Be it the quandary of long waiting lines at the billing counter or the tedious task of tracking items inside the shop, the troubles will wean away soon as Smart Label System, also called RFID (Radio Frequency Identification), comes to the rescue of retailers and customers alike promising to “automatically” track every single item that a customer puts in the shopping cart while confiscating the boring procedure of putting each item manually under the scanner separately as in UPC bar code system. Apart from providing convenience to the consumers in billing, it also helps in other retail functions like promotion tracking inventory management, brand authentication, asset tracking, inventory visibility in the supply chain and many more.
Bar code vis-à-vis RFID
It can be said that RFID is:
- “God Send” as it can scan multiple tags at a time unlike barcode system which takes one at a time.
- Useful in capturing a range more than the restricted range of barcode system which is 30-40 feet.
- Useful in reading and writing in comparison to barcode that can only read.
- Full of conveniences like changing tags, updating and locking unlike the barcode technology.
Apart from retailers who are reaping the advantages of RFID, benefits to the customers are also multi-fold:
a) Frequent Shoppers Care - A RFID tag attached to the customer’s loyalty card allows the RFID reader placed at the retail store entrance to pick the customers presence at the store & retail chain employees can assist the customer in shopping, leading to enhanced customer satisfaction.
b) Guiding Customers In the Store - Strategically placed RFID reader at vantage points in the store coupled with the hand-held display carried by the customer allows the retailer to guide the customer to the items that he needs quickly.
c) Priority Check-out - Helps the retailer in implementing priority checkout lanes for the frequent shoppers.
As the name suggests, the technology uses radio waves for communication between readers and the reading object tagged for tracking purpose of an item. So, the technology thrives on Tags and Readers.
Also, like the barcodes, it doesn’t survive on lines. It can be hidden inside the package, carton etc.
Recently, an RFID was used on an ant as part of research, which only proves how miniature a beneficiary of the technology can be.
- Promotional Tracking: Boosts marketing by deploying promotional displays and synchronising them with advertising and marketing efforts.
- In store Inventory management:
a) Items: Reduces time and cost of physical inventory. Eliminates stock outs of product categories.
b) Palletes: Reduces cost of searching, accurate inventory and speeds up distribution and retrieval of products.
- Brand Authentication: Eliminates counterfeiting and protects brand integrity by eliminating inessentials.
- Inventory Visibility in the Supply Chain: Reduces stock outs, reduces inventory ageing and working capital requirement.
- Asset Tracking: Finds lost assets and ensures accurate billing.
Sanjeet Banerji, Sr. Vice President, Datamatics Global Services Limited shared, “At Datamatics, we have worked on RFID based solutions for a few Original Equipment Manufacturer (OEM) customers in Europe as well as U.S. Number of our end customers (customers of OEM's) have moved away from traditional barcode code based tracking solution to RFID based. Many of them have also opted for hybrid solutions - Barcode & RFID working side by side”.
Cost of implementation
As compared to barcode solution system, cost of implementation of a RFID based tracking & reading solution for a retailer is high. However, the advantages of the RFID based solution are far too many to override the disadvantages. Also since the technology is maturing, the reader & tag costs are coming down drastically.
Banerji further added, “Even though currently the implementation cost of RFID based solution may be higher, the day-to-day runtime cost of RFID based solution is significantly lower. As per one of our retail customers, the inventory taking time in a typical store with RFID solution is lower by 70-90 per cent than a store with barcode based solution of same size. This is a huge saving in terms of the man-power cost & at the same time it frees the retail employees for other important tasks in the store.
In terms of the accuracy RFID based solution is far superior than the Barcode based solution. Enhanced accuracy of the RFID based solution again results in lower run-time cost”.
Some common problems are Reader and Tag collision. Reader collision occurs when signals from two or more Readers overlap. Tag collision occurs when there are numerous tags in a small area but since the read time is fast, there is a danger of collision.
Conclusion: The burgeoning modern trade which is struggling to enhance their retail operations is finding RFID to be a boon. Yet, there is a slow adoption because of lack of awareness and the misconception that it is a costly affair. I am sure, as the competition becomes more intense, it will be adopted by one and all.