Wall Street Journal Article on Zara’s Use of RFID

The prestigious newspaper wrote a positive article about how radio frequency identification is helping the retailer improve inventory accuracy.
Published: September 19, 2014

It’s not often the mainstream business press publishes a positive article about radio frequency identification technology, so it was nice to see the Wall Street Journal‘s piece on Zara‘s use of RFID to improve inventory accuracy (see Zara Builds Its Business Around RFID).

Here is how the article describes a benefit of the RFID solution: “One benefit was on display on a recent morning, when store manager Graciela Martín supervised inventory-taking at one of Zara’s biggest outlets in Madrid. The task previously tied up a team of 40 employees for five hours, she said. That morning she and nine other workers sailed through the job in half the time, moving from floor to floor and waving pistol-shaped scanning devices that beeped almost continuously while detecting radio signals from each rack of clothing.”

It goes on to say: “Before the chips were introduced, employees had to scan barcodes one at a time, Ms. Martín said, and these storewide inventories were performed once every six months. Because the chips save time, Zara carries out the inventories every six weeks, getting a more accurate picture of what fashions are selling well and any styles that are languishing.”

The article says that the passive ultrahigh-frequency (UHF) transponders will “help the world’s largest fashion retailer keep better track of its stock and replenish its clothing racks more quickly, said Pablo Isla, chairman and chief executive of Inditex…”

I disagree with the comment that “merchants such as Wal-Mart Stores Inc. and J.C. Penney Co. discovered that what looked good on the drawing board didn’t always work so well in warehouses and stores.” In fact, Walmart did not back off from the technology because it was failing to deliver value. And Penney’s didn’t remove anti-theft (electronic article surveillance) tags because RFID interfered with the EAS tags. My understanding is that the former CEO thought the EAS tags were ugly, and he wanted to move toward allowing shoppers to check out purchases in the aisle, via handhelds, as Apple‘s stores have done.

But these are quibbles. The article clearly highlights the benefits retailers are achieving today, and that’s a positive sign.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark’s opinions, visit the RFID Journal Blog, the Editor’s Note archive or RFID Connect.