RFID or radio frequency identification is constantly touted as an all-encompassing solution for inventory management and supply chain efficiency in the retail industry. But, only a few business organizations are aware of what exactly RFID can do and how it can create positive changes.
The experts offering quality yet affordable RFID retail inventory management systems said the technology gained massive popularity over the past few years. Big brands like Target and Amazon have made huge commitments to RFID incorporation. Researches have shown that two-thirds of the top thirty apparel retailers are also applying item-level RFID.
Now how can you know if you need RFID! Have you been missing out on customers and experiencing a constant decrease in the profit margin? Now while you can perceive them as common commercial issues, know that they can be successfully resolved by RFID. Mentioned below are two more signs that you are absolutely ready for RFID.
You Purchase Excessive Inventory
Are your products high on demand? If yes, know that this comes with a fair share of challenges. You must make sure all the shelves are piled with the correct products. Telling consumers a product went out-of-stock is perhaps the last thing on your checklist. It, after all, takes money out from your wallet and puts it in the competitor’s.
To compensate, you purchase so much inventory that you eliminate the chances of running out forever. But having your capital tied to inventory only is a huge risk. On average, the businesses stock at least 50% more inventory than they require. That’s a lot of money that they can spend elsewhere – advertising, new hires, Jacuzzis (maybe)!
On a serious note, this is the most neglected problem in retail. Investing in an integrated inventory management RFID system can help. With RFID, you can find out which items are selling faster and when. Thus, you know you have to order more of what is selling and less of what is just sitting on the shelves. Since RFID provides you minute glimpses of your inventory, you may keep the expenses down by ordering the right items at the right time. No more overload.
45% of Your Inventory Grew Legs and Ran Away
How accurate is your inventory management system? You probably think it is almost close to 100%. Well, it is not. The managers ignore this problem because they can never have a completely accurate reading of the inventory. They just have to assume that they are doing a good job.
A traditional inventory system is about 55% accurate. Three out of five items in the warehouse or in the store are not present or unaccounted for. This statistic hampered the sleep of several entrepreneurs. Now bigger companies may be able to bridge the gap, but for the smaller businesses, it can be difficult to hover on just the edge of inventory catastrophe.
Several experts said that with an RFID warehouse management system, the inventory accuracy will go up to a whopping 97%. Fulfilling orders and predicting potential sales will become immensely easy.
Over the years, the manufacturers and providers have talked to thousands of companies regarding the advantages of RFID technology. It is not, by the way, a hard sell. Radio frequency identification has multiple applications that could positively impact almost every industry.