Oct 27, 2010Over the next two months, three apparel retailers will begin testing an RFID-enhanced electronic article surveillance (EAS) hard tag provided by Toronto-based EAS technology firm Retailers Advantage. The system employs EPC Gen 2 RFID inlays and readers to reduce shrinkage, by tracking when EAS hard tags are removed from products being sold in a store.
EAS hard tags are encased in tough plastic, and lock onto items—usually apparel—by means of a steel pin. An employee can utilize a special device to detach an EAS hard tag from a product prior to a consumer taking that item out of a store; otherwise, an alarm will sound when the hard tag is detected at the door. Through RFID technology, the quantity of hard tags removed from a product can be measured, and if that amount is inconsistent with the number of sales, a store's management can investigate further, tracing the cause back to a specific worker. The RFID-enhanced system can also be used to track a specific item's location within a store, as long as the necessary RFID reader infrastructure is installed.
Retailers Advantage sells a variety of EAS hard tags, labels and hardware, including those manufactured by Checkpoint Systems. Since February 2009, the technology firm has been selling non-RFID versions of its a3tag hard tag, which employs acousto-magnetic (AM) or 8.2 MHz radio frequency (RF) EAS technology. Non-RFID a3tags are currently deployed by stores throughout North America and Europe, says Sheila Barry, Retailers Advantage's president. All stores utilizing the non-RFID version, as well as those three stores preparing to use the RFID-enhanced hard tag, have asked to remain unnamed.
All a3tag hard tags provide greater security than typical EAS systems, Barry reports, because they come with a locking mechanism that has a pulling strength (the amount of force required to break the mechanism and thereby remove the hard tag) three times that of other EAS hard tags. However, she notes, they can not necessarily address shrinkage as a result of theft from staff members. In this case, for example, an employee could use a device called a detacher to remove hard tags from unpaid-for merchandise, and then take those items herself, or include them in a stack of other goods sold to a friend. While stores lose a large amount of merchandise this way, Barry says, it can be very difficult to track when and how particular items went missing, as well as which employee was responsible.
To address this problem, the company developed the Intelligent a3tag, which contains a passive UHF EPC Gen 2 UPM Raflatac Web inlay with an Impinj Monza 3 chip and two antennas—one for near-field (short-range) communication with an RFID interrogator, the other for far-field (long-range) communication. Another key component of the Intelligent a3tag system is a version of Retailers Advantage's Multi-Lock Power Detacher (MLPD) with a built-in UHF RFID interrogator, designed to read the Intelligent a3tag's RFID inlay at short range when a member of a retailer's staff uses the MLPD to remove the hard tag. The system also includes Retailers Advantage's Multilock Smart Reader software, developed by Freedom Shopping Inc., which interprets and stores data regarding each tag read. If a store sets the software to track individual items, rather than to simply count tags, it can also know which item has gone missing—and when that occurred. The store can then check its employee records to determine which personnel were working at the counter at the time of the potential theft.
Three retailers—two located in Canada, and a third in the United Kingdom—are preparing to begin using the Intelligent a3tags in the coming months for three- or six-month pilots, in order to assess the solution's effectiveness. In the case of one Canadian retailer, the system will be used only for counting hard-tag removals. The detacher will read an Intelligent a3tag's RFID inlay at the point of sale, when it comes within several centimeters of the hard tag. The interrogator in the detacher captures the unique ID number of the hard tag's RFID inlay, and transmits that number, along with a time and date stamp, to the Retailers Advantage software. The software then stores each event for every ID, and provides a total number of hard-tag removals, based on the number of different RFID inlays read by the detacher's reader. The store's management can then compare the quantity of hard-tag removals against the total sales. Initially, the store will use the Intelligent a3tag only on items of high value—for instance, on goods costing more than $50 apiece. The retailer intends to test the system in five stores, and has acquired and installed the detacher RFID reader hardware at one of those stores thus far.
In the case of the third retailer (a U.K.-based department store), the software will also be used in a manner similar to that of the Canadian jeans retailer, tracking items by linking the ID number encoded to a hard tag's RFID inlay to data about the garment to which it is attached. In this case, the store will also take advantage of the Intelligent a3tag's far-field (long-range) RFID functionality. The store will use handheld RFID interrogators to read the Intelligent a3tag's RFID inlay when the EAS hard tag is first attached to an item in the back room, and then again on the sales floor, for the purpose of taking inventory. Initially, the store is attaching Intelligent a3tags only to garments in one of its departments, where it also plans to install fixed EPC Gen 2 UHF RFID readers, to track when an article of clothing is placed on the sales floor, and when it is taken out of that department.
Barry predicts that for end users, a return on investment in the hardware, software and installation will be achieved in three to six months. In the near future, she adds, it is likely that several of the company's other customers using its non-RFID a3tag EAS hard tags would begin testing the Intelligent version, along with UHF readers.
Joshua Bamfield, the director of the Centre for Retail Research, in England, and the author of the annual Global Retail Theft Barometer, says that the 2010 edition of that report "confirms previous findings that U.S. retailers perceive dishonest employees as being a far greater problem than shoplifting." Employees, he adds, are responsible for 43.7 percent of shrinkage, totaling $17.2 billion. "What is unknown, of course, is the extent to which employee theft involves collusion with shoplifters, or acting with groups to rob retail businesses."
Retailers Advantage is not the first company to offer hard tags or security labels combining traditional EAS technology with radio frequency identification. In 2007, Checkpoint Systems unveiled labels incorporating an 8.2 MHz RF antitheft inlay and an EPC Gen 2 RFID inlay (see Checkpoint Combines EAS Tags With RFID). And in 2008, LC Waikiki, a clothing retailer operating in Eastern Europe, rolled out a system involving hard tags that combines EPC Gen 2 RFID and acousto-magnetic EAS technologies (see Turkish Retailer Uses Hybrid EAS-RFID Tags to Stop Theft, Improve Inventory Management).
Alan Sherman, Checkpoint Systems' director of marketing for merchandise visibility solutions, sees value in the growing number of RFID anti-theft applications, such as this one, for the retail market. "We are beginning to see more retailers looking at the confluence of the visibility that RFID provides," he states, "to optimize inventory and enhance loss-prevention capabilities. This is an exciting opportunity for retailers to gain multiple benefits."
