RFID technology is not new, far from it. It grew out of World War II radar technology, used by the British, American, and German militaries to identify whether planes were friendly or foe.
Today, RFID is helping retail companies shape omnichannel supply chain strategies. Here, Lindsey Mazzaglobal retail leader, capgeminianswers some questions about the resurgence of RFID as a key technology in the post-pandemic retail world.
Why has RFID become so important to retail?
The way RFID is used has changed, but it has always been important. The first patent for commercial RFID tags was granted in 1973. Since then, the technology has been used in manufacturing, logistics, and delivery networks, where product tracking and location control are critical, as well as in a wide range of sectors, including consumer products, automotive. , electronics, agriculture and retail.
How has the pandemic impacted the adoption of RFID?
COVID-19 forced companies to quickly adjust their priorities to meet new customer preferences, particularly the shift from in-store shopping to online shopping, and the omnichannel retail model that has emerged from this.
Can RFID make shopping in the store like being online?
The new retail experience is channelless; commerce is everywhere and consumers expect it everywhere. A reduction in the cost of sensors and improvements in both range and readability make RFID a renewed option to help retailers create data-driven omnichannel experiences for consumers.
The lower costs of RFID tagging also make it an option for improving inventory accuracy across a fuller range of products, including fast-moving consumer goods.
Can RFID be used to check product availability in stores?
In the new phygital (physical and digital) world of retail, with fast commerce as the engine of revenue growth, inventory accuracy has become paramount.
Knowing what is available to promise, in what quantity, at a specific moment in time, is key to winning consumer purchases and delivering on promises to today’s consumer based on convenience.
RFID is a way to increase inventory accuracy to meet consumer expectations for ROPIS (Reserve Online, Pick Up In Store), BOPIS (Buy Online, Return In Store), Curbside Pickup, as well as delivery options. Knowing exactly where inventory exists allows retailers to meet consumer demand.
Is RFID helping to turn stores into logistics centers?
Yes. It is helping organizations save on logistics costs by facilitating fewer deliveries and requiring fewer distribution centers.
What impact does RFID have on retail forecasting?
Today, demand must be met in moments, not days. Hyper-local fulfillment centers, dark stores, and even automated back rooms are supporting consumer demand for fast commerce.
RFID is great for tracking and tracing products, but it also supports demand forecasting, allowing planners to combine large amounts of accurate inventory data (warehouse, withdrawals, replenishments, consumption) as input for multi-level forecasting.
With RFID, planners can gain a better view of demand for out-of-stock items, understand product transit times to reach outlets, gain insight into weeks of supply across sales channels, and assess future resupply needs.
How else can RFID improve the retail experience?
RFID can not only improve inventory visibility and accuracy, but also empower contactless payment capabilities, supporting consumers’ demand for security during purchases.