Aug 26, 2018Fashion retailer Superdry is rolling out RFID technology across dozens of its stores throughout the United Kingdom and United States this year, following a five-store pilot that found UHF RFID technology improved sales while boosting inventory accuracy and reducing out-of-stocks. The solution, provided by Tyco Retail Solutions, consists of TrueVUE software to manage read data, Zebra Technologies handheld RFID readers and Avery Dennison label printers. The long-term plan is to build RFID technology into all of its global stores.
Superdry was created in the United Kingdom in 2003 and now has stores across the U.K. and Europe, as well as in the United States. Its garment brands include vintage Americana styles with Japanese-inspired graphics. The company is growing and has a culture of embracing new technologies intended to help that growth, especially those that can help link digital and brick-and-mortar store sales. E-commerce sales have been on the rise for the company, with a 25.8 percent increase in sales driven by e-commerce in the past year.
To ensure inventory accuracy, enabling both digital and physical onsite sales, the company strives to have every size of each product on display at each store. However, manual inventory counts were typically conducted only once every six months.
"As a business," says James Eastwood, Superdry's implementation manager, "we've realized that fusion of the digital world and brick-and-mortar stores is going to be critical to success in the high street market." E-commerce is requiring ever greater inventory accuracy as services enable consumers to select from products that are available within their immediate vicinity, for instance, which requires the kind of inventory accuracy that RFID provides.
Superdry wanted to pilot RFID technology not only to make inventory tracking more accurate and automatic, but also to enable further technology-based implementations in the future, such as smart mirrors in fitting rooms. When it comes to adopting technology or other innovation, Eastwood says, the company doesn't spend excessive amounts of time in planning. The company, located in Cheltenham, England, opted to launch an EPC UHF RFID pilot during the peak season of last year, then began deploying RFID at five stores—as well as at its distribution center—between December 2017 and February of this year.
The company selected five pilot locations. The participating stores needed to represent the variety of business sizes and merchandising selections across its enterprise. Therefore, RFID was deployed at its Regence Street flagship store, as well as at a much smaller store connected to its offices in Cheltenham, and its Redding-based Store of the Future. They held tagging parties at each of the five locations, and also tagged outbound products to those five stores at the DC.
During the pilot, employees at the DC fulfilled orders from each store, printing UHF RFID labels with an Avery Dennison printer for each product. The unique ID number encoded on every label was linked with a specific product's stock-keeping unit (SKU) in the TrueVUE software.
Once the goods arrived at the store, sales personnel used Zebra handheld readers and Apple iPods. The readers captured the tag IDs of each product being received and forwarded that data to the iPods, and then to the TrueVUE software via the store's Wi-Fi network. When the goods were placed in the store front, the tags were read again in order to update each item's status. Management at each store, as well as at the headquarters, could view which products were on display and which were in the back room at each location.
When a product was sold, its status was updated in the ERP system and was then shared with the TrueVUE software to create a record in both pieces of software. That sales data could prompt replenishment orders to the distribution center
With RFID use, Eastwood says, sales revenue was up at all five pilot stores, though he declines to indicate specifically how much, or what percentage could be attributed to RFID. "Across five stores," he says, "it's very difficult to attribute sales lifts to a specific technology," while trends may be easier to identify with the added data coming from more store deployments. At this point, Eastwood adds, "We're very confident that there is a sales lift that is due to the increased availability provided by RFID."
The amount of labor time required to receive goods at the store was also decreased with the use of RFID. Audit counts proved to be faster, and thus could be conducted more often. They could also conduct perpetual inventory checks, by setting the TrueVUE software to seek a specific product type and count those items in the store's front and back rooms. Based on the pilot's results, Superdry intends to take all of its stores live, initially with 27 additional locations in the United Kingdom that represent approximately 45 percent of U.K. sales, as well as all U.S. stores. The five piloting stores are continuing their use of the technology.
During a subsequent rollout phase, Eastwood says, Superdry plans to expand the solution's use to the other U.K. stores, as well as to those throughout Europe. The retailer plans to move fast—the first phase of the rollout should be completed before the high sales season expected to begin in late 2018. "The initial plan was to take the next eight months to define a clear, robust solution," he explains, but the company found that eight-month review period to be unnecessary. "We wanted to accelerate before the peak season this year."
The tags are now being applied at the point of manufacture. Sometime within the next year, stores will begin receiving those products tagged at source. The company also plans to deploy RFID readers at all three of its distribution centers (in addition to the U.K. warehouse, there is one in Belgium and another in the United States), with the potential to install tunnel readers to capture outbound tags as products are shipped to stores, thereby saving labor time at the DC.
With RFID, Eastwood says, the company expects not only to have better stock accuracy, and thus more sales, but also to be prepared for other applications such as security or fitting room solutions. It could also link with a VIP system that might employ Bluetooth Low Energy (BLE) and app-using customers to identify who has entered the store and what products they carry around the premises or are looking at.
The system will enable analytics as well, such as viewing how long products remain on display in specific stores. "It allows us to see what goods are performing well or badly," he says, which allows them to create planograms suited for each store and its customers. The RFID system could also save the cost of moving items from one store to another, or to outlet stores, by providing a clear picture of where products are, how quickly they are selling and when they need to be replenished.
Anecdotally, Eastwood says, the stores are achieving a benefit in customer service as well. He cites an incident in which a young customer from Ireland entered a Manchester store in need of a hoodie, having lost his on a flight to the area to attend a football game. The hoodie he needed couldn't be found, but with the RFID system, sales personnel put the handheld readers in Geiger counter mode and located the item misplaced in the women's department. That discovery led to a sale that would have otherwise been lost.