Like every other economic sector, retailers have been forced to reshape their operations due to the covid pandemic. Although there has been an uptick in in-store buying, especially during the holidays, pandemic-induced modes of shopping are now part of the new normal, especially online shopping and curb-side pickup.
Consulting firm McKinsey reports that store-located pickups have been more profitable than delivery from a central distribution center. The cost of replenishing, picking, and staging are higher with store pickups, but that cost is outweighed by the expense of last-mile home deliveries.
Brick-and-mortar stores are now playing a major role in omnichannel shopping fulfillment in the new normal. Contrary to predictions (and contrary to the retail trends leading up to 2020), storefronts are far from dead.
But competition among retailers is stronger than ever, and savvy retailers are adopting or extending RFID technology to enhance the customer “buying journey:”
- Inventory tracking – RFID automates replenishment planning and ordering, and tracks product locations through the supply and distribution chain.
- Store operations – RFID automates notifications of restocking and picking, decreases shrinkage, and enables self-checkout.
- Customer experience – Currently in limited deployment, RFID holds the potential for personalized shopping recommendations in-store and online.
According to McKinsey, when retailers commit to RFID they can expect to see profit-boosting benefits:
- A 25% improvement in inventory accuracy, preventing over-buying and stockouts.
- A 10-15% reduction in inventory labor costs.
- A reduction of shrinkage and pilferage resulting in a 1.5% increase in revenues.
RFID isn’t a one-size-fits-all proposition, however. To make sure you’re getting the best technology for your retail operation, talk to a storage solutions consultant with RFID expertise.
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