U.S. Apparel Retailers Drive RFID Adoption

VILRI matters, because it is embracing standards and developing best practices for the industry. This is important, and here's why: If one retailer were to adopt one type of data structure on a tag, while another adopted a different type, suppliers would need to manage separate inventories. If one retailer wanted RFID tags to be put in hangtags, but another wanted them stuck to the labels of pockets, then suppliers would need to maintain separate processes. By working together to adopt common practices, the industry can smooth the path to adoption.

Even more important, VILRI is helping the industry to move forward together. This is critical, because Walmart's experience proved that even the world's largest retailer can not adopt RFID alone. Many observers surmised that Walmart had backed away from RFID a few years ago because it had learned that there was no value in tagging pallets and cases. But I believe that's wrong. There was value for Walmart—but the problem was that it was a burden on suppliers to tag some pallets and cases for Walmart, but for no one else. The fact that no other mass-merchandise retailers moved forward meant that Walmart had to either force suppliers to do something that was costly for them, or shift gears. It smartly chose the latter option.

VICS and GS1 funded research to determine RFID's benefits for apparel retailers, which made retailers interested in the technology. Now, the organization is educating more retailers about the benefits and promoting adoption, so that the industry can move forward as a whole. In addition, VICS and the American Apparel & Footwear Association (AAFA) are funding research to determine the benefits for suppliers. The expectation is that there will be supplier benefits, which will encourage them to move forward.

Geoffrey Moore, the author of Crossing the Chasm, has postulated that when the use of a new technology reaches critical mass in a particular industry, then all who had previously ignored the technology are likely to suddenly adopt it without considering the return on investment. The U.S. retail apparel industry is now moving toward critical mass, after which the remainder of the global apparel sector will most likely follow.

Once apparel tracking is widely adopted, mass-merchandise stores such as Walmart, as well as department stores such as Macy's and JCPenney, will move on to other categories. And retailers that sell sporting goods, electronics, books and other products will likely begin adopting the technology as well.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog, the Editor's Note archive or RFID Connect.