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A research report has revealed the innovative new ways that retailers are using RFID technology in-store, in order to improve profitability.

Authored by Emeritus Professor, Adrian Beck from the University of Leicester and the ECR Retail Loss Group and supported by Checkpoint Systems, ‘Utilising RFID in Retailing: Insights on Innovation’ research report highlights how companies are employing the technology for a broader range of purposes.

Benefits of RFID in retail

The research report demonstrates the value that technology is bringing to their businesses and ultimately, the impact it is delivering to their bottom line. Crucially, it also shows that more retailers now more than ever are recognizing the benefits of RFID and driving uptake within their organizations.

The report claims that as businesses are becoming more established in their use of RFID-generated data, they are gradually incorporating more use cases into their business-as-usual practices.

Rising use of RFID technology

It also found that using RFID technology was having a significant impact on store processes

In particular, more and more retailers reported using RFID to streamline the audit process (as an alternative to infrequent organizational stock takes), which not only delivers considerable cost savings, but also provides more regular insights into the status of inventories.

It also found that using RFID technology was having a significant impact on store processes. While RFID has always been the key to inventory accuracy, some companies are now using this data to further improve business activities, such as reducing phantom out of stocks, improving rapid stock search and find tasks and developing an efficient ship from store (SFS) capability.

Delivering omni-channel retailing

Beyond the more traditional retail model, RFID was seen as a key facilitator in delivering omni-channel retailing, by all those questioned. Without the inventory accuracy offered by RFID, few retailers believed that they could reliably use their stores as fulfillment centers to output online orders.

Indeed, one retailer admitted to only making RFID-enabled store stock available for this purpose. The use of RFID to improve online order accuracy is also becoming more common place, to reduce errors in the picking and packing process, and therefore, improving customer satisfaction. One retailer reported a 90% reduction in incorrect orders and customer complaints, since introducing RFID into the process.

Tested in self-checkouts (SCO)

Looking to the future, one area where the benefits of RFID are starting to be tested is self-checkouts (SCO). While currently limited due to the need to have a 100% SKU tagging strategy in place, retailers are starting to recognize the benefits that the technology could offer, including increased speed of checkout, reduced likelihood of double scanning and thereby, improved customer service.

Another area where retailers also reported reaping the benefits of RFID was loss prevention. While none of those interviewed argued that reducing loss was the primary reason for investing in RFID technology, many acknowledged that they were benefiting from it, by using the technology to tackle refund frauds, enable dynamic loss product profiling, manage e-frauds and identify stolen products.

Inventory accuracy and provision of valuable data

RFID technologies can deliver clear-cut benefits in terms of inventory accuracy and the provision of valuable data"

Commenting on the report, report author Adrian Beck stated, “Previous research has shown that in the appropriate retail context, RFID technologies can deliver clear-cut benefits in terms of inventory accuracy and the provision of valuable data.

Adrian adds, “In this study, we wanted to find out how its use evolved over time, understand what innovation looks like, as well as delve into the benefits and limitations of the technology. While some retailers are certainly pushing the boundaries, when it comes to RFID usage, others have adopted a much more incremental and gradual approach to its application.

RFID key to deploying omni-channel strategy success

Mariano Tudela, Vice President of Europe Sales, from Checkpoint Systems, said “It is great to hear that companies are looking beyond the traditional benefits of RFID, to find new and innovative ways to use the technology and it will be very interesting to see how this develops over the coming years. One of the key evolutions for RFID recently has been in omni-channel retailing, and particularly following the COVID-19 pandemic, it is an area that we expect to see taking off in the future.

Mariano adds, “RFID technology is the only way to ensure a successful omni-channel strategy, and retailers that don’t adapt their offering are likely to be left behind. With decades of expertise, Checkpoint Systems is market leader in RFID technology making it any business’ strategic partner of choice.

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