Item-level RFID Provides Consumers with Highly Accurate Store Inventory Levels, Greatly Improves Buy On-Line, Pick Up In-Store Success

Slowly but we would say mostly steadily, item-level RFID tagging, especially in soft goods, is gaining traction- if not quite yet critical mass.

Macy's has said it will have all items in its stores tagged by the end of 2017. Target is rapidly moving ahead with its RFID tagging strategy and publicly touting its benefits. Kohl's is said to be working hard on RFID tests in its stores.

Supply Chain Digest Says... "RFID puts the power of accurate inventory in the power of hands of the people that need it the most, the educators and our guests," Lululemon's Aitken says. What do you say? Click here to send us your comments Click here to see reader feedback

Another specialty retailer that has moved down the RFID path is Lululemon. Last month, Jonathan Aitken, IT Director Retail and RFID for the chain, wrote an interesting column on LinkedIn on his experience using the company's technology platform as a consumer.

Aitken wanted to buy a certain shirt that was soon to be gone from Lululemon shelves. Going to the closest store to his office, he found the shirt on the store floor, but not in the size he needed.

He is how Aitken tells the story from there.

"Instead of asking for help from one of our amazing educators (what we call store associates), and asking them to locate one for me in a nearby store or asking them to check if there was one in the back, I pulled out my iPhone and used the Lululemon app to scan the barcode on the hangtag," Aitkin said. "Our RFID ecosystem sprang into action."

That app, available for android as well as Apple iOS, uses the phone's camera to scan the bar code (not read the RFID tag) on the hang tag. That scan then pulls up the product detail page on Lululemon's ecommerce site.

It then uses the company's "back end integrations" to RFID to do a real-time inventory check across all stores, sorted by the ones closest to Aitken, based on his phone's location.

"I could see that there was no size large in this store, but there was a large in our Robson Street flagship store two kilometers away downtown and they had two of them in stock!" Aitken wrote. "After dinner, I checked the inventory again and my phone showed that there were still two larges left and the update was less than five minutes ago."

Arriving at the store, he went to the rack confident that the item would be there.

"As our RFID Ops team is fond of saying 'RFID don't lie,'" Aitken wrote, adding that store inventories are now 98%+ accurate.

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At the recent NRF show in New York City, Aitken said that before the RFID program, the company internally tested its buy on-line, pick up in store service in New York.

More than half the time, Lululemon was unable to fill the test orders because the store inventories were wrong. Now after RFID, it only has inventory issues on 1-4% of on-line orders, depending on the day.

Lululemon Puts Power In Consumers' Hands to See Inventory Across the Network

Goods are tagged Lululemon vendors, and read as they are received at the store. Once a week, educators in every store cycle count the entire store front and back, a process that takes two of them less than two hours.

"This trues up the inventory to account for shrink and movement within the store," Aitken said. "The cycle count also makes the daily replenishment process accurate, so our employees always know what is in the front of the store and what is in the back of the store and how much to restock to the floor. Once a week the system also updates the allocations team so they know what to send to the stores even if there was shrink."

Items are then read at the point of sale system when they are sold. All of the data about the inventory is pushed to the Cloud. The system also generates a task to move an item available in the backroom to the store floor if the last one is sold or goes missing.

"RFID puts the power of accurate inventory in the power of hands of the people that need it the most, the educators and our guests," Aitken concludes.

How much traction is RFID gaining in retail? Is it just inevitable that this is how it will go? Let us know your thoughts at the Feedback button below.

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