![]() Retailers like Victoria’s Secret have recently said they are also testing RFID tags to prevent shoplifting. Then there’s the rise of organized retail theft, which according to the National Retail Federation, cost businesses an average of $700,000 per $1 billion in sales. Prior to RFID, Macy’s inventory count was not accurate enough to make sure that every unit was in-stock, experts said. ![]() The program, through the use of RFID, allows Macy’s to list a product up for sale even though there is only one item left. Macy’s, which decided to have all of its items RFID-tagged by 2017, has a program dubbed Pick to the Last Unit (P2LU). ![]() Zara has been using the technology to track products across various countries and replenish clothing racks faster.ĭ’onofrio said RFID can help retailers lift their revenue because by having a more accurate count of inventory, it allows them to sell their products down to the very last item. Nordstrom said it wants to implement RFID to anticipate and address its customer’s expectations. Now, Walmart is ready to give RFID another go, and with this, experts expect industry-wide adoption to continue. Before using the technology, it took multiple store employees hours to do the same work. When Outdoor Voices began using RFID in 2018, the company said at the time that it took a worker less than an hour to complete a full inventory count. “With RFID you can much more quickly and know exactly what things are selling,” he said. He added that barcodes were a much cheaper solution earlier on, but it was time-consuming as workers needed to properly angle scanners and count thousands of items. “It takes a while for some of these technologies to actually evolve to where we’re at, and the challenge that RFID has, in some ways, was competing with a barcode,” D’onofrio said. But eventually, the initiative fizzled out for a variety of reasons, partly because the tech was still in its infancy stage and there wasn’t any broad industry standard for adoption. Walmart in the early 2000s initially pushed its suppliers and vendors to use the technology. Its roots can be traced back to World War II as military use technology, Tony D’onofrio, CEO of consulting firm Prosegur Global Retail said. RFID scanners, on the other hand, can scan several tags at once and can read tags at a greater distance than barcodes.īut RFID was ahead of its time. Before RFID, store workers used to manually count items or use a barcode, Alverson said. Recent research from McKinsey indicates that RFID improves inventory accuracy by over 25%. “RFID technology and the solutions around that are going to be, and are, a huge part of how they’re going to solve those challenges today.” Why is RFID getting a second look? Online shopping behaviors and the supply chain crisis played a huge role in making it more urgent for retailers to improve visibility on supply and demand, she added. “What’s occurring now is relative to what we’ve gone through the last two years with our health crisis, which began to change operations for retailers,” Nell Alverson, senior director of channel marketing at ScanSource said. A report from McKinsey in May said that the average cost of an RFID tag has dropped 80% over the last decade to around four cents, which experts say has boosted adoption rates. The rise of omnichannel shopping growing alongside retail thefts have made the use of RFID increasingly important. Meanwhile, Macy’s has increasingly been utilizing the technology as high-profile thefts hit retailers across the U.S. Nordstrom also issued a similar mandate to suppliers just a few weeks ago. Walmart in January said its suppliers in some departments are required to include RFID tags on all merchandise by September this year - not the first time it has attempted such an initiative. Though the technology has been around for decades, retailers have increasingly embraced RFID as it has become more cost-effective.
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