The Future of Retail: How RFID Technology is Driving Cost Efficiencies and Improving Customer Experience
More than 90 percent of the world’s retailers are investing in visibility platforms that leverage RFID technology and IoT to deliver vital insights.
A recent study that compared metrics between barcode-scanned data against data captured from RFID tags came to these conclusions:
- Retailers who use RFID technology for inventory, logistics, and fulfillment achieved 99.9 percent accuracy.
- For inbound and outbound shipments where RFID was not implemented, almost 70 percent had errors in picking, shipping, and receiving. These errors resulted in inventory inaccuracy and multiple chargebacks, creating significant cost inefficiencies.
Further to the study’s findings, companies that attempted to implement “workarounds” ended up facing additional errors. Some of these companies have actually turned a blind eye to the situation, accepting the losses as the cost of doing business. In other cases, the errors have not been acknowledged at all.
The problem inherent with this way of thinking is that, sooner or later, it is going to result in a poor customer experience and loss of business.
RFID enables omnichannel
In an ever-more competitive global business landscape, there is an expectation of omnichannel accuracy through every process.
Some of the ways that RFID enables omnichannel retail include:
- Accurate tracking capabilities throughout the supply chain
- Reduce unnecessary inventory costs due to overstock or out-of-stock
- Improves quality control
- Enables quality assurance
- Reduces labor requirements
- Improves safety from end-to-end
- Provides global inventory visibility
- Supports transparency on the customer-facing side
- Reduces returns
- Reduces the burden on support and customer service
- Enhances the customer experience
How RFID technology improves the customer experience
Even after items have left the warehouse, RFID tags can provide you with critical insights about how consumers interact with the products. When a product is sold, and the RFID tag is scanned, it delivers that information to all of your connected platforms, indicating one less item in inventory.
Data on the sale and all other connected actions are then delivered to the appropriate departments. Buyers know what they need to replenish, marketing knows what products are or are not selling, and production knows what they need to produce.
On the customer-facing side, RFID enables real-time inventory, reducing buyer frustration due to product unavailability. It can tell them what stores have the product in stock, and it will allow them to buy it online for in-store pickup or request a hold.
When an RFID-tagged item is purchased online, the customer can track it through the fulfillment journey until it reaches their door.
Driving efficiencies at the store level
At the store level, sales associates will know what products are out-of-stock, and where to find specific items and sizes within the store itself. If a product is returned, scanning it back into the system tells all related departments that this has happened, enabling more expedient refunds.
If your business goals include implementing or improving your omnichannel approach, RFID technology should be a frontline strategy. To learn more about what RFID and IoT can do for your retail enterprise, reach out today.