As the retail industry has learned over the past three plus years, maintaining a strong supply chain is risky. Retailers need to ensure shoppers can always get the products they want, where they want them, or they risk losing loyalty. Perry Ellis is addressing this challenge with RFID technology that will help retailers manage their supply chains from the store level all the way through to broader inventory planning.
About 95 percent of Perry Ellis products are RFID-tagged before they leave the manufacturing facility. The advanced RFID functionality has been implemented in 40 stores, and the retailer is rolling it out to the global chain. Due to the small size of the pilot stores, the technology worked quickly. It is reported that between 1,500 and 3,000 square feet, inventory needs to be carefully sorted between the front desk and the back room, and each store needs to have a clear understanding of inventory to ensure that customers are not disappointed by out-of-stock.
Sandeep Baghel, vice president of information systems at Perry Ellis, said in an interview that when selling any product, our built-in integration with the store platform uses the RFID system to tell us what’s in the inventory so it knows if it’s missing.
In addition, the use of RFID will help Perry Ellis better and more granular understanding of which products are sold in which stores. Knowing that a certain SKU is a top seller in a certain location is one thing, but knowing the exact sizes and colors that drive those sales can take sales to the next level.
Baghel said that if you look purely at the sheer physical inventory, we don’t have a huge difference — less than 2%, but if you look at the size, there’s a big difference. That means we’re missing opportunities in stores because we don’t have the right scale and replenishment is driven by the business’s objective sense of the system. If our store messes up the sizing for any reason, we will not be able to fix it properly and it will not be sold properly. As planned, once all hardware and software is deployed in all 40 stores, we will sync our corporate inventory with whatever the RFID shows, so that the planning team has accurate inventory data to make better decisions.
Having items with RFID tags also increases shipping efficiency at all times and provides customers with a great shopping experience at all times. A traditional example is tethering RFID to employees’ mobile phones, allowing them to efficiently find the right size, color, or other option to reduce customer wait time. However, RFID can also be used to eliminate frictional incidents that can occur throughout the consumer experience, such as checking out lines.
Baghel said that using traditional methods, only one barcode can be scanned at a time, but after deploying RFID, if someone buys 10 items, I can just wave the RFID reader in front of them and scan all the items at the same time. Increased productivity.
While RFID technology has historically been criticized for being expensive, Baghel believes that as adoption grows, it will become affordable and by necessity. The proper use of RFID, both in-store and across the supply chain, will set the standard for customer expectations for years to come.
The cost of RFID has been falling in recent years, making it more reasonable for retailers to use it, Baghel said. Big retailers like Wal-Mart and Target are using RFID, and they’re also requiring suppliers to use RFID tags, too. As the quantity increases, the cost of using these RFID tags will gradually decrease. This also means that for any other retailer, it is very important to know the exact inventory and its location. I believe that with RFID investments, the potential is limitless.
Post time: May-26-2023