The Crunch: Identifying and correcting inefficiencies, especially when it comes to inventory management, can do wonders to boost bottom lines. Inventory accuracy is integral to a merchant’s success. Through its innovative RFID (Radio-Frequency Identification) technologies, Checkpoint Systems is helping brands create perfect inventory visibility. Because they store data on the type, number, and location of inventory, the company’s RFID tags give retailers the ability to unlock 100% of their supply for customers. Though this is the foundation upon which the solution was built, Checkpoint Systems’ RFID technologies are multipurpose, aiding in the customer experience and loss prevention. RFID is changing how products move through the retail chain — from source to sale — and merchants large and small are quickly adopting Checkpoint Systems’ solutions.
Conversations about how RFID (Radio-Frequency Identification) will change the retail industry have increased rapidly over the last few years. First, there was the announcement of Amazon Go, the online giant’s new brick and mortar locations where there are no checkouts — customers just grab items and walk out. Then came news Delta Airlines, one of the first to adopt RFID tags for baggage tracking, was least likely to lose luggage compared to its major airline counterparts. Shortly before that, Bloomberg announced the number of RFID tags projected to sell in 2017 would total almost 8 billion, compared to 3 billion in 2014.
As monolithic as online retail has become, the fact remains in the U.S. $9 out of $10 is spent in-store. The greatest question for retailers now is how to use emerging technologies to better track physical products. As brands, from Macy’s and Walmart to high-end fashion retailers, adopt RFID as the foundation of their inventory systems, one provider stands front and center.
Checkpoint Systems, a global leader in merchandise visibility solutions for the retail industry, believes in a start-to-finish approach — what it calls “from source to shopper.”
“What’s unique to Checkpoint is we do everything from creating the tags, which are applied at source at the point of manufacturing, and deploying the technology, such as printers, readers, and high speed tunnels, that manage these along the way, to the software that enables the entire solution and integrates with customer’s existing systems, and hardware at POS to the point of exit where the customer leaves the store and we read that tag for the last time,” said Carl Rysdon, Checkpoint’s VP of Sales. “We’re the only company in the market that actually does the whole supply chain.”
It’s this dedicated attention to every detail, from onboarding a brand to tracking a customer’s preferences, that gives Checkpoint the ability to provide one of the most cost-effective inventory tracking systems on the market. Checkpoint’s RFID technology allows merchants to achieve high inventory accuracy, which is paramount to increasing sales.
However, the tool is multipurpose. RFID also gives retailers the ability to provide customer-friendly services like self-checkouts, warranty tracking, and even dressing room “magic mirrors.” This, added with robust loss prevention solutions, is why Checkpoint’s RFID is poised to lead the industry in inventory management.
Inventory Accuracy Lays the Foundation for the Greatest ROI
For decades, inventory systems have been riddled with inaccuracies. Consider the customer experience of walking into a store to buy an item, only to find an empty shelf. A nearby clerk can scan the barcode and say there “should be” some product left in the back, only to return unable to find it. It’s one of the most frustrating experiences for in-store shoppers, particularly if they’ve driven out of their way to find something they needed right then and there. And yet, it’s become an expected moment in the retail industry.
“The thing everyone has to realize is the foundational piece is inventory accuracy,” Carl said. “If I just focus on gaining that, then I can get the biggest part of ROI.”
When inventory numbers are accurate — and 100% available to customers — everything from the in-store experience to what potential customers see online becomes possible.
“Retailers have to hide a lot of inventory from the online shopper,” Carl said. “You have to have two or three or more of the same item in the store before you’re going to commit to allowing [the online shopper] to see it. So they puff the inventory.”
RFID gives the retailer the ability to offer its complete inventory to online or pick-up-in-store customers. Overhead goes down and margins increases because merchants don’t have to stock excess versions of a product to include it online, and they sell it quicker at higher prices. They can feature a product their website without the need to have multiple backups — the RFID technology establishes confidence that inventory counts are accurate.
“You can imagine what that does for you to be able to unlock the inventory and actually offer it to the online shopper, which is a growing segment of the market,” Carl said, “And think about what that does to your cost of goods. I can be more of a fast fashion retailer but also still have the benefits of being able to offer 100% of my inventory to every shopper. That’s really the key to making this work.”
RFID Technology Allows Retailers to Solve Multiple In-Store Issues
Carl noted RFID is convenient because once a business has established its inventory accuracy, it can start to use the same technology in a variety of other useful and creative ways. RFID tags are smarter and more flexible than a traditional barcode, which opens countless opportunities to use the technology for a better customer experience.
If a customer loses her receipt but needs to return a dress, she can just walk up to customer service, and a single scan of the RFID tag will display her purchase information. Then there are the opportunities for tracking warranties. An RFID tag on the bottom of a flat screen TV or speaker would show how long you’ve owned the item, making it easy to confirm when repair costs should be covered by the manufacturer. And, of course, there are the big picture opportunities like Amazon Go’s checkout-free stores.
While RFID technology can be used in countless situations, there are a few more common ways companies are currently implementing it to improve the customer experience, optimize loss prevention, and better sync showroom and stockroom.
Self Checkouts, Warranty Tracking, & Magic Mirrors for Better Experiences
“Retail has to reinvent itself to make you want to get in your car and go have an experience somewhere,” Carl said. “They’ve got to find a way to make that work.”
In today’s web-centric market, it’s imperative for brick-and-mortar retailers to attract customers to their stores. Ultimately, it’s the personalized experience that keeps people coming through the doors. Consumers still like to see, touch, feel, and try on an item before making a purchase. “If you want to buy a TV, you kind of want to see it,” Carl said.
RFID lets those experiences happen more seamlessly, optimizing the time customers spend in stores — and actually helping improve that experience long after an item goes home with them. Beyond the obvious benefits of receipt-free returns and trackable warranties, there are other major developments underway.
“[With] inventory accuracy as your foundation…you start to say, I’d like to do magic mirrors in my fitting room,” Carl said, referring to the rising trend in smart fitting rooms, where customers at brands like Rebecca Minkoff use large touch screens to select colors and sizes.
They can change lighting settings to see what clothing will look like in real life, not just the store. The ultimate goal is to let customers make informed, confident purchases straight from the dressing room.
“Or maybe I want to enable my customer to check themselves out,” Carl went on. “You can do that with RFID. Even without an RFID enabled phone, you can scan an item’s barcode and check yourself out.”
Current self-checkout systems are temperamental at best. Finding barcodes requires unfolding clothing or turning heavy or awkward items over. Any security tags that need to be removed or confusion around the process and a clerk has to take his or her attention away from helping other customers to assist the self-checkout shopper.
With RFID, a clerk could walk up to a customer who’s ready to checkout anywhere in the store and scan their items, hand them a bag, and send them on their way. And the self-checkout lane? The RFID range is up to 30 feet, so there’s no need to have the tag in your eyesight to track, process, or purchase an item.
Smart Tags Provide a Convenient Solution for Loss Prevention
Probably one of the most appealing perks to RFID technology is that it can also be used as a loss prevention tool. Now the technology businesses use to manage inventory can also track lost items.
“When we get into loss prevention and keeping people from stealing product, we’re leveraging this same technology, again something unique to Checkpoint,” he explained. “Electronic article surveillance (EAS) for loss prevention have been around for 40 to 50 years. They may work but only have one purpose. If you’re able to add an array of other uses, it’s big news.”
Because RFID allows you to track inventory with much more accuracy, it also means that stolen inventory is equally well tracked. Carl told us RFID is special because it lets retailers know exactly what an item is and where it’s located. The tags create a type of unique “license plate,” as he put it.
“The tag says, ‘That specific item just left the store. What are you going to do about it?’” Carl said. “Maybe you’re not going to do anything. Maybe you’re going to just document it in your inventory. But at least now you’re keeping up with your inventory accuracy.”
Creating Visibility Between the Showroom and Stockroom
Going back to the empty shelf and the confused clerk who can’t find the item you need even though it’s allegedly in stock — RFID solves that problem, too. Because it improves inventory accuracy dramatically, there isn’t a disconnect between showroom and stockroom so the on-shelf availability increases.
By putting an end to that confusion, businesses save time because RFID software provides a comprehensive view of what’s actually in stock in real time. They save money, too, by cutting down on worker time and making sure items are actually available to purchase when they’re wanted, thus avoiding frustrated — and lost — customers.
“By knowing what’s in the stock room, I can go get it and put it back on the sales floor,” Carl said. “That’s certainly going to save time for the people in the store and save retailers money. Anytime you’re trying to find something, this is going to help.”
RFID Adoption is on the Rise Throughout the Retail Industry
Based on Bloomberg’s projection, 8 billion RFID tags will be purchased in 2017. But perhaps what’s more interesting is how the rise of adoption is taking place in different parts of the industry.
Big box stores find the technology essential for accurately tracking merchandise, but so too do the luxury brands with their own retail locations.
“You know, they don’t want to be discounted in the department stores. They want to have their brand maintain its identity and value,” Carl explained. “So one way of doing that is opening up their own retail stores and having multi-channel strategies. And since they’re already having to tag for department stores, it’s very easy for them to do that.”
What was once a newsworthy stunt by Amazon is now becoming technology. In fact, based on those skyrocketing adoption numbers, RFID is poised to play a role in almost every shopping experience in the future.