Currently, the retail sector is experiencing notable growth driven by increased consumer spending and technological advancements and this growth has been supported by an expanding global economy.

Omnichannel strategies and the need to adapt to the demands of a more digital clientele have led companies to modernize their sales and customer service methods. E-commerce, along with the appearance of new technologies such as Big Data or RFID technology, is shaping a landscape where innovation and customer experience will be key to future retail success.

RFID In-Store Tagging

RFID In-Store Tagging refers to the process of attaching RFID tags to products at the retail store level. This means the products arrive at the store without RFID tags, and store employees apply the tags before the products are placed on shelves or made available for sale.

How the process is?:

  • Receiving Products: Products are delivered to the store without RFID tags.
  • Tagging: Store employees attach RFID tags to each item. This can be done manually or using automated tagging machines.
  • Activation and Encoding: The RFID tags are activated and encoded with specific information such as product details, price, and stock-keeping unit (SKU).
  • Placement: Tagged products are then placed on shelves for sale

The main advantages of RFID In-Store tagging:

  • Flexibility in Managing Stock : allows retailers to decide which products to tag based on current store needs, promotions or inventory strategies
  • Better Control Over Tagging: Ensures that the tags are placed correctly according to the store's layout and security needs.

Which are the challenges of in-store tagging:

  • Time-Consuming and Labor-Intensive: Requires significant employee effort, which can lead to higher labor costs.
  • Potential for Human Error: Incorrect tagging can lead to inventory discrepancies and reduced protection against theft.
  • Additional Cost and Effort for Store Staff: The manual tagging process can be inefficient and costly over time.

RFID Source Tagging

RFID Source Tagging involves attaching RFID tags to products at the point of manufacture. This means that products are tagged before they enter the supply chain, allowing for seamless tracking and management from the factory to the retail store.

How the source tagging process is:

  • Manufacturing: Products are manufactured, and RFID tags are integrated into or attached to the products at the manufacturing site.
  • Encoding: Tags are encoded with product information, including SKU, batch number, and other relevant data.
  • Distribution: Tagged products are shipped through the supply chain, with RFID systems tracking their movement and status.
  • Retail: When products arrive at the retail store, they are already tagged and ready for sale, simplifying the receiving and stocking process.

Main advantages of source tagging:

  • Streamlined Supply Chain with Consistent Tagging: Ensures uniformity and reliability in tagging, reducing the risk of errors.
  • Cost savings: Minimizes the need for in-store tagging, freeing up staff for other tasks.
  • Improved Inventory Accuracy and Visibility: Provides precise tracking from production to point of sale, enhancing inventory management.

Key Differences Between In-Store Tagging and Source Tagging

  • Timing and Location of Tagging:

In-Store Tagging: Tags are applied once products arrive at the store. In-store tagging takes longer as it is done by the employees, it is manual work

Source Tagging: Tags are applied at the manufacturer or distributor. Source tagging is faster since it is done in the factories, it does not require manual work in the store.

  • Cost Considerations:

In-Store Tagging: Higher ongoing costs due to labor and equipment required for manual tagging.

Source Tagging: Higher initial investment, but lower long-term costs due to reduced labor expenses.

  • Inventory Management:

In-Store Tagging: Can be prone to errors, leading to potential inventory discrepancies.

Source Tagging: Enhances accuracy and efficiency, improving overall inventory management.

  • Customisation and Flexibility:

In-Store Tagging: Allows for store-specific promotions and adjustments.

Source Tagging: Standardises the tagging process, which might limit customisation but ensures consistency.

  • Logistics and Supply Chain Impact:

In-Store Tagging: Limited impact on the broader supply chain, focused mainly on in-store processes.

Source Tagging: Influences the entire supply chain, providing benefits such as real-time tracking and better coordination between production and retail.

A Technology for Every Situation

The reality is that after seeing the benefits of each method, we ask ourselves, which one should we choose? Therefore, we highlight some points where source tagging might be the best option:

  • If you are looking for a faster way to perform inventory checks: Source tagging may be the best option as it allows products to arrive at the store already labeled, streamlining the counting process and reducing the time required for inventory audits.
  • If you want to use RFID as EAS: Source tagging provides more effective protection from the origin, reducing the need for additional security measures in the store.
  • If you need a solution to provide more accurate data at the point of sale: Source labeling facilitates a more efficient and accurate checkout experience, which can enhance customer satisfaction and operational efficiency.

In conclusion, understanding the differences between RFID in retail store labeling and source RFID labeling will enable you to make informed decisions that optimize inventory accuracy, improve customer experience, and maximize the ROI of your RFID implementation. By choosing the method that best suits your specific needs, you can achieve greater operational excellence and provide a superior shopping experience for your customers.