Since 2020, Walmart has required suppliers to add RAIN RFID tags to certain categories of goods as part of an ongoing digital transformation aimed at improving efficiency. RAIN RFID is a passive, battery-free wireless technology that allows retailers to locate every tagged item quickly and accurately.
Since implementing this mandate, Walmart has seen significant improvements in inventory accuracy and, through expanded omnichannel fulfillment capabilities, has a greater ability to innovate the customer experience. As Walmart’s RFID tagging mandate evolves to include more categories of goods – the mandate began with retail apparel and has expanded to now include automotive, books, home and sporting goods, media and gaming, toys, and more – the impact of this program will reverberate across the retail landscape.
Specialty Retailers in a Unique Position to Benefit
As a specialty retailer, you may find yourself on both sides of the RFID tagging mandate. For example, if your suppliers also ship to Walmart, you may be receiving goods that are already tagged. If you are a Walmart supplier, you will need to establish a tagging program to achieve compliance.
Regardless of your position within this ecosystem, there is opportunity for you to benefit beyond retaining access to Walmart shoppers.
RFID Supports Inventory Management
Inventory management is typically the starting point for RFID adoption, but once the foundational infrastructure is in place, it is easy to continually expand the scope of implementation and returns.
For example, the inventory visibility gained from a RFID deployment can pave the way for a smoother, more streamlined shopper experience. A recent RSR and Impinj report concludes that unifying the physical and the digital worlds is crucial for positive customer experience. RSR found that 63% of shopping journeys are now beginning online, but they may not end online. Omnichannel fulfillment, like curbside pickup or buy online, pick up in-store (BOPIS), is essential but adds cost to each purchase. This requires retailers to look at optimizing processes to minimize costs. Competing with online giants (who operate with razor-thin margins) is impossible without leveraging automation and data-driven decision-making to find tech-driven efficiencies.
RFID Supports Loss Prevention
RFID also supports loss prevention programs. The National Retail Federation (NRF) concluded that “RFID is the most important technology to support loss prevention.” Knowing what is leaving, where and when allows better decisions around merchandising, replenishment, store design, labor usage and more. The data retailers derive from using RFID for loss prevention gives them an opportunity to be proactive and reflective.
The analytic tools available today can consume huge amounts of RFID-provided data quickly to make sales and marketing recommendations. Leading retailers are using RFID data to unlock a variety of predictive use cases, like understanding dead zones in the store front, forecasting demand more accurately at granular levels based on real-time trends and dynamically triggering inventory rebalancing, pricing changes or promotions when models predict local stockouts. It’s the beginning of a long value chain that is driving exciting innovations.
How to Start an RFID Tagging Program
If you’re considering how to deploy your own RFID tagging program, whether to comply with a large retailer mandate or strengthen your inventory management and ability to innovate customer experience, here are five steps to get you on a successful path:
- Seek outside expertise. Identify a third-party partner with deep expertise both in RFID technology and with your business structure.
- Define objectives and scope. Will you tag certain types of items or your whole inventory? On what timeline?
- Articulate your tagging strategy. What kind of tag (or tags) will work with your inventory? What information will you encode the tags with?
- Define a basic reading strategy. Next, decide where (manufacturing, warehouse, in-store) and how (manual handheld or autonomous fixed) you will read each item. This will depend on the specific use case and will vary from one organization to the next.
- Identify your earliest tagging opportunity. The further upstream you begin tagging items, the more opportunity for speed, efficiency and accuracy gains.
The power of RFID and its ability to generate critical data that drives innovation are taking it beyond individual retailer mandates to become an emerging industry standard with exciting potential.
Ashley Burkle is the retail business development director for Impinj, the pioneer of RAIN RFID.
