RFID growth in retail has continued to accelerate in 2023 with a projected 24 billion labels to be used in apparel retail , 30% of the overall market potential (Chang, 2023). This tag growth has been driven by major brands investing in RFID such as Nike, Adidas, Deckers Brands, as well as mandates from leading retailers like Walmart, Target, Nordstrom, and Macy’s, driving RFID adoption across thousands of brands globally. This opens tremendous opportunity for the multi-brand retailers out there who have large portions of their stores’ inventory coming in tagged with RFID. With little investment, these retailers can scan their stores and drive profitability across their enterprises. A leading study from the ECR Group (Beck, 2021), shows that leading retailers who have used RFID to manage their inventory have shown increases in sales as high as 5.5% or above, along with significant cost reductions due to improved stock management. With today’s E-Commerce growth, many of Checkpoint’s customers are leveraging RFID to improve their in-store pick rates, driving successful BOPIS and Ship from Store programs.
To get started, most retailers can leverage the existing mobile device they use in their stores for various applications, and simply add a RFID handheld or sled. Most retailers achieve ROI by scanning their inventory once or twice a week, often in minutes and up to 30X faster than scanning by barcode. The other piece of the solution is a scalable software platform that can be easily deployed to a fleet of stores. Leading retailers are leveraging Checkpoint’s Cloud-based ItemOptix™ SaaS platform, which is easy to use, easy to deploy and easy to adapt. With as little as a product master and daily stock on hand file, retailers can scan their stores, and integrate that RFID data back into their ERP with industry standard REST API’s allowing a simple integration. Checkpoint has also worked with software integrators such as Makira who have helped deliver the necessary integrations between a retailer’s ERP and Checkpoint’s ItemOptix ™ software.
What Checkpoint typically sees, is that the majority of the ROI with RFID is achieved through simple counting. By improving SKU Level inventory accuracy from an average of 65%-75% to upwards of 98%, retailers have consistently shown this increased profitability. What makes RFID so great, yet sometimes very tricky, is that it can do so much more. RFID use cases beyond inventory include applications such as fixed reading solutions, replenishment, receiving, and more advanced functionality such as using RFID for Loss Prevention and/or Point of Sale. However, the best course of action is to first focus on improving baseline inventory accuracy, and use that ROI to fund other investments in your program. When that approach is taken, retailers and brands have shown they can continue to invest in RFID, driving improved shopping experiences for their customers and resulting in increased company profitability.
Where retailers can further gain from RFID is in driving ERP performance. RFID is an enabler of more accurate and frequent inventory updates to your ERP. What does that mean for your organization as a retailer? Rick Boretsky, Co-Founder and Managing Director of Makira (a leading technology and services company for specialty retailers) adds:
“Makira has recently developed a standard connector between ItemOptix™ and a leading Retail ERP for a national shoe retailer. Using ItemOptix™ APIs, the connector has enabled inventory count updates in real-time. The results were quick and significant. With more accurate store level inventory, it has enabled the retailer to make better allocation, replenishment and pricing decisions.“
RFID has proven in recent years to be a vital technology to fast-paced, successful retailers and brands. In today’s world, it’s more important than ever to have inventory visibility through all sales channels, maximizing each touch point of your product, whether it’s viewed online or in store. Whatever type of retail business you are in, RFID has a strong ROI and is easier than ever to implement. Inventory accuracy, driven through RFID, is foundational to every store process and will be critical to retailers’ success in the future.