RFID Implementation Forum
2013 Spring Conference
Retail Only Conference
Annual Fall Conference
RFID - Getting Started...
By Paul Arguin, r-pac International
Many suppliers to large retailers in the United States have been requested to provide their product with Radio Frequency Identification (RFID). This phenomenon is not only occurring in the United States, but throughout Europe and the Americas. The selected product suppliers have little choice but to embrace the technology to be compliant with their retail customers. It is important for a supplier to understand the benefits of RFID and the associated Electronic Product Code (EPC) for the retailer. It is also important for a supplier to understand what potential benefits they can gain within their own "four walls" from having EPC-enabled product.
Here in the United States, retailers such as Walmart, Macy's, jcpenney, Lord & Taylor, Kohl's, and others who have not announced, are using RFID and EPC-enabled product to gain benefit. The scale of each deployment varies, but it is safe to say that each has seen tremendous benefit from the increase in visibility and accuracy of inventory.
Each retailer is looking for an edge to better serve their consumer base. EPC-enabled product assists in providing this edge. The principle is simple. An EPC has roots in a UPC (more precisely a GTIN) and becomes unique by adding a serial number. So if you have a number of a specific product, each of those particular items will have the same UPC, but will be unique since their serial numbers vary. If an individual is taking an inventory of a shelf using UPC's, each item would need to be picked up and scanned. Using RFID, the scan is done via radio waves. The person doing an inventory would simply have to scan by waving the scanner in front of the shelf to be inventoried and the result would be obtained – in a fraction of the time and with accuracy.
Using the simplicity and accuracy of scans, retailers are executing several business use cases to achieve process improvements and competitive advantages. One benefit is the ease and speed of taking inventory counts. This allows for an accurate understanding of what is on the retailer shelf. For instance, retailers can ensure that all variations of product (i.e., style, color, and sizes) that are supposed to be displayed are actually displayed for the consumer. A quick scan of a shelf can gather the inventory represented and then software can compare the scan to the planogram to understand what the discrepancies are and assist retailer staff in correcting the display.
Many use cases have been documented and are in practice. The University of Arkansas has been researching the use of RFID with Retailers and has written several white papers.1 One such paper is An Empirical Study of Potential Uses of RFID in the Apparel Retail Supply Chain (Waller, Cromhout, Patton, Hardgrave and Williams). This paper details the apparel supply chain and highlights sixty use cases for RFID that not only directly benefit the retailer, but have insight into areas the supplier can implement improved processes using EPC-enabled goods.
As shown in the many white papers and talked about in many seminars, use of EPC-enabled product contributes to an increase in sales by ensuring product is available to the consumer, increases perpetual inventory accuracy and safety stock levels, potentially reduces labor costs by implementing automated processes, reduces chargebacks by having fewer errors, etc. The question is not if a supplier can achieve a ROI by using EPC-enabled goods and RFID, but which process to improve first, given all it can do.
The question of how to get started has been the subject of working groups and discussions. Suppliers should engage with proven RFID technology providers. The most critical aspect of creating EPC-enabled product is to select the correct RFID tag for you product and to encode the tag properly and without duplication of the EPC. This is not a project to take lightly. Several retailers have different tagging requirements due to differences in the use cases they are implementing. Further, encoding and managing serialization can be complex. The quickest and easiest way to start is to comply with retailer requests while developing a plan to implement the use of the EPC-enabled product for your own use cases. Engaging with a proven technology provider, such as r-pac International or Avery, can guarantee a successful start and implementation of an RFID program to not only comply, but gain process improvements in your supply chain. Using a Service Bureau style solution will allow you to order printed and encoded RFID labels or tickets that your factories can simply attach to the correct product. For those desiring an in-plant print solution, these companies can guide you to successful implementation including the appropriate use of software tools and hardware.
The technology is proven and it does not have to be difficult to implement. Partner with a proven RFID technology provider and take small steps from compliance to full implementation. This technology can improve your organization's processes so embrace its use and find benefits within your own "four walls."
Paul Arguin, Senior Director, RFID Development, r-pac International
Paul Arguin is Senior Director, RFID Development, at r-pac International, the premier supplier of RFID tags to retailers and suppliers worldwide, and has over 20 years of experience working with cutting edge engineering and technology. He has formal education including advanced degrees in various disciplines of Engineering and Management. Previous to r-pac, Paul worked with Conair Corporation beginning in 2002 and accepted the position of Director of Engineering and Technology for Conair's subsidiary, USA ID in 2006. Paul's work experience has ranged from sophisticated large-scale computer systems for DoD projects to large dot-com infrastructures in start up businesses to the present with RFID and GPS technologies in the cargo security and supply chain space.