Clothing Retailers Hang Hopes on Item-Level RFID
The question of a "tipping point" for the use of item-level radio frequency identification in apparel retailing has been around for years as prominent merchants such as American Apparel, Bloomingdale’s, J.C. Penney and Macy’s have used the technology to better manage stock and reduce shrink.
In a RetailWire poll last September, one-third of respondents said that 51 percent or more of all apparel merchants would be using item-level radio frequency identification technology in the next five years. Half said somewhere between 26 and 50 percent of clothing store operators would be doing the same.
A survey conducted by Accenture for the VICS (Voluntary Interindustry Commerce Solutions Association) Item-Level RFID Initiative bears out the RetailWire findings. According to the report, Item-Level RFID: A Competitive Differentiator, "Most major apparel and footwear retailers will adopt RFID technology in some part of their business within the next three-five years if recent momentum continues."
The latest chain to go all-in on item-level RFID is American Apparel, which is rolling out the technology to all of its stores in the Americas, Asia, Australia and Europe after two years of testing.
According to the Accenture/VICS research, American Apparel has gained 99 percent greater inventory accuracy and improved sales by 14 percent where it has used item-level RFID to date. Stacy Shulman, VP of technology for American Apparel, recently told RFID Journal that internal shrink has dropped up to 75 percent at stores with item-level tags.
- American Apparel Adopting RFID at Every Store – RFID Journal
- Item-Level RFID: A Competitive Differentiator – VICS/Accenture
- Macy’s Moves to Item-Level Tracking Using RFID – RetailWire
Discussion Questions: What do you see as the greatest benefits for clothing and footwear retailers using item-level RFID? What impediments, if any, are slowing adoption of the technology in apparel stores?