While the technology goes through some considerable changes almost on a daily basis, some aspects of the technology never change - like the positive transitions it brings to the business or the manner in which it makes the work easier.

In order to endure the continuous competition, the retail apparel industry has to rely upon the technology. To deal with a perishable commodity like fashion, the retail apparel sector must ensure that it has the precise quantity of the products. If the retail store orders too much of a product, it can become stale and result in loss. In case of apparel retail stores, the position of the items is not fixed on shelf. The items constantly move between shelves and trial rooms. The odds are that even when an item is available with the retail house, it might not be on the shelf. This raises the likelihood of the stock never getting cleared, by creating a false out-of-stock situation and resulting in loss to the store. This explains the value of keeping an update of the inventory so that the right item is available for the customers when they demand it.


As per a report presented by the Harvard Business School, eight percent of all retail items are out-of-stock at any given time, costing the top 100 retailers approximately $ 69 billion in a year. The disadvantage that the items in the inventory are not visible, often results in up to 65 percent erroneous inventory counting. In return, this makes accurate ordering an arduous task. The very nature of high value merchandise that is openly accessible to customers increases the prospects for theft.


In such a scenario, RFID technology has come for the rescue of the apparel retail stores. RFID is an acronym for Radio-Frequency Identification, which functions as a tracking technology to discover and authenticate tags that are applied to products. General RFID is a tiny electronic device that consists of an antenna and a microchip, which is fitted with transceiver and transponder called as the RFID tag. The RFID tags are designed to receive and respond signals from the transceiver, allowing the tags to read from a distance.


The RFID device is similar to the bar code or the magnetic strip at the back of the debit or credit card that provides a unique identifier for that object. And, just as a bar code or magnetic strip must be scanned to get the information, the RFID device must be scanned to retrieve the identifying information. Providentially, RFID works better than the barcodes, as the RFID device does not need to be placed exactly on the scanner. This helps the store keepers in avoiding the trouble that they face when they find it difficult to read the barcode. As RFID device can work even when it is placed a few feet away from the scanner, so if a bag full of all the purchased items is placed on scanner, it queries all the RFID devices and totals the purchases immediately.

 

RFID technology has been around for more than five decades, but its implication in the retail apparel stores is comparatively novel. The reason behind delay in use of this technical advancement is lack of standards in the industry.


The benefits of RFID in retail apparel industry are umpteen. In terms of numbers, RFID application has reduced out-of-stocks by 50 percent, thus it has resulted in an increase in customer satisfaction and sales. In terms of volumes and profits, RFID has resulted in an average 15 to 20 percent reduction in restocking efforts and 90 percent reduction in labour associated with inventory counts.


The benefit of finding the right item when it is needed is the biggest advantage of the RFID technology. Industry experts believe that fashion retailers can grasp the immediate returns by moving straight to item level tagging with a customer-centric focus. RFID tags applied to individual item at the point of manufacture enable the mechanical tracking of each item from creation to purchase. Thus, the orders are easily tracked all the way through the supply chain. This also improves the order processing at the distribution level, facilitates identification of counterfeit goods inserted anywhere in the supply chain, and ensures finely detailed visibility of items in the retail store that the right item is available at the right time to increase sales and protect profitability.


RFID also significantly improves the time required to take inventory. When the records are kept manually, it not only requires a lot of time, but the chances of error increase by manifolds. An employee can easily take a complete inventory in minutes with the help of handheld RFID reader or a mobile RFID reader. This shrinks the chances of lost sales due to artificial out-of-stock situation, as the employees can know immediately how much quantity of a particular commodity is available.


As every single product in a particular shipment has a unique identifier, quality assurance and spotting any kind of product imitation are enhanced. It also improves exactness in picking and packing operations. With RFID, it is easy for the retailers to know how much stock they have of a particular product. When RFID was initially introduced, the fashion retailers realised that certain products that they were receiving were not ordered in reality. Like if a store orders fifty pieces of 32-size denim and it actually receives 30-size denim, in case of manual inventory, the staff assumes that it has received what was ordered without realising that it is over-stocked with 30-size denim and under-stocked with 32-size denim. It is difficult to employ people to confirm the receipts manually. Sometimes in such situation it is palpable for the stores to presume theft, as nobody knows the certainty behind the unavailability of the 32-size denim stock !

Earlier, when manual inventory was maintained, the total item counts were close to accurate, but minute details like the accuracy for design, sizes and colours were not actually close to reality. The manual inventory was maintained roughly. In a pile of clothes, the inventory control person would normally count only the top item, so if the size or colour was different below, an inconsistency in inventory would be created. Before RFID, apparel retail houses had 50 % inventory accuracy. Now with RFID most of the stores have achieved up to 99 % accuracy. The only reason that the accuracy isn't cent percent is due to some items being tagged incorrectly. 

 

The employee efficiency has also augmented, as today it requires approximately 45 minutes to file record of the available stock, as against to two hours prior to use of RFID. This technology also eases the security process, as the system is combined with the store's video surveillance system and automatically captures the exact time an item is moved.


With further improvement in the existing RFID technology, there are more benefits that the retail stores, as well as the customers can enjoy. There are RFID-enhanced display trays, which can tell the customers details about the complimentary items available with the selected merchandise. After the customer purchases the product and removes the price tag, the RFID is also removed.


RFID technology is a boon for the apparel retail industry, as it has brought a revolution by reducing the time taken for inventory and also by keeping a check on the problems concerning the inventory. The kind of flexibility RFID has provided to the retail business is enough to convince the apparel retail world that RFID technology is a must step in progressive direction.



References:


1.      Rfid.net

2.      Technovelgy.com



Image Courtesy:


1.      Blog.zebra.com

2.      Guokr.com

3.      Aimglobal.org