Businesses are always looking for new ways to cut down expenses and also ways in which they can reduce the time it takes to execute business operations. One way in which firms can do this is by finding new innovative ways to track inventory and sales figures. One new technological advance that can greatly improve inventory tracking and organization, is through radio frequency identification tags, or also called RFID’s. An RFID is a small microchip, which is placed on a retail item and tells the firm how many of each item it has on stock and how many have been sold. This chip greatly increases inventory accuracy and can help business’ move at a much more efficient pace.
Throughout the article, “RFID Significantly improves Item-Level Inventory Accuracy”, written by Matt McGowan, an experiment was chronicled that tested new RFID’s. Through this experiment, which was conducted at the University of Arkansas and focused on two Bloomingdale retail stores, researchers concluded that through the use of RFID’s, inventory accuracy increased by twenty seven percent. It was also concluded through this survey that in an RFID system, 4,767 retail items could be counted per hour whereas in a traditional barcode system (which most retail stores still use), only 209 retail items could be counted which. The RFID system is a 96 percent increase over the bar code system. This is a significant change, which could greatly increase the productivity of any firm that put this system into place. Through an RFID system, retailers can also have a better feel on who is buying what and which items are more popular. This allows for firms to better know which items they should stock and produce more of. This allows for retailers to possibly make more of a profit for they would not be spending money on useless items, but on things, which will actually be bought.
In my opinion, I think that this is an unbelievable accomplishment for business. The fact that retailers can now use computer chips within clothes to track shipments and inventories is incredible. If I were running a retail store, the RFID system would be one of the first things that I implemented. It greatly improves the accuracy of the inventory that is held within a retail store, it speeds up the process of counting the inventory, and it also takes away the human error, which has said to be a problem within a normal barcode system. It also may allow for firms to become more profitable and be able to expand their business because they would be much more organized. Every thing that I have read about the RFID system seems positive and I think that it is only a matter of time before all retailers implement this system. From what I have read, I would recommend this system to other people.
My article can be found at:
http://www.innovations-report.com/html/reports/economy_finances/rfid_significantly_improves_item_level_inventory_138456.html
I found this article very interesting. I was quite suprised that RFID's only increased inventory accuracy by twenty-seven percent. I assume that percentage is significant, but I would think that such an advanced way of tracking inventory would result in a a much higher accuracy after being implemented.
ReplyDeleteAnother point I would like to make is that this system can benefit both supply chain personnel as well as marketing reasearchers or thse who analyze consumer behavior. I know that Wal-mart implemented RFID's several years ago (I believe 2003). They also implement it on a larger scale. They use RFID's for tagging pallets and cases that shipments of clothing come in. Being able to quickly and electronically scan large pallets makes the jobs of supply chain managers much easier than doing so manually. This also helps in locating a pallet that was misplaced during shipment. In terms of marketing researchers, it has been considered to use RFID's for the easier tracking of purchases of certain styles, colors, and fabrics of clothing that a store sells. This assists in determing the most successful designs that a store puts out. Also, incorporating RFID tracking in dressing rooms will most likely not be uncommon in the future. This is another way for those studying consumer behavior to determine which clothing pieces gets the customers attention but does not sell as well.
The uses of RFID are probably more vast than we can imagine right now, but only time will reveal all of the applications of such technology.
The implementation of the RFID system is beneficial to the overall operations of a business, especially in retail stores. It allows a company to monitor consumer habits, track inventories and shipments and minimize theft. Furthermore, the organization and accuracy of this technology can assist in forecasting and reducing inventory, the least liquid asset, which would ultimately better the company's financial position. In terms of marketing, consumer preferences can be identified and maintained in stock to increase profits. It also cuts a company's costs by reducing the need for inventory-monitoring labor. As with the results of most database-oriented advancements, RFID technology enables enhanced business management, improved efficiency and increased customer satisfaction.
ReplyDeleteI believe that RFID's could greatly increase a companies sales on a particular item. By tracking inventory a business is able to know what is in high demand and what items people really want to buy. This gives a new business the possibility to boom and thrive by finding that one product that can really sell. It also speeds up the process of counting inventory which can make things a lot easier and requires less work, so therefore, employees will not have be payed as much for less work time. I know that Walmart is a user of the RFID's and they have one of the most complex successful computer systems in the world. Overall, this is an awesome thing and all businesses should look into getting these microscopic chips.
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