Services Operations at DecisionPoint Systems, Inc.
Retailers already have their own challenges when it comes to fashion. Fashion is a perishable commodity because all of the trends seem to change overnight. It must be difficult for retailers to predict the duration and demand of whatever “fashionable” product they are selling. Ordering too much product will create increased capital expenses and negatively effect the retailer’s bottom line, but ordering too little can translate into missed opportunities of sales. Other retailers do not really have to worry about this. Their products, in general, stay in one spot. People either want it or they don’t. But clothes… clothes are all over the place in stores! People grab the clothes they want, take it to the dressing room and then decide if they want it or not. Then there is always the possibility that people will decide at the very last second not to buy. What a nightmare! But no one is innocent! I admit that I have done this on occasion too, but actions like these cause a false out of stock situation and a possible lost sale when another person wants an item that you misplaced. Keeping an accurate inventory seems nearly impossible, not to mention very costly, because let’s face it, the idea of taking clothes and trying them on before you buy it is never going to change. Just to help you visualize this a bit, the Harvard Business School did a study and found that 8% of all retail items are seen as out of stock at any given time, costing the top 100 retailers to lose about $69 billion annually! Yikes!
So how can fashion retailers be put at ease so they stop pulling all their hair out? RFID of course! Using RFID, fashion retailers can see real time inventory. Now this does not fix all the struggles that fashion retailers have to go through, but it does help with many aspects of inventory management without putting much effort into it. Using an RFID handheld device equipped with an RFID reader can easily take a complete inventory in a matter minutes. Being able to take real time inventory can be a tremendous help when it comes to seasonal products or products with a short shelf life. Fashion retailers would be able to take inventory on the premises to see what is in the store right then and there. This eliminates lost sales due to the inability to locate store merchandise, and by knowing how much inventory they have, fashion retailers will know when it is time to order new more products and make a more accurate judgement about how much should be ordered. When RFID tags are placed on each item at the point of being manufactured, orders can also easily be tracked all the way through the supply chain, making order processing at the distribution level all the more efficient. Knowing where all the merchandise is at all times not only protects profitability, but it also increases sales!