zebra logo

The Visible Value Blog

Seven Convincing Reasons to Implement RFID In Your Retail Stores

Posted by Susan Flake

May 18, 2016 at 4:36 PM


Attention all retailers: It’s time to take a second look at radio frequency identification (RFID) technology. RFID has experienced significant advances in the past decade – and particularly in recent years. Lower cost of ownership, improved reader form factors, greater global standardization, innovations in passive ultra-high frequency (UHF) tags are all furthering RFID interest and adoption.

But the most convincing case for RFID can be found in the proven return on investment (ROI) that item-level tagging provides in retail stores and throughout the entire supply chain process. If you haven’t taken a look at the benefits of RFID recently, consider these seven great reasons to implement RFID in your retail stores:

  • Improved Inventory Accuracy. Studies have shown RFID improves inventory accuracy up to 98-99.9 percent.
  • Reduced Inventory Management Labor. Apparel and footwear retailers report inventory labor reductions of 75 to 92 percent. In tests, only 200 items per hour were counted using a manual process, while 5,000 items per hour were counted using a handheld RFID process.
  • Fewer Out-of-Stocks. Out-of-stocks can be reduced by 60 to 80 percent with item-level RFID.
  • Faster Stock Flow from Stockroom to Sales Floor. Studies show that 25 to 40 percent of retail out-of-stock merchandise was in the stockroom or fitting room and not replenished in a timely manner. RFID can help retailers reduce this percentage significantly.
  • Reduced Inventory Carrying Costs. Retailers are able to maintain leaner inventory levels and reduce the associated carrying costs from 30 to 59 percent.
  • Increased Sales. Item-level RFID has shown an increased sale of items per transaction by as much as 19 percent and an increase in the amount of transaction by as much as 6 percent.
  • Protection Against Counterfeiting. It’s estimated that counterfeit fashion apparel may cost designers more than $10 billion annually. By using RFID to support electronic article surveillance (EAS), retailers can reduce these losses significantly by tracking and authenticating products from cradle to grave.

Many of the benefits listed above apply to a retailer’s in-store operations, but in today’s omnichannel world, retailers understand that being able to allocate items and fulfill orders from inventory located in any part of the supply chain is more efficient, more cost-effective and more likely to result in faster fulfillment and an enhanced customer experience. And virtually all retailers agree that the key to accurate inventory management is technology, most notably RFID.

Behind the scenes throughout the omnichannel supply chain, RFID allows retailers to maximize inventory control and flexibility all the way from manufacturer orders through direct-to-customer shipping. Today’s RFID technology, especially item-level RFID, helps increase the productivity of the retail store as both a sales channel and a fulfillment center. It also helps enhance customer satisfaction, optimize fulfillment and, ultimately, improve end-to-end supply chain ROI.

That’s why 47 percent of goods received by retailers today arrive ready for item-level RFID tagging with EPC ultra high-frequency RFID tags already attached, according to a recent survey by the supply chain standards group GS1 US.[i] At Zebra, we expect the adoption of this powerful technology to continue to grow. 

For more information on the benefits of item-level RFID tagging in the supply chain, visit: www.zebra.com/rfid


[i] http://www.rfidjournal.com/articles/view?12837

Topics: RFID, Retail, North America