Oct 13, 2010Zander Livingston, an RFID evangelist who spearheaded efforts by American Apparel to employ passive EPC Gen 2 RFID tags and readers to expedite the company's operations, has launched his own RFID software firm, known as Truecount Corp.
Having served as American Apparel's director of RFID until March of this year, Livingston knows firsthand how to attach tags to garments, thread Ethernet cable through walls, run power lines and install RFID antennas. He also knows what to do if an RFID system initially fails to provide the accuracy or data required. What's more, he discovered that existing RFID software packages could leave many needs of a retailer unmet, thus forcing a company to perform its own customization.
So in June, Livingston, together with software industry executive Jordan Lampert and enterprise-software architect Paresh Yadav, cofounded Truecount to provide an RFID software package that could address retailers' needs (as opposed to basic systems developed primarily for tagging cartons and pallets), and that could operate with any model of EPC Gen 2 ultrahigh-frequency (UHF) RFID tags and readers, as well as most enterprise resource planning (ERP) and point-of-sale (POS) systems. Since its establishment, the company has begun building a software platform to be piloted in at least two stores of an unnamed U.S. retailer. According to Livingston, Truecount expects to have the pilots in place by the end of 2010, and will announce the results soon thereafter.
Livingston worked for three years at American Apparel, helping to establish an RFID system at some of its stores (see American Apparel Makes a Bold Fashion Statement With RFID, American Apparel Expands RFID to Additional Stores and RFID Delivers Benefits for American Apparel). From his experience at that company, he says, he learned what challenges retailers face when installing an RFID system, including the high cost of hardware and software, as well as integration and customization.
After leaving American Apparel, Livingston began providing consulting services to other retailers, but says he found a shortage of software companies he could recommend to his clients. Most RFID software packages required customization, he explains, whether used for inventory management or security, or at the point of sale. In addition, he says, most software was provided by small firms with names the retailers didn't recognize—which gave them pause. "When you're introducing a big company [retailer] to a small software development shop, the retailer's initial response is no," he states, noting that the out-of-the-box solutions (software packages intended to be complete, with no necessary plug-ins or expansion packages) often required work. "A lot of out-of-the-box solutions are homogenized to address another need [such as tracking goods through supply chain]." They require additional customization to be used by the retailer—and that, he says, can be expensive.
According to Livingston, the design of Truecount's product—currently known simply as Truecount Retail Solutions—is based on his learnings from American Apparel, as well as his three-week consulting experience. "I took my understanding of the core elements of item-level management and added nuances," he states. For example, as an end user of RFID technology, he saw how cross-reads could create problems for a retailer. Cross-reads occur when an RFID interrogator reads tags in the general vicinity, instead of solely those that a retailer is trying to read. If a security gate were designed with RFID readers set to be highly sensitive, in order to read small tags on high-value items like jewelry, for instance, there could be cross-reads with other products not passing through a security gate, but simply located near it. "We could mess with the power of the antenna, but then you have a problem with performance."
Such cross-reading issues can be better addressed, Livingston says, by instructing the software to identify tags' distance and movement, in order to calculate when an item passes through a security portal. In that way, he explains, the software can differentiate between a tag passing through the gate and a tag within the store that is simply located near the reader.
Another challenge that the Truecount software will address is how to replace a missing RFID tag. "The tag is as important as the item it's attached to," Livingston says, since it connects to all information regarding that item—its brand, size and stock-keeping unit (SKU), for example. Simply printing a new tag and attaching it to a product works for paper price tags, but not in the case of RFID. Therefore, Truecount has included a function in its software enabling a new tag to be created, unlinking the item data from the previous tag and linking that information to the new one. At American Apparel, he says, "I saw everything that could happen, and I took that to our developers and said, 'These are the obstacles retailers face.'"
Livingston speculates that the timing is good for Truecount's product launch, as he sees a growing number of large retailers announcing their use of RFID, more product manufacturers tagging merchandise before it is shipped, and the cost of RFID hardware dropping. "I've seen tags that are priced 60 percent less than they were three years ago, when I was with American Apparel," he says. What's more, he expects to see more RFID tags built into mobile phones in the coming years, leading to other marketing options for stores that could then use the technology to read the tag in a customer's phone, thereby allowing a retailer to identify that shopper as one of its regular customers, and enabling the firm to then send appropriate price-reduction announcements or coupons via that person's phone as he or she passes a store or department.
