Macy’s and Bloomingdale’s are widely adopting radio frequency identification technology, or RFID, for merchandise representing about 30 percent of sales.
The parent Macy’s Inc. said Wednesday it will start the RFID rollout by the third quarter of 2012, with men’s furnishings, men’s slacks, intimate apparel, denim, women’s shoes and some private brands, and complete it by fall 2013. All 850 stores are involved.
Macy’s said it will be among the first retailers to implement RFID “aggressively, on a broad national scale.” Wal-Mart has also been utilizing RFID on some products, and several retailers are in the test mode. But after initial hype as a major advance, its take-up lost steam and many thought the technology was languishing.
After nearly two years testing RFID in select stores and distribution centers, Macy’s learned that inventory accuracy can be maintained at 97 percent or better. The technology is geared to track regularly stocked and replenished basics, rather than fashion merchandise, by counting goods on hand by size, color and style.
“RFID is a tool to better serve customers and drive sales by ensuring we have the right product in the right place at the right time,” for customers shopping any channel, said Tom Cole, chief administrative officer of Macy’s Inc. With RFID, associates can count inventory faster, more frequently and with greater precision, and can better match up customer demand to the right sizes, colors, styles and quantities. RFID also enables Macy’s to conduct multiple inventory counts during the year compared with the current practice of taking a physical inventory once a year.
RFID requires close collaboration between retailers and merchandise and technology suppliers, as well as additional expenses including RFID chips that manufacturers need to install on product tags. For retailers, equipment to read the codes and systems to manage the information is required.
Macy’s participates in the Voluntary Interindustry Commerce Solutions Association and GS1, the industry organizations that set standards for electronic data interchange.