Bloomingdale’s Item-Level RFID Study Shows a 27 Percent Inventory Accuracy Boost
Written by Evan SchumanAugust 26th, 2009
An item-level RFID pilot done with Bloomingdale's and the University of Arkansas delivered more statistics to what is already widely believed, that item-level RFID should improve inventory accuracy. But it also found a 96 percent improvement in inventory count speed, which suggests the potential for even more dramatic accuracy improvements.
In the trial—conducted over 13 weeks and published Monday (Aug. 24)—looked at a non-item-level store (the control store) and one item-level store and the same limited product area (denim jeans) were examined for both.
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3 Comments | Read Bloomingdale’s Item-Level RFID Study Shows a 27 Percent Inventory Accuracy Boost
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August 28th, 2009 at 2:38 pm
I’m thinking this shouldn’t be big news to anyone. In a closed-loop scenario, it has been well established in various industries that RFID can be very useful in improving inventory management – including inventory accuracy and cycle counts.
The first question is when, if ever, can we see such dramatic benefits in an open-loop environment on a consistent basis? The second question is “Is it necessary?”
How much did it cost – in terms of money and time – to do the tagging in this study? Was the cost low enough to create an ROI that made tagging valuable enough that a retailer would do this ON THEIR OWN? If so, this is big news as we can really focus on useful, functional, impactful RFID projects and let the open-loop challenges sort themselves out over the next decade.
If it doesn’t have an ROI that will allow retailers to do this on their own, companies will start to question whether the challenges caused by an open-loop environment (read: supplier tagged items) reduce the overall ROI enough to make retailers question implementing such programs.
August 28th, 2009 at 9:19 pm
Editor’s Note: I agree. (For what it’s worth, the lede of the story linked said that this merely added new stats “supporting what is already widely believed.”)
The significance of the item is that it was Bloomingdale’s and that almost anything cutting edge the Macys/Bloomie folks do is worth noting. And it’s not like we’ve seen a ton of true item-level actual trials in major retailers. And it’s even more rare for such a trial to get published in such detail. All in all, we thought it worth reporting.
But, yes, Bryan’s point is a good one. Deploying is a LOT different than doing a trial.
August 31st, 2009 at 12:24 pm
Perhaps I’m an idealist but I am happy to see press every time press comes out with positive results for RFID. This is in the hope that each one might add to the collective weight to either keep the RFID dream alive or to break the camel’s back for a retailer to do a test. The disheartening part is that the lead isn’t ROI–the repeated absence of cost figures quickly make the audience feel like the boy is crying wolf: until you tell me if it’s something you’re going to expand, why should I listen. If Wal-Mart and Bloomingdale’s don’t expand their RFID to every store, then why would I the retailer expect that it would make sense for me to test it out.