RFID in Retail: Faster Stocktaking and Accurate Inventory

Stocktaking is one of the most time-consuming tasks in a store. Every item has to be counted, often after closing, and the result still is not always right. At the same time, customers expect the stock level in the online shop to reflect what is actually in the store. RFID is a technology that can make both stocktaking and inventory management considerably easier.

What is RFID?

RFID stands for Radio Frequency Identification. An RFID tag contains a small chip and an antenna. When the tag comes within range of a reader, it sends back a unique number that identifies that specific item.

Unlike barcodes, RFID does not need a line of sight. The reader can register many tags at once, even through boxes and in stacks of clothing. Retail usually uses UHF RFID, which has a longer read range than, for example, the technology used in access cards.

Tags

RFID tags can be built into the swing ticket, sewn into the garment or attached as a separate label. Some brands already tag their products at the manufacturer. Every tag has a unique number, so each individual item can be distinguished, not just the product line.

Readers

• Handheld readers: staff walk around the store reading the items. Used for stocktaking and for finding products.
• Fixed readers: mounted at points such as goods-in, the tills or the entrance, registering items that pass.
• Readers at the till: can read items and connect to the till system.

Faster stocktaking

For many stores the biggest benefit is stocktaking. Instead of scanning each item, staff walk around with a handheld reader and read shelves, rails and the stockroom. It is much faster than counting by hand and can therefore be done more often.

More frequent stocktakes mean discrepancies are spotted earlier, stock levels are more accurate and the store can act before a product runs out on the shop floor.

How an RFID stocktake works

1. Products are tagged with RFID tags, either by the supplier or on arrival at the store.
2. Staff start a stocktake on the handheld reader or in the app that comes with the system.
3. Staff work methodically through the store and stockroom, zone by zone, reading shelves, rails and boxes.
4. The reader registers each unique tag, so the same item is never counted twice.
5. The result is compared with the expected stock level, and discrepancies are shown immediately.
6. Stock levels are updated in the inventory or ERP system, and therefore in the online shop as well.

Because the process is quicker, the store can count one product category at a time, for example every week, rather than doing a large stocktake a few times a year.

Accurate stock levels

In store

When stock levels are accurate, it becomes easier to order the right products, avoid running out and reduce overstock. The store can see when an item is in the stockroom but missing from the shop floor and replenish in time.

Online

For retailers selling both in store and online, accurate stock levels are essential. Click and collect, ship from store and online stock status only work if the store's figures are correct. RFID makes those figures easier to trust.

Finding products

With a handheld reader in search mode, staff can locate a specific item. The reader signals as it gets closer to the tag. This is useful when a customer asks for a particular size or when an online order needs picking.

RFID and theft prevention

In some solutions, RFID tags can also be used for theft prevention. Readers at the entrance register items that leave the store without being paid for. The advantage is that you can see exactly which item passed through, which gives a better basis for understanding shrinkage.

There are also solutions that combine RFID with traditional AM or RF security gates in the same installation. Which route is right depends on your range, your existing equipment and how suppliers tag their products.

Which stores is RFID right for?

RFID is particularly well suited to stores with:

• Many products in different sizes and colours, such as fashion, sports and footwear
• Sales both in store and online
• A need for frequent stocktakes
• Products that already arrive RFID-tagged from the supplier

For stores with few product lines or low margins per item, the cost of tags may need to be weighed against the benefits. A store visit and a review of the range give a better basis for the decision than general rules of thumb.

Things to consider before introducing RFID

• Tagging: should tags be applied by the supplier or in store? Tagging early in the supply chain saves work.
• Systems: RFID data needs to be connected to the till, inventory or ERP system to deliver its full value.
• Routines: decide how often you will count stock and how discrepancies are handled.
• Store environment: metal fixtures and liquids can affect reading and need to be factored into the planning.
• Network: fixed and handheld readers need a stable connection.
• Pilot: consider starting in one store or one product category and evaluating before rolling out more widely.

RFID and your staff

The technology delivers the best results when staff understand why it is being used. Show them how the handheld reader works, why it matters to cover the whole area and how discrepancies should be handled. When staff see that stock levels are more accurate and products are easier to find, using the tool becomes a natural part of the working day.

How StoreIQ can help

StoreIQ helps stores get started with RFID for stocktaking and inventory accuracy. We review your range, your systems and how products are tagged today, and propose a set-up with handheld readers, fixed readers and integration with your existing systems.

We can also combine RFID with security gates at the entrance and make sure the network can support the readers. Contact us and we will look at how RFID would fit your store.