Retailers are finding new ways to use RFID to boost their bottom line, according to a report by the UK’s University of Leicester and the ECR Retail Loss Group and supported by New Jersey-based Checkpoint Systems.

The research report reveals the innovative ways retailers are using RFID technology in-store to improve profitability. Authored by Adrian Beck, an emeritus professor from the University of Leicester, it highlights how companies are employing the technology for a broader range of purposes. It demonstrates the value the technology is bringing to their businesses and, ultimately, the impact it is delivering to their bottom line.

Crucially, it also shows that more retailers than ever are recognising the benefits of RFID and driving uptake within their organisations.

The report claims that as businesses are becoming more established in their use of RFID-generated data, they are gradually incorporating more use cases into their business-as-usual practices.

In particular, more retailers reported using RFID to streamline the audit process as an alternative to infrequent organisational stock takes, which not only delivers cost savings, but also provides more regular insights into the status of inventories.

It also found that using RFID was having a significant impact on store processes. While RFID has always been key to inventory accuracy, some companies are now using these data to improve business activities such as reducing phantom out of stocks, improving rapid stock search-and-find tasks, and developing an efficient ship from store capability.

Beyond the more traditional retail model, RFID was seen as a key facilitator in delivering omnichannel retailing by all those questioned.

Without the inventory accuracy offered by RFID, few retailers believed they could reliably use their stores as fulfilment centres to output online orders. Indeed, one retailer admitted only to making RFID-enabled store stock available for this purpose. The use of RFID to improve online order accuracy is also becoming more commonplace, to reduce errors in the picking and packing process, therefore improving customer satisfaction. One retailer reported a 90% reduction in incorrect orders and customer complaints since introducing RFID into the process.

Looking to the future, one area where the benefits of RFID are starting to be tested is self-checkouts. While limited due to the need to have a 100% SKU tagging strategy in place, retailers are starting to recognise the benefits the technology could offer including increased speed of checkout, reduced likelihood of double scanning and thereby improved customer service.

Another area where retailers also reported reaping the benefits of RFID was loss prevention. While none of those interviewed argued that reducing loss was the primary reason for investing in RFID, many acknowledged they were benefiting from it by using the technology to tackle refund frauds, enable dynamic loss product profiling, manage e-frauds and identify stolen products.

“Previous research has shown that in the appropriate retail context, RFID technologies can deliver clear-cut benefits in terms of inventory accuracy and the provision of valuable data,” said Beck. “In this study we wanted to find out how its use evolved over time – understand what innovation looks like as well as delve into the benefits and limitations of the technology. While some retailers are certainly pushing the boundaries when it comes to RFID usage, others have adopted a much more incremental and gradual approach to its application.”

Mariano Tudela, vice president for Checkpoint Systems in Europe, added: “It is great to hear that companies are looking beyond the traditional benefits of RFID to find new and innovative ways to use the technology and it will be very interesting to see how this develops over the coming years. One of the key evolutions for RFID recently has been in omnichannel retailing and, particularly following the Covid-19 pandemic, it is an area that we expect to see taking off in the future. RFID technology is the only way to ensure a successful omnichannel strategy, and retailers that don’t adapt their offering are likely to be left behind.”

A division of CCL Industries, Checkpoint Systems is a vertically integrated RF and RFID provider for retail. Through software, hardware, labels, tags and connected cloud-based products, Checkpoint optimises retail operations and efficiencies with real-time intuitive data delivered throughout the supply chain and in-store resulting in improved profitability and a better consumer experience.

CCL Industries specialises in label and packaging for global corporations, small businesses and consumers. It employs approximately 19,000 people and operates 150 facilities in 25 countries on six continents with corporate offices in Toronto, Canada, and Framingham, Massachusetts.