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Signs RFID Is Nearing a Tipping Point in Apparel Retail

A number of leading indicators suggest the sector is poised to adopt radio frequency technology en masse within the next few years.
By Mark Roberti

Another sign that retail is nearing mass adoption of RFID is that suppliers are more willing to tag items, and retailers are experiencing less pushback. Speaking at RFID Journal's recent RFID in Retail and Apparel event in New York City, Bill Connell, Macy's senior VP of logistics and operations, said there is now a "much greater acceptance and greater understanding of the benefits" among suppliers, and "there is a momentum that suggests to us that we are pretty much at that tipping point."

Suppliers are beginning to discover internal benefits. A few years ago, Elie Tahari, the women's fashion company, was asked to RFID-tag the items it was shipping to Macy's. The company contacted Avery Dennison, which was supplying its apparel hangtags, and asked it to put a passive ultrahigh-frequency RFID transponder in each hangtag on items bound for Macy's. By doing so, it complied with Macy's tagging requirements, but got no benefit from the tags.

Speaking at RFID in Retail and Apparel, Nihad Aytaman, Elie Tahari's VP of information technology, explained the evolution of the company's thinking. "As we began shipping to Macy's more and more, we ended up tagging more lines," he said. "One of our partners, the COO for Tahari ASL said, 'We are spending all of this money tagging [items for Macy's]. Let's tag everything and make use of it internally.'"

Now, Tahari ASL tags items at the point of manufacture. The company decided to use RFID in three areas of its distribution centers: receiving, packing and shipping. Thus far, it has implemented the technology in the receiving area. "The speed is indisputable," Aytaman said.

The packing area is currently undergoing testing. When tagged items are being picked to ship to a Macy's store, they are put in a box and then checked with a handheld reader. The handheld screen displays any anomalies, such as an extra item or an item short. The worker at the picking area can quickly identify and resolve any issues.

Tahari ASL has already reduced the time required to receive goods into inventory at its distribution center. The company believes RFID will reduce picking and shipping errors and deliver a return on investment. Other apparel companies required to ship tagged products are following a similar course.

It is still not clear when RFID will reach the tipping point in apparel retail, but as more retailers begin using the technology, more apparel companies will tag at the source and more, like Elie Tahari, will begin tagging all items they make. As more suppliers do this, there is more reason for laggards to adopt RFID and take advantage of tags already on products they receive. And that is when RFID adoption in this sector will explode.

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