As more retailers are shifting their inventory practices by switching to RFID, there has been one company that has been ahead of the curve. Macy’s is one of the biggest retailers in the world, and they have captured the attention of other retailers.
Since they switched to RFID readers, their inventory has become more efficient, allowing them to become a bigger and better run retail company. What is it that sets Macy’s apart from other retailers, especially when the science shows that RFID readers make inventory quicker, and shopping a more interactive experience for their customers?
Behind Macy’s Success
When Macy’s decided to use RFID readers in 2012, they knew they stumbled on something great. They announced all their items would be RFID-tagged as soon as the end of 2017. Macy’s switched to the RFID readers, and they saw decreases in inventory variances from anywhere between 2 and 4.5 percent. It also decreased their display shortages from 30 percent down to between 4 and 6 percent. They also were able to produce a better markdown for their Women’s Shoe Department, allowing them to give better prices to their customers.
While the technology had been available for over ten years, it still took them a long time to use it. At first, it appeared the technology was overestimating their returns, and it was expensive to implement a whole system into a company.
Though Wal-Mart had RFID technology installed RFID readers for their own inventory, they decided not to follow with the demands from the RFID companies. Since the technology was still new, and RFID producers wanted retailers to follow their rules, they turned a lot of companies off to the new technology. After seeing the success of RFID in Macy’s, perhaps more retailers are more willing to try them out.
Success of RFID Readers
RFID have started to see success in the retail industry, and if the pattern stays the same, it is possible they will see more extensive growth in the coming years. In 2016, there were 5 billion RFID tags used by the retailers. Not too bad for an industry that has been around for a while. In 2017, the RFID industry is expected to grow their numbers over 7 billion, allowing them to be more centralized in the retail industry. Considering how much money they have saved retailers and ecommerce companies, it’s not surprising to see them expanding.
One thing that helped the RFID industry is in part of ecommerce companies, like Amazon. It can become confusing and disoriented when thousands, even millions of people are making online purchases. RFID readers allows ecommerce companies to be more efficient with their products, allows them to ship them to the right customers, and keeps up to date inventory purchases. Not only does this help the company keep track of their inventory, consumers can see what is still available in real time.
Why Have Retailers Hesitated Installing RFID Readers?
There are many reasons why some retailers have opted not to implement their own RFID reader system. Some companies prefer to do their inventory with pen and paper, while others have found implementing a new system can be expensive and time consuming.
However, as the technology for RFID readers becomes more affordable, more companies can take advantage of RFID readers. Macy’s just happened to understand the technology, and how it can improve their bottom line and make them more efficient. Some companies have decided that the old ways still work for them, but eventually, they will need to implement their own RFID system to stay competitive.
Future of RFID Technology
RFID technology has boomed in recent years, and should continue to expand, especially in the retail industry. They are expected to have an annual compound growth of 22.4 percent through 2018. In just a few years, there is an expectancy of 25 billion tags by 2020, and that is just for apparel and shoes, allowing other retailers to jump in on the tech. For those looking at getting in on the RFID train, there are plenty of options, and as the demand for RFID technology becomes bigger, more RFID companies should start popping up.
Macy’s has taken extreme advantage of RFID technology, and their numbers are quite impressive. They have been able to lower their shortages down to new lows, they can provide better prices for their customers, and improves the accuracy of their inventory.
Any retailer can benefit from RFID technology, and the demand for any RFID tech is going to go up. Finding a company that can answer your questions regarding RFID technology is a good stepping stone to understanding how your company can incorporate the tech.