.
The ability to handle complex datasets allows RFID to stand apart from less sophisticated technologies like barcodes. Customer service is a crucial differentiator in the competitive retail environment, and today’s consumers have become more discerning and demanding. The stakes could not be higher to prevent out-of-stocks and avoid missed sales opportunities. Item-level RFID for apparel inventory management, with the resultant 98% inventory accuracy, is fundamental to reducing stockouts and increasing sales, as well as speeding fulfillment of online orders and in-store pickups of omnichannel purchases. In fact, case studies have shown that RFID can achieve in-store inventory accuracy greater than 98 percent.
Likewise, the accurate and frequent inventory management capability of RFID offers measurable results in retail, enabling reduced inventory costs, more efficient and effective use of sales staff, and significant return on investment. Complete visibility into itemized inventory also opens-up a new world of data and analytics, helping retailers make sure they have what customer want now and better predict what the customer will want next month or next year.
When you consider the capability to increase sales, improve profit margins, reduce costs and improve competitive advantage, it’s not surprising that the retail market has embraced RFID in a very real way. The real question is why are other industries slow to fully adopt RFID?