How RFID Can Turn the Retail Supply Chain on its Head

Posted by Ken Lynch on Thu, Jun 28, 2012 @ 04:46 PM

stockroomIt’s no secret that technology is transforming the way we do business, but with some innovative thinking on the part of retailers, businesses are in store for a level of efficiency they’ve never seen before – in part, thanks to RFID.

These new efficiencies are coming in ways that, until now, have seemed counterintuitive. In a recent blog, Software Advice's Michael Koploy details how retailers are beginning to fill online orders with their in-store inventory – essentially turning their entire supply chain into one cooperative “warehouse.” This may seem like a nightmare to maintain, detrimental even, if you consider the possibility of more frequent stockouts, but in fact RFID has made this an incredibly viable option for the modern business world.

As retailers begin to incorporate RFID into their supply chains, tagging every piece of inventory and scanning items as they move from warehouse to distributor to retailer, suddenly enterprises are afforded a much higher level of visibility into the location of the various moving pieces of their business. Businesses are now able to treat their in-store inventory as an extension of their warehouse because RFID redefines what it means to track inventory – what was once a few teenagers counting boxes in the back room of a store with a clip board and pen is now a highly organized and incredibly accurate automated tracking system. It’s almost like having a crystal ball.

With an RFID system in place, retailers can have a more accurate picture of their inventory and feel comfortable knowing that they are moving their products in the right direction. Not only that, but using RFID to fill online orders from in-store inventory can actually lead to fewer stockouts, as the new level of visibility gives enterprises a better idea of which inventories are running low and when they need to be restocked. Additionally, businesses will see less of a need to implement markdown prices, as slow-moving inventory can be better distributed among the variety of retail outlets, and businesses will save on shipping and delivery costs since each retailer can now function as a distributer as well. 

It’s getting more and more difficult for businesses to ignore the benefits of RFID. What managers once thought could only serve enormous supply chains with equally-enormous budgets is now allowing retailers to modernize their entire business platform. RFID is redefining what it means to have visibility into business operations, and as the scope of RFID implementation continues to expand and simplify, it’s becoming far easier for retailers to increase profits by understanding their company at a more granular level. RFID very quickly begins to pay for itself, and it certainly makes life easier for everyone from enterprise managers to the guys in the back who can now focus on greeting customers instead of counting boxes.

Tags: RFID, Retail, Supply Chain

Subscribe by Email

Most Popular Posts

Browse by Tag

Ask the Experts 

Do you have a question about one of our products that you'd like us to answer on our Forum?

Post Your Question