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Retail's Trilogy

A single RFID infrastructure can—and should—enable inventory, asset and identity management.
By Bill Hardgrave
Dec 13, 2013

I love the AT&T commercials that feature a guy asking a group of kindergartners a series of "which is better?" questions. In that vein, let me pose a question to you: Which is better, using an RFID infrastructure to achieve benefits from one application or from three?

Most retailers have been adopting passive, ultrahigh-frequency RFID solutions to improve inventory management. This makes sense. After all, inventory is the stuff retailers sell, and as I've discussed often in this column, improving inventory accuracy can solve many problems and enable retailers to be more competitive.

But retailers should not stop there. They should take advantage of their RFID infrastructure to improve efficiencies in two other major categories—asset management and identity management—both of which can impact their bottom line.

In a retail store, assets are generally fixtures (shelves and racks, for example) and equipment (pallet jacks and rolling clothes racks). These assets can be moved, damaged, destroyed or misplaced. As in other industries, being able to track and locate these assets in a store can improve usage rates and reduce replacement costs. (RFID Journal has published many news stories and case studies detailing how hospitals and manufacturers have deployed RFID asset-tracking solutions that delivered a return on investment within a year.) In stores, RFID could be used to answer questions such as, "Where is the pallet jack when I need it?" or "How many times did the rolling clothes rack go in and out the transition door from the back room to the sales floor?" Use your imagination—what else would you like to know about your assets?

Identity management involves knowing the location and/or identity of people. Many retailers issue low-frequency RFID identification cards to store associates for entry into facilities or rooms, or for clocking in and out. But the ID cards are limited to these applications. If store associates wore or carried ID badges embedded with UHF tags, retailers could also know, for example, who stocked which shelves. In addition, retailers could use UHF tags in customer loyalty cards to gain insight into customer traffic flow and dwell times. This information could be used to optimize store displays and product placements, making it easier for shoppers to find popular items. What else could you do to improve sales and the customer experience?

A company can gain a competitive advantage by doing something no one else is doing, or doing something better than others are doing it. I'm not aware of any retailer using RFID for inventory, asset and identity management. Thus I ask: Which is better, three benefits or one? As any kindergartner will tell you, more is better.

Bill Hardgrave is the dean of Auburn University's Harbert College of Business and the founder of the University of Arkansas' RFID Research Center. He will address other RFID adoption and business case issues in this column. Send your questions to hardgrave@auburn.edu.

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