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May9,2017
DeborahWeinswig,ManagingDirector,FungGlobalRetail&[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
Retail Business Technology Expo 2017: Current and Future Applications of RFID in Retail
Source:FungGlobalRetail&Technology
1) Thisweek,FungGlobalRetail&TechnologyisinLondonattendingtheRetailBusinessTechnologyExpo(RBTE)2017,Europe’slargestretailsolutionsshow.Thetwo-dayeventshowcasesthelatesttechnologysolutionsandtheirapplicationsinretail.Onthefirstdayoftheexpo,wefocusedontheretailapplicationsofradiofrequencyidentification(RFID).
2) LeadingUKretailersMarks&Spencer(M&S),JohnLewisandRiverIslandcurrentlyuseRFIDforinventorymanagement,inparticulartoincreasestockaccuracy.TheygaugetheimpactofRFIDontheiroperationsbymeasuringtheadditionalsalesgeneratedfromimprovedstockmanagement.
3) RetailersseetheintegrationofRFIDsolutionsthroughoutthesupplychainasthenextstep.FurtherapplicationsofRFIDtechnologyinstoreswillenableincreasinglyintegratedsolutionsthatincorporateanumberoffeaturesandfunctionsinasingletag,includingpaymentsolutions,dynamicpricing,real-timeinventory,antitheftsystemsandinteractionwithothersmartdevices.
OnMonday,May8,theFungGlobalRetail&TechnologyteamwasinLondontoattendthefirstdayofRBTE2017,Europe’slargestretailsolutionsshow.Theeventshowcasesthelatestretailtechnologysolutionsinareassuchasomnichannel,payments,loyalty,supplychain,lossprevention,e-commerce,RFIDandanalytics.
Onthefirstdayoftheevent,wefocusedonRFID.WeattendedapaneldiscussioninwhichexecutivesfromthreeleadingUKretailers—M&S,JohnLewisandRiverIsland—sharedhowtheircompaniesusethetechnologyintheiroperations,andwevisitedtheexhibitorboothsofanumberofcompaniesthatofferin-storeRFIDsolutions.
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May9,2017
DeborahWeinswig,ManagingDirector,FungGlobalRetail&[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
HowRetailersUseRFIDinRealLifeandHowTheyWillUseitintheFutureRFIDisaversatiletechnologythathasanumberofapplicationsinretailstores.Inthepaneldiscussionweattended,weheardhowthreeleadingUKretailersareusingthetechnologytomaketheiroperationsmoreefficient.ParticipatinginthepanelwereRichardJenkins,HeadofLossPrevention&RFIDatM&S;RobMitchell,ManagerofStockManagementOperationsatJohnLewis;andMartinSpeed,LossPreventionManageratRiverIsland.Thetalktouchedonthefollowingpoints:
• HowRFIDtechnologyiscurrentlyusedinretailoperations:Thethreeretailersagreedthatthetechnologyismainlyusedforinventorymanagementinstores,inparticulartoincreasestockaccuracy.SpeedsaidthatRiverIslandusesRFIDforstockreplenishmentandtoobtainreal-timeinformationonstocklevelsatalltimes.RFIDprovidesitem-levelvisibility,enablingtheretailertohaveauniqueidentifierforeachitemandtoknowimmediatelywhensomethingisoutofstock.AccordingtoJenkinsofM&S,retailersthatuseRFIDincreasethelevelofstockaccuracyby40%comparedwithcompetitorsthatdonotuseit.
• HowtomeasurethebenefitsofRFID:JenkinsandSpeedsaidthatthebestwaytogaugehowtheuseofRFIDininventorymanagementimpactsoperationsistomeasuretheadditionalsalesgeneratedfromimprovedstockmanagement.Jenkinsaddedthattakingonlytoplinesalesasameasureisproblematic,becausemanyotherfactors—includingseasonalityandchangingconsumerpreferences—comeintoplay,whichmeansthathigherstockaccuracydoesnotalwaystranslateintoincreasedsales.Therefore,retailersmusttakethoseotherfactorsintoaccountwhenmeasuringRFID’simpactonoperations.
• ThenextstepintheapplicationofRFIDinretail:Thethreepanelistsagreedthat,althoughRFIDismainlyusedforin-storeinventorymanagementtoday,thenextstepwouldbetheapplicationofRFIDtothesupplychainandlogistics.Thiswouldhelpretailersincreaseitem-levelvisibilitythroughouttheentireproductlifecycle,enablingfurtherdistribution-centerinventoryaccuracyandmoreefficientmanagementofreturneditems.
ThetalkconcludedwithanoteonRFIDapplicationsforlossprevention.WhileJenkinssaidthatM&Sdoesnotusethetechnologyforlossprevention,SpeedsaidthatRiverIslandseesopportunitiesinusingRFIDtotestnewformsofsecuritytags.SinceRFID-enabledsensorscangatherdatainrealtime,theycouldhelpretailersquicklyidentifywhichloss-preventionsolutionsworkbest.
Source:FungGlobalRetail&Technology
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May9,2017
DeborahWeinswig,ManagingDirector,FungGlobalRetail&[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
Inadditiontoattendingthepaneldiscussion,wespoketoexecutivesfromtwoexibitingcompanies—MishiPayandMariEllaLabels—whichprovideretailerswithRFID-enabledsolutionsfortheirbrick-and-mortaroperations.
• MishiPayprovidesasolutionthateliminatescheckoutlines.Itstechnologyenablesashoppervisitingaphysicalstoretopaybycredit/debitcardorApplePayafterscanninganitemthroughanapp.Oncethepaymentiscomplete,theRFIDtagattachedtotheitemisdeactivated,andthecustomercanwalkoutofthestorewithouttriggeringtheantitheftalarmsystem.
Source:FungGlobalRetail&Technology
• MariEllaLabelsoffersasmartpricetag,EllaFashion,whichusesRFIDtechnologyfordynamicpricing,allowingretailerstochangethepriceofaniteminrealtime.Thetagalsotrackstheitemtowhichitisattached,enablingreal-timeinventoryandantitheftfeatures.Moreover,thetagcanactivatedevices,suchasconnectedmirrorsinfittingrooms,thatinteractwithshoppersandprovidethemwithfurtherproductinformationandrelevantadvice.
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May9,2017
DeborahWeinswig,ManagingDirector,FungGlobalRetail&[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
Source:FungGlobalRetail&Technology
TheseexamplesofRFIDapplicationsshowhowdifferentsolutionscanbemergedintofewerandsmallerdevices(suchaspricetags)andhowusingRFIDcanhelpretailerssignificantlyimprovein-storeconversionbysolvingproblemssuchasshopping-basketabandonment.TheexecutivefromMishiPaysharedsomefiguresthatquantifytheproblem:70%ofshopperswouldrathernotbuysomethingthanhavetowaitinlineforfiveminutestocheckout,andthetotalsaleslostfromcustomersabandoningtheircartsduetocheckoutlinesisestimatedtobe$200billionglobally.
KeyTakeawaysOurmaintakeawayfromthefirstdayatRBTE2017isthatleadingretailersintheUKarestillusingRFIDtechnologymainlyforinventorymanagementandstockaccuracyimprovement.Thenextstepwillbetheintegrationofthetechnologythroughoutthesupplychaintoincreaseitem-levelvisibilityindistributioncentersandimprovethehandlingofreturns.Futurein-storeapplicationsofRFIDwillenableincreasinglyintegratedsolutionsthatcombine,inasingletag,functionalitythatrangesfrompaymentsolutionsanddynamicpricing,toreal-timeinventory,toantitheftsystemsandinteractionwithothersmartdevices.
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May9,2017
DeborahWeinswig,ManagingDirector,FungGlobalRetail&[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
DeborahWeinswig,CPAManagingDirectorFungGlobalRetail&TechnologyNewYork:917.655.6790HongKong:852.6119.1779China:86.186.1420.3016deborahweinswig@fung1937.comFilippoBattainiResearchAssociate
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