How To Harness RFID For Store Efficiency – RFID Q&A #2

Discover how RFID technology is revolutionizing operational efficiency in fashion retail stores. In this Q&A, Noortje van de Mast, Product Manager at Nedap Retail, explains how RFID optimizes store processes in three ways: inventory counts, receiving and sending shipments, and the POS process.


Daphne: Hi, my name is Daphne Brand, and I am a business developer, or even better said, an RFID enthusiast at Nedap Retail.

Today, I'm here together with Noortje van de Mast, and we're going to talk about operational efficiency in fashion retail.

Noortje, can you give us a small introduction about yourself?

Noortje: Yes, of course. My name is Noortje van de Mast. I'm a product manager at Nedap Retail, and that means that I'm responsible for developing and the product strategy of iD Cloud Store.

Daphne: Cool, and talking about operational efficiency; can you explain what operational efficiency means to you and why it is so important in fashion retail?

Noortje: Operational efficiency, as the name already says, is increasing the efficiency of in-store operations. This is really important because we see that customer experience and interaction with customers is more and more important, especially in flagship stores. On the other hand, we have fewer store associates because of the labor shortages all around the world. Next to that, store associates have even more tasks in the store. There are more digital initiatives, such as omnichannel solutions. So there's a lot to do with fewer people, and RFID can really help stores with that.

Daphne: OK, so you are saying that operational efficiency is becoming increasingly important in the stores but also for digital initiatives. Can you give us a little bit more insight about what in-store processes can be optimized with RFID?

Noortje: Yes, so typically, when a retailer starts with RFID, there are three processes that can be optimized. The first one is inventory counting. Without RFID, it can take up to days to count an entire store. Typically they do that once a year. With RFID, you can count 10,000 items per hour, so you can do that more often, having better accuracy of your inventory. You can also count on different sub-locations, so you count on your sales floor and you count in your stock room, and then you also know where items are in your store.

That's important for the second operation, which is searching for items. Because we know where items are in the store, this can be more efficient. For example, if customers ask for a certain item, but also if there's an online order or something that needs to be reserved for another store, you can easily find these items in your store.

The final operation is replenishment. Visually, we can see what items are in the store, but you cannot see from a pile of jeans if you have all the items. With RFID, we know: do we have all sizes or not? And what size do we have on the sales floor and what sizes do we have in the stockroom that you can replenish to your sales floor. You can even set targets with that in ID Cloud. So the visual merchandisers can set targets: for these types of products, we need five items on the sales floor. With these targets, visual merchandisers can guide associates in-store to make sure that the right items are available for customers.

Daphne: So you're saying it's counting and finding items, but also in-store replenishments are all processes that can be easily optimized with RFID technology. Are there also processes that can be optimized by RFID technology even outside the store?

Noortje: Yes, definitely. And then we're talking about shipments. We have incoming shipments, so shipments that come into the store to sell these items, but also outgoing shipments. Those are items that are sent to other stores or to DCs (distribution centers). Without RFID, you need to count them all manually, and with RFID, you can use an RFID handheld reader to do so, and there you have item-level information on what leaves the distribution centers and what comes in. So also for the suppliers, but also what goes to the stores. This makes the entire process even more efficient, also for later in stores. RFID can not only be used in stores, it can also be used in the supply chain in the distribution center, for example.

Daphne: Finally, I also know that one of the processes that is really important for a fashion retailer is the checkout process. Can RFID also help to optimize the checkout process at a fashion retailer?

Noortje: Yes, with RFID at your point of sale, you can increase the checkout process. Without RFID, you need your barcode scanner. You need to scan every individual item, and with RFID, you can scan them all at once, which increases the efficiency of this operation with 15 percent per checkout, which is really nice.

You can even make it more efficient if you also look at RFID EAS. Then you don't need these hard tags anymore, so you don't have to detach them when you have a checkout, but you also don't have to attach them when they enter your store. With the use of RFID EAS and RFID point of sale, you can even increase the efficiency by 50 percent, which is even more. Next to that, an advantage of having RFID at your point of sale is that you also directly know what items are sold. So for replenishment, you know directly what items you need to replenish to your sales floor, so it's again available for your customers.

Daphne: If I can summarize everything that you just said, then we can see that operational excellence is super important nowadays for a fashion retailer, and there's, for example, less staff, there are more tasks that need to be fulfilled, and there's a high expectation from the stores. So RFID can really help to optimize all the processes in the stores, in distribution centers, and I would also add the checkout process. I think it's really nice that RFID can do this. I really want to thank you for having this conversation with me, and I also want to thank you for watching and really happy to see you next time. Bye!