Nowhere is inventory more complicated or critical than in retail. From apparel and jewelry to tools and electronics, the sheer volume of inventory exchanging hands is staggering. In 2021, retail sales in the U.S. alone were estimated at $6.523 billion.
Surprisingly, studies have found that approximately 46% of small and mid-size businesses still rely on antiquated manual inventory management. This tedious and time-consuming practice requires team members to manually update stock levels and inventory locations. The end result is unnecessary expenses and lower profit margins.
To combat these inefficiencies, many retailers are adopting RFID technology to protect their business and improve their inventory management.
In North America, 93% of retailers report they have RFID technology in various stages of deployment. Breaking it down…
- 47% practice full adoption,
- 37% are in the process of implementing, and
- 8% are in the pilot stage.
Compared to 2018, only 28% of retailers practiced full adoption, while 46% were still in the pilot stage. So why have so many retailers accelerated their adoption of RFID technology? Because it’s wildly beneficial to your operational success.
According to McKinsey & Company, there are three primary use cases for RFID in retail.
- Inventory Tracking
- Store Operations
- Customer Experience
Right out of the box, whether you’re using handheld RFID scanners or fixed RFID readers, the technology can provide exceptionally accurate data on inventory counts and locations. Retailer Lululemon Athletica used RFID to track their inventory with 98% accuracy throughout nearly 500 stores.
5 Advantages of RFID in Retail
The acceleration of the digital age has ushered in a monumental shift in how traditional brick-and-mortar stores and e-commerce retailers operate. The goal has always been to be more efficient while improving the customer experience.
While not a new technology, RFID has been supercharged with new inventory tracking software like MSM Solution’s PortalTrack. Whether you use a handheld scanner for manual inventory management or fixed RFID readers for automated inventory Tracking, the following advantages are a direct result of that technology integration.
Increased Inventory Visibility – With a complete and up-to-date look into your inventory, you know what you have and where it is. This saves you time and labor costs usually associated with manual inventory management. Plus, it helps you know when to restock in-demand products so you never disappoint your customers.
Improved Product Availability – To sell a product, you usually need to have it in hand. That can be difficult if your inventory is disorganized and easily misplaced. Most retailers report inventory accuracy between 65-75%. With RFID, that accuracy jumps to 93-99%, meaning you know what you have, so you can hand it off to your customer when the transaction is complete.
Better Process Efficiencies – From the factory to the shop floor, tracking and managing your inventory can be a challenge. With an RFID solution, you can use handheld or fixed scanners to simultaneously identify and document hundreds of individual items. Also, radio frequency technology doesn’t require a direct line of sight to work. Together, those two benefits mean that identification and documentation become much more efficient.
Accurate Real-Time Data – In brick-and-mortar stores, tracking data through manual inventory management often results in outdated information that doesn’t help you make timely decisions. RFID provides accurate, real-time data that allows you to understand your inventory counts, locations, customer preferences and purchasing trends.
Enhanced Customer Experience – While the most obvious benefits of deploying an RFID solution are centered around your inventory, you can’t dismiss how it affects the customer experience. The real-time visibility provides accurate inventory numbers, so customers are never left frustrated by unfulfilled or incomplete orders. Plus, having easy access to your inventory means focussing more on your customer without wasting time searching the back room for missing stock.
To better understand how to keep your business up-to-date with RFID technology, check out this article from our partner, Zebra Technologies.
And for more information on how to track and manage your inventory more efficiently with RFID solutions, contact MSM Solutions today.
