RFID Helps Florida Shoe Retailer Keep Its Customers From Walking Away

In the future, Peltz hopes to add several functions to the system, one of which is the ability to see, in real time, what is available in each of his company's four stores, as well as detect when a pair of shoes has been incorrectly shelved. If, for instance, a pair of women's shoes is shelved with men's footwear, he would like to be able to receive an alert from the reader or back-end software indicating the problem.

Peltz also envisions using a handheld reader that can be programmed to seek a specific pair of shoes, and then be waved across the shelves by a worker until that device detects that specific RFID number and emits an audible alert. That function, he says, he hopes to make possible with some changes to the software and the acquisition of a handheld device.

What's more, Peltz hopes to eventually use the system for security purposes, receiving a real-time alert if a box or case of shoes is carried through an RFID portal out of the store, listing exactly which merchandise is being removed.

Although it is difficult to quantify the return on investment to date, Peltz estimates that he has recouped his investment within the first year of the deployment. Since the tags are priced at 11 cents apiece, he says, this costs his company an average of $40,000 to $50,000 each year. Even with the added expense of the reader, he says, the increase in merchandise sales easily surpasses the overall outlay. "And that's not even calculating the more satisfied customer," he notes, "because the shoes they want are available, and the labor cost of doing inventories. There's a lot of cost with the system, but there is a lot of savings. We feel like we've reached an ROI."

Other retailers seem to have similar feelings about the benefits of attaching RFID tags to the items they sell, according to a recent study conducted by the Aberdeen Group (see Momentum Is Growing for Item-Level Tagging, Survey Says). And Wal-Mart Stores recently shifted its focus from tagging all pallets and cases to working with suppliers to tag items in categories in which the company and its partners will see the greatest benefits (see Wal-Mart Relaunches EPC RFID Effort, Starting With Men's Jeans and Basics).