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Macy's to RFID-Tag 100 Percent of Items

Speaking at last week's RFID in Retail and Apparel conference, Bill Connell, the company's SVP of logistics and operations, said Macy's aim is to have all items RFID-tagged at the source by the end of 2017.
By Mark Roberti
Oct 12, 2016

Speaking at RFID Journal's second annual RFID in Retail and Apparel conference and exhibition, held last week in New York City, Bill Connell, Macy's senior VP of logistics and operations, revealed that his company plans to have 100 percent of all items in every store tagged by the end of 2017. To achieve this goal, the retailer is asking all of its product vendors to supply merchandise already fitted with passive ultrahigh-frequency (UHF) RFID tags based on the EPC Gen 2 standard.

"We still have a lot of work to do with our suppliers to get that joint commitment to apply tags at source," Connell said. "But we are fully prepped and continue to expand [our use of RFID]. We are now moving into additional use cases that are enabled because of RFID and, equally important—because of the availability of accurate information—on a very quick basis."

Bill Connell, Macy's SVP of logistics and operations
In 2015, Macy's announced that it was expanding its RFID-tagging deployment to all lines of businesses at its stores, except for jewelry and cosmetics. These two categories were not a focus since there were challenges finding tags that worked effectively and would not negatively impact the items' presentation. "We are now working with GS1 and others to find solutions [for these categories]," Connell said, "both in the technology and the presentation techniques to bring those categories of business into the fold as well." However, he noted, there is a chance that Macy's will not be able to resolve those issues in time to meet the end-of-2017 goal.

By the end of this year or the start of 2017, Connell told attendees, more than 60 percent of all goods at most of Macy's stores will be RFID-tagged and cycle-counted monthly via handheld RFID readers. Macy's had published the tagging requirement in its vendor standards manual, he said. Now, the retailer is working with suppliers to get them to tag merchandise at its source.

There is a "much greater acceptance and greater understanding of the benefits" among suppliers, Connell explained. "There is a momentum that suggests to us that we are pretty much at that tipping point."

According to Connell, Macy's has been expanding steadily into categories beyond apparel, and has found that the technology delivers value throughout its stores. "We're finding that in home [products], it has a great deal of applicability," he said. "In areas where there are samples, like tabletop, those are further expansions."

Replenishing more effectively was the use case that got Macy's involved in RFID, Connell told the audience, but the company also found additional benefits, as many experts had suggested. "You find this natural ability to expand and do additional things that have a big impact on sales and profitability," he said. "And, I assure you, we track, through control testing and so forth, our performance in these categories quite consistently. We have been quite pleased with the results, both operationally and from a financial perspective."

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