Jul 21, 2009RFID Journal today announced that it will give away a Retail ROI Calculator at the fourth annual RFID in Fashion conference and exhibition, to be held on Aug. 12-13 at the Fashion Institute of Technology, in New York City. The interactive spreadsheet comes with supporting notes, and will enable attendees to assess their potential return on investment (ROI) from employing RFID to track apparel, footwear and accessories in stores.
"Over the past few months, we have gathered data from RFID deployments in apparel and retail around the world, and used these to build a calculator that will enable retailers to determine whether it makes sense to launch a pilot," says Mark Roberti, RFID Journal's founder and editor. "You can run what-if scenarios, then plug actual pilot numbers into the calculator to determine if a rollout would deliver an ROI."
The calculator enables retail firms to enter their average number of units on the sales floor and in the back room, as well as the average unit cost, inventory turns and retail margins. They can also enter the number of hours that staff members spend receiving goods, conducting cycle counts and replenishing product inventory. The calculator will then estimate the reduction in labor costs, based on savings achieved in deployments and pilots by such companies as American Apparel and Dillard's in the United States, and Karstadt, Galeria Kaufhof, NP Collection and others in Europe.
The calculator allows a user to estimate the potential increase in sales, based on the improved inventory accuracy and on-shelf availability that can be achieved with radio frequency identification, and enables companies to estimate hardware, software and integration costs, based on their store layout and operations. It also provides a sample case for a fictional company, based on benchmarks from real-world deployments and businesses utilizing RFID, regarding the cost of adding additional employees to improve inventory accuracy.
"Retailers have been running pilots for several years to see if RFID can deliver benefits, and we now have a great deal of evidence that it can," Roberti says. "This calculator now gives them the ability to determine the likely benefit, based on their stores and business processes, then run pilots to confirm those benefits can be achieved."
RFID in Fashion 2009 is the only event aimed at educating retailers and apparel, footwear and accessory companies about how to use RFID to improve inventory accuracy, reduce shrinkage and increase sales. The event will feature objective case studies presented by apparel, footwear and accessory retailers and suppliers that have deployed RFID in their operations. Attendees will learn how these companies are using the technology to improve in-store inventory accuracy from 65 percent to 98 percent, decrease the time required to take inventory in stores by 75 percent, reduce the time needed to receive goods into inventory by 85 percent, lower labor costs associated with markdowns by 50 percent and increase sales by as much as 15 percent
The conference is being coproduced by RFID Journal and the American Apparel & Footwear Association (AAFA), and is supported by the Vendor Compliance Federation and the Trade Promotion Management Associates. Avery Dennison is the cornerstone sponsor. The conference will feature an invitation-only Leadership Forum, in which a select group of apparel retailers will discuss issues related to the adoption of RFID technologies in that sector, and forum participants will be taken on a tour of a real RFID-enabled store.