Jun 13, 2012Impinj, a provider of EPC Gen 2 ultrahigh-frequency (UHF) RFID tag and reader chips, has unveiled a new Store Performance Simulator (SPS), a Web-based analysis tool designed to enable retailers considering the deployment of RFID technology to perform what-if scenarios. Impinj expects the tool will help retailers better understand how radio frequency identification can increase inventory accuracy, and how such an improvement could impact a store's profitability.
The simulator has more than 25 inputs that a retailer can customize in order to reflect its own store, or specific category within the store, and allows the company to compare various scenarios. For instance, a store could compare the use of RFID against the baseline (doing nothing new), or against utilizing additional labor to manage inventory. The trial version of SPS enables a user to load prebuilt scenarios and then change some of the input parameters. Impinj is also releasing a professional edition allowing users to edit and save new scenarios in which all inputs can be controlled.
To obtain the professional version, retailers must contact Impinj. A firm wishing to create new scenarios will need to work with the chipmaker to understand how the tool handles certain inputs, or to amend the simulations so as to reflect what that company is attempting to simulate.
In addition, Impinj is releasing a white paper, titled "Fast Track to Profits: Using Simulation to Improve Store Operations," that describes the benefits of store simulation, as well as how the SPS predicts the impact on performance and profits from changes made to store operations. It also details a case study involving an unnamed retailer with which Impinj collaborated.
"We worked with a retailer that was trying to improve on-shelf availability without using RFID," explains Larry Arnstein, Impinj's VP of business development. "They were looking at making some changes with respect to training, taking more frequent inventory counts and just trying harder to keep stuff on the shelf. We modeled their processes, and the predictions from the tool reflected their results. There was an improvement in sales, but the project team concluded that you can do better with RFID, and the process is not sustainable without RFID."
The calculator is designed to allow a retailers to enter inputs that they know about their business, such as transaction rates, foot traffic, labor devoted to customer service and so forth. When a user clicks "Compare," the tool simulates store activity for a year, projecting the impact on a variety of outputs, such as store profit, unit sales, and front- and back-store inventory accuracy.
"This is not an RFID tool; it's a store-operations tool," Arnstein says. "You can see what happens if you add more labor for inventory management or shorten your supply chain. It accounts for tag costs, but not the capital cost of software and hardware. Once retailers see the impact on their business, they can easily calculate whether the investment is worthwhile or not."
To access the Store Performance Simulator, watch a short video about how to use it, or register for a July 11 webinar explaining this new analysis tool, retailers can visit sps.impinj.com.
