Shrink Analyzer Tracks Trends as RFID Tagged Goods Exit Stores

Published: February 2, 2024

The solution from Sensormatic is one of several new tools the company is offering to help retailers and brands better detect and manage loss of goods and ensure they are replenished.

Sensormatic Solutions has released new tools aimed at improving shrink management and inventory intelligence with a combination of RFID, computer vision and motion sensors.

The Shrink Analyzer loss prevention and inventory intelligence solution is aimed at loss detection and analysis, leveraging UHF RFID integrated with video analytics.

The retail technology solutions company, which displayed its new offerings at the NRF show this January, will be releasing soon a new RFID Seam Tag to be built directly into garments.

Meeting the Latest Shrink Challenges

Sensormatic already offers EAS systems, RFID-based pedestals and overhead readers, as well as related technologies, to detect items leaving a store. What Shrink Analyzer provides is greater intelligence related to the data capture in a Software as a Service (SaaS) application, says Subramanian Kunchithapatham, Sensormatic Solution’s chief technology officer.

The system is designed to take the RFID and video data and make it available “in a very easy to consume format for a retailer,” Kunchithapatham says.

Helping to Improve Store Management

In recent years, the retail industry has seen a rise in theft from stores, an issue many retailers “are blind [to] in terms of what is going out of the store. They don’t have visibility into which particular item has walked out,” Kunchithapatham says.

Since RFID readers can capture tag IDs that link to a product’s identity and SKU, that means stores can replenish the sales floor with greater speed than they could without that information.

One North American retailer has already begun deploying Shrink Analyzer to gain insight into what is leaving the store. Store managers now have analytics to make changes to improve in-store safety, while potentially apprehending the perpetrator.

Evidence for Loss Investigations

A feature of the system is that it integrates RFID data with Sensormatic’s video technology to record what is happening during the shrinkage event, providing evidential information for the retailer to potentially pursue what has been lost.

Depending on the state the store is located in, if the value of property stolen is high, this information may be used by law enforcement to investigate a crime. For instance, in California, $1,000 plus dollars in loss is investigated, and the video evidence may help build the case for prosecution.

The application is designed to provide managers with insights into each shrinkage event to help them take better preventative actions to prevent future losses as well.

Taking Preventative Action

For instance, if Friday afternoon at 4 pm the rate of shrinkage rises, store management could opt to increase security presence at that time.

The analysis can indicate what merchandise is prone to theft, or under what conditions and circumstances in the store. That means they can relocate or find greater security for specific products.

Because the solution serves as a cloud-based SaaS application, chain retailers can roll the technology out at multiple stores and then gain a wide variety of analytics around each site, product, and other variables.

The solution is also intended for smaller retailers that don’t have a large IT workforce in their organization to conduct analytics on their own, the technology company reports.

Screening out the Noise

Sensormatic provides its own readers as well as deploying third-party hardware depending on the need at each site.

It then applies its own software layer to manage data but also to filter out RF noise and captured tag reads only when items are walking out of the store.

“As the technology evolves and you get more powerful readers at the exit then the problem [around stray reads] becomes challenging,” Kunchithapatham says.

Algorithms at Work

Its software identifies only tags that are moving out of the store. The Shrink Analyzer then correlates those tag reads with videos.

“We are putting our algorithms on the top of this hardware infrastructure to solve the problem for the customers,” says Kunchithapatham. Those algorithms work on Sensormatic hardware as well as with hardware from third-party suppliers. “We do make readers and tags but we are not the only player, we also work with other readers,”.

An additional feature offered by Sensormatic is metal foil detection used at store entrances to identify if somebody enters with a metal foil that can be used to shield RF transmissions.

Specialized Tag for Garment Integration

Sensormatic will soon be releasing a new UHF RFID tag known as the RFID Seam Tag. It is long and narrow (measuring 98 by 6 millimeters) to be built directly into a garment. Clothing manufacturers can sew the tag into a seam or hem, making it hard to detect or remove, for a more discreet way of tracking a high value product for retailers.

The company also offers a solution called Shopper Insights that tracks shopper traffic into and around a store to capture data such as which entrance gets how much of traffic, at what time, and how sales correspond.

“We can tell you what happened in a day,” Kunchithapatham says, at one site or multiple sites, he says, based on traffic flow, hotspots, dwell times and resulting sales.

Yet another tool is a media display that can be integrated into the RFID reader port. The display video can attract more traffic to come into the store, the brand says.

Key Takeaways:
  • Sensormatic’s Shrink Analyzer tool is being piloted to provide analytics about when, where and how specific products are being stolen from stores.
  • The loss-prevention technology company has also released a new RFID tag designed for discrete integration into garment seams.