What is the replenishment Feature?

Replenishment is a key feature of the Detego platform for retail stores. Via the mobile application, it guides staff through the process by determining what items need to be replenished on the sales floor, by comparing the salesfloor stock to either a ruleset or a planogram. Staff then go through the replenishment process moving items to the sales floor and confirming the transfer by swiping on the mobile app. This feature increases the OFA (on floor availability) of products in the store, and the application displays the exact OFA as a percentage.

Detego Replenishment

What problem does it solve?

Not finding the right product in the right size is a pain point all too common when shopping in stores. How many times have you not purchased something from a store simply because it wasn’t available, or you couldn’t find it in your size? Use of the Detego replenishment feature improves the availability of products in stores to over 95%. Product availability means having at least one of each product on the sales floor ready to purchase at all times – down to each specific size and colour. So, this means that customers looking for a particular product have at least a 95% chance of finding what they’re looking for, increasing both sales and customer satisfaction.

All stores will have processes for replenishment. It’s a core operational function for retailers that’s vital to maintain sales and keep stores running. Like many operational processes, however, there is great variance in how effective a stores replenishment might be. The two key factors to look at are the accuracy and the timeliness of replenishment. If stock information is incorrect, then any replenishment list created from it will be inaccurate, meaning items that aren’t available on the sales floor are not replenished and therefore can’t be sold. Similarly, if items aren’t replenished in a timely manner, then they will be unavailable to purchase even though they are sat in the backroom of the very same store!

How does replenishment work with the Detego platform?

The Detego platform delivers reliable and accurate replenishment through the use of the Detego mobile application and goes hand-in-hand with the application’s stocktake feature. With the 99% accurate view of both the backroom and the salesfloor achieved by performing daily stocktakes, the Detego replenishment feature compares the inventory on the sales floor to either the store’s planograms or the ruleset of inventory for the store. It then lists all the products that need to be replenished from the backroom on to the salesfloor – providing staff with a pick list. Stores may also have additional capabilities for replenishment depending on which features they have enabled.

Let’s explore the different options for replenishment with the Detego platform:

 ‘Standard Replenishment’: Replenishing after a full stocktake

After an associate completes a full RFID stocktake, the Detego platform has an accurate view of the items on the sales floor and in the backrooms. It then creates replenishment advice to ensure that products either out-of-stock or running low on the sales floor are moved there from the backroom to maintain a high On-Floor Availability (OFA).

  1. The Detego platform uses the results of the latest stocktake and creates a list of items that need replenishing from the backroom to the sales floor.
  2. Staff use a hand-held reader with the mobile app to see the replenishment advice.
  3. As staff move an item to the sales floor, they confirm the transfer by swiping on the mobile app.
Detego Replenishment Screenshots

Replenishing sold goods – ‘intraday replenishment’

With an integrated Point of Sales (POS) system, the Detego platform can update the replenishment advice whenever an item is sold. This ensures that the item is replaced on the sales floor if there is stock available in a backroom.

  1. When an item is sold, the Detego platform checks if that product is now out-of-stock or below the set thresholds.
  2. If this is true, a notification about the need to replenish the article is sent.
  3. Staff use a hand-held reader with the mobile app to see the replenishment advice.
  4. As staff move an item to the sales floor, they confirm the transfer by swiping on the mobile app.

Additional ‘smart’ replenishment features:

Smart Replenishment: AI Picklists

For larger stores, the Detego platform takes replenishment advice to the next level.  The system utilises the RFID tags on every product alongside machine learning algorithms to can determine the relative location of items in the backroom. It then presents the replenishment list to staff in a particular order, grouping items that are near each other in the backroom. The result is that staff picking items to be replenished save time and energy thanks to intelligent assistance from the mobile app.

Read more on Smart Replenishment with AI pick paths here

AI Pick Lists

AI planograms

So, replenishment work by comparing the stock that is on the sales floor to a list or ruleset that determines what should be there. But where do these lists or rules come from, and is there room for improvement? Typically, stores will either have a basic ruleset for all stock, or more complex planograms for specific items. While rulesets are simple, they are sometimes suboptimal, but planograms for individual products are hard to maintain. With the Detego platform, stores can run Artificial Intelligence planograms which constantly learn and adapt what the optimal quantities and size distribution is for every single product in the store

Read more on AI planograms here

AI Planograms - Merchandising

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Book an online demo with us today:

As part of both the new FastTrack and the Customer Success co-sponsorship programmes, Detego will work alongside Microsoft to develop further AI and big data features to their leading RFID platform.
COVID-19 has caused massive disruption to retail. So, what do retailers need to do to not only survive, but to excel in this new normal environment?
Watch the latest episode the Retail Corner Podcast, where Detego's executive chairman, Kim Berknov, joins a panel of industry experts to discuss a growing trend in retail: the pop-up store. 

1- Adapting to the digital-first world

COVID-19 caused a huge increase in the role digital technology plays in our lives. Even for the already tech-savvy, work habits, social lives, exercise, and entertainment were all transformed into digital-first activities. Many of these trends existed before, but the pandemic accelerated this change by forcing many people to rely on digital channels and services more than ever.

The same is true for retail – online shopping and social media marketing are not new but have grown exponentially in the new normal, as customers stay at home and spend more time online. This means that, for all retail industries bar perhaps food, online channels have taken centre stage.

More than ever, customers are not only buying online, but they are also shopping online. What’s the difference? If we think of buying as the purchasing of a product, where the price is the primary factor, shopping is everything else – the experience, and the browsing and sampling of products, and ultimately the purchase decision itself. Traditionally e-commerce has always great for the former, but for actually browsing and discovering products its never been as good as in real-life. This is changing though, with digital technology like augmented reality (AR) allowing the customer to virtually try on products or see what they look like in true-to-life scale.

So, to adapt to this increasingly digital way of shopping Multichannel retailers or even pure-play brick and mortar retailers need to make more of an effort to reach their customers online. In the new normal, online is the focal point of the journey.

A webshop is one thing, but retailers need to make more of an effort to reach and meet their customers online. This means not only bringing products to customers with online and social media advertising but taking the entire brand experience online by engaging with customers on social channels and adapting to digital forms of experiences.

2- Understanding the new normal customer

While adapting to meet customers in the new environment is crucial, its just as important to really understand who the new normal customer is.

While they are of course the same people as before, habits and circumstances have completely changed – what customers want, and their priorities have completely shifted. As a result of this shift brand loyalty for many has gone back to square one, with more consumers changing and trying new brands this year than ever before. Whilst this puts retailers under even more pressure, it also presents an opportunity to attract and impress completely new customers.
But what has caused this shift, and who is the new normal customer?

The New Normal Customer

3- Embracing Omnichannel

Omnichannel retail, offering an integrated and consistent experience between online and offline channels, is not a new concept in the industry. But much like online shopping, omnichannel offerings have become exponentially more valuable since COVID-19.  With the balance between digital and physical retail shifting, retailers offering a strong omnichannel experience are in a far stronger position than those who do not. Simply having an eCommerce site on top of stores (multi-channel) will put retailers in a better position as pure-play brick-and-mortar retailers, as they can take advantage of the increase in online shoppers and still be able to deliver to loyal customers who can no longer shop in-store. However, with pure plays being rarer than ever this is simply not enough anymore.

Omnichannel goes beyond this, by seamlessly integrating online and offline channels, allowing for offerings like click and collect (Buy-online-pickup-in-store/BOPIS), return-to-store and ship-from-store (BOSFS). The benefits of such a strategy go both ways. Customers get access to more available stock and convenient purchasing options; they can collect from stores (BOPIS and curbside) or can get products shipped straight to their homes. For retailers, omnichannel allows you to leverage stores as miniature distribution centres, cutting down on shipping costs while keeping struggling stores busy. With click-and-collect, the benefits are similar and allow stores to benefit from and serve online customers, Curbside pickup is a new type of click-and-collect that has become hugely popular since the pandemic as it keeps customers feeling safe and allows for social distancing.

Omnichannel Retail

4- Optimising costs

As much as positioning for the new normal is vital for success going forward, the unfortunate fact is many brands will be struggling with the financial impact of COVID-19. As a result, optimising costs across the board is vital for retailers trying to weather the storm and stay open long enough to adapt to the new normal. Retailers feeling the worst of the financial strain of COVID will be forced to rethink their footprint in order to survive. Closing down stores and losing staff is always a last resort, but one the vast majority have been faced with this year, as less profitable locations are surrendered to ensure the survival of the brand. But what about retailers in stronger positions, those looking to optimise their costs in the long-term without hampering themselves or their customers?

For stores, improving the efficiency of in-store processes across the board can reduce operating costs in the long-term. Processes like inventory management (Processing inbound shipments, stocktakes, replenishment) point-of-sale and loss-prevention can all be streamlined with cost-effective technology. The focus should not be to manage these things more cheaply but to manage them more effectively. To use the point of inventory management, Detego has repeatedly found that increasing stock accuracy in our customer’s stores from an average of 70% to 98% means stores can run with far leaner inventories. If you do this at scale across your entire store network, it’s possible to reduce working capital by 10-15%.

In the supply chain too, there are huge opportunities to run more efficiently and reduce costs. The cost of handling and processing the flow of goods throughout the supply chain, particularly in Distribution centres, can be reduced by investing in technology like RFID and warehouse automation which reduces labour and handling costs. By improving the accuracy and visibility of their supply chain retailers can also reduce chargebacks and other costs associated with shipping mistakes. Finally, there are huge savings to be made by achieving full supply chain visibility – knowing exactly where individual items are (and where they’ve come from) allows retailers to fully optimise their supply chains reducing losses from shrinkage, counterfeits, and grey market goods.

5- Re-thinking data and digital for a post-COVID world

Retail, particularly sectors like fashion and beauty, has been facing the need for digital transformation for a few years. The rise of online channels, digital-first consumers, and the continuous advance of technology has meant brands can’t afford to stand still when it comes to how they run their businesses. Whilst understandably many brands are focusing on staying afloat in the immediate aftermath, COVID-19 did not stop this need for transformation – it accelerated it. Now there is a greater need than ever to ensure brands have the data and IT infrastructure to react to change and make the right decisions. With the sudden shift in the industry caused by the pandemic, retailers may need to revisit digital and analytics priorities but adapt them to a post-COVID world.

In times of uncertainty, accurate data, improved visibility, and effective analytics can make all the difference. We’ve already discussed how retailers with the right infrastructure (meaning accurate visibility over their products) are profiting from their omnichannel offerings. But having a mature tech stack can unlock tonnes of value that will be vital in the new normal. For example, item-level visibility and granular data in the supply chain not only allows for greater agility when dealing with supply and fulfilment but the data can be used for advanced analytics like demand prediction and inventory optimisation across store networks.

Want to explore this topic further?
Learn more about omnichannel with Detego:

As part of both the new FastTrack and the Customer Success co-sponsorship programmes, Detego will work alongside Microsoft to develop further AI and big data features to their leading RFID platform.
Watch the latest episode the Retail Corner Podcast, where Detego's executive chairman, Kim Berknov, joins a panel of industry experts to discuss a growing trend in retail: the pop-up store. 
Discover how RFID is changing retail for good. This eBook will guide you through the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Explore the common challenges preventing retailers from achieving their goals and learn how applying smart RFID-based solutions delivers consistently good results.

Watch the latest episode of the Retail Corner Podcast, where Detego’s executive chairman, Kim Berknov, joins a panel of industry experts to discuss a growing trend in retail: the pop-up store. 

Digital retailers looking to expand into the brick-and-mortar sector are eyeing fairly new concept of Pop-Up Stores to lower implementation cost, test new markets and increase engagement with new customers.

In this panel discussion,  experts from the retail industry bring into the spotlight the value-added benefits, logistics, misconceptions and supported technology in creating pop-up stores.

 

You can listen to Retail Corner here, or watch below:

The Panelists:

Kim Berknov – Executive Chairman, DETEGO

Sampath Kannan – CEO, Tejas Software

Vince Cavasin – Head of Marketing, FenixCommerce

Vivek Raj – CEO, Digital Spaces Inc

Anil Varghese – CEO, Proxima360

Moderator:

Carlos Diaz – Director, Sales, Proxima360

Detego's Latest Retail Insights & News

As part of both the new FastTrack and the Customer Success co-sponsorship programmes, Detego will work alongside Microsoft to develop further AI and big data features to their leading RFID platform.
Discover how RFID is changing retail for good. This eBook will guide you through the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Explore the common challenges preventing retailers from achieving their goals and learn how applying smart RFID-based solutions delivers consistently good results.
The RFID Software Specialists Joins Network of Companies Certified to Help Businesses Implement GS1 Standards

Want the latest retail and retail tech insights directly to your inbox?

Discover how retail RFID is changing the industry for good. This eBook will guide you through the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Explore the common challenges preventing retailers from achieving their goals and learn how applying smart RFID-based solutions delivers consistently good results.

What is in the eBook?

The retail industry is currently ruled by change. The digital age has seen a huge growth in competition from e-commerce and a rapid shift in consumer preferences. This shift has altered the industry greatly with modern ‘omnichannel’ customers demanding to shop where they want, how they want and when they want. Delivering such an experience is a challenge, one that requires brick-and-mortar retailers to change.

To compete in an increasingly digital environment, brands need the right supporting technology to establish full transparency between their shopping channels and offer consistently excellent service online and in-store. On top of this, the extreme competition within the industry and the subsequent pressure on retailer’s bottom lines means finding ways to reduce or shift costs and eliminate inefficiencies at scale is a priority – again, technology may provide the answers here.

Retailers then are faced with the challenge of providing a better experience to customers while scaling back and consolidating in order to stay financially viable, how do you achieve both at once without overstretching resources and risking multiple technology projects? Obviously, a focus on the specific problems that need solving is key but with the scale of these challenges, you need a transformation that affects the core of the business and isn’t putting lipstick on a pig.

In this regard, Radio Frequency Identification (RFID) is somewhat unique in the retail technology market, due to the sheer versatility of the technology and its ability to solve so many of retail’s most common needs. It is this scope of use cases that have seen RFID become increasingly prominent in the retail environment.   Whilst the basic principle of RFID, tagging inventory with its own unique radio signal, is deceptively simple, its uses and applications are incredibly broad.

In this eBook, we analyse the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Within each of these needs, we identify the challenges often preventing retailers from achieving them, and how applying smart RFID-based solutions can deliver consistently good results.

Improving key metrics in stores

The ebook will teach you how RFID revolutionises daily processes like stocktakes and replenishment in stores. Learn how retailers are using the technology to deliver higher inventory accuracy in-stores (increasing from ~70 to 99%) and to ensure the right product is always available for customers to buy on the shop floor (known as increasing product availability). The eBook will also show you how retailers can achieve these results whilst actually lowering the labour intensity (and costs) of operational store processes like cycle counts and processing inbound shipments.

  • How retailers use RFID for quick and efficient stocktakes and cycle counts
  • Improving stock accuracy in stores
  • How smart solutions are being put to use for item-level replenishment, ensuring products and sizes are always available to be sold.
Results of RFID Retail

Delivering to customers with retail RFID

Find out how retailers use RFID to reliably deliver to their customers by removing common friction points as well as offering new services and shopping experiences. Common pain points eliminated by RFID include: customers being unable to find the right product,  staff not being available to help with requests and service due to lack of time for the customer, or unreliable stock information. On the other end of the spectrum, advanced RFID retailers can wow customers with new shopping experiences both in-store and online.

  • How stores can reduce common customer friction points
  • The relationship between RFID and effective omnichannel services
  • The advanced retail RFID solutions that improve the in-store customer experience like chatbots and smart fitting rooms.
RFID Omnichannel Retail

Optimising supply chains from source to store with automated processes

Learn how advanced RFID retailers have moved upstream to cover their entire supply chains, from stores to warehouses, distribution centres and even factories. The eBook covers how RFID is used to achieve complete supply chain visibility and what additional value this unlocks for retailers due to the advanced item-level data and analytics available.

  • How to achieve supply chain visibility with real-time info on the movement of products inside and across individual stores and distribution stages.
  • How RFID is used to aid logistics at distribution centres, including automated processes like exception handling and order picking.
  • What RFID means for retailer’s data and analytics capabilities, such as advanced supply chain traceability and new KPIs for stores and DC’s.
Retail Supply Chain

Protecting brands and products from theft, counterfeits and the grey market.

Finally, gain insight on how retailers deploy RFID solutions to protect their products, and their entire brand, from illicit activity including theft, counterfeit products and the grey/gray market. The eBook explains how retailers can use the technology to identify individual products and trace them across the supply chain, allowing them to identify where problems are occurring, and stop them at the source.

  • How RFID can be used to monitor and reduce shrinkage, including theft, both in stores and across the entire supply chain.
  • How brands are combatting counterfeit goods by tagging and tracing their products with RFID.
  • What the Grey Market means for retail and how several major brands use RFID traceability to locate and stop the source of grey market products.
The Sources of retail shrinkage

Watch the latest episode the Retail Corner Podcast, where Detego’s executive chairman, Kim Berknov, discusses RFID technology’s ongoing impact on the retail industry. 

As retail companies try to adapt and think outside the box in the new normal, more than ever, every sale is of extreme importance. This brings crucial importance to the never-ending quest for 100% accuracy of having the right merchandise at the right place, at the right time. Kim Berknov joins Proxima360‘s Carlos Diaz on the Retail Corner podcast to discuss transforming inventory accuracy with RFID.

The podcast covers:

  • What improvements have been made to RFID in order to see drastic changes in cycle counts, inventory counts and receiving merchandise
  • The timing and productivity difference between conventional inventory counts versus RFID technology
  • How RFID improves the replenishment process
  • The best approach to get started in implementing RFID
  • And more…

You can listen to Retail Corner here, or watch below:

Detego's Latest Retail Insights & News

As part of both the new FastTrack and the Customer Success co-sponsorship programmes, Detego will work alongside Microsoft to develop further AI and big data features to their leading RFID platform.
Discover how RFID is changing retail for good. This eBook will guide you through the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Explore the common challenges preventing retailers from achieving their goals and learn how applying smart RFID-based solutions delivers consistently good results.
The RFID Software Specialists Joins Network of Companies Certified to Help Businesses Implement GS1 Standards

Want the latest retail and retail tech insights directly to your inbox?

How is a Detego stocktake different?

For retail stores using the Detego platform, the stocktake is where it all starts. While typically stores would only perform a full stocktake, also knows as a cycle count or an inventory, a handful of times a year, the RFID-powered Detego application allows stocktakes to be performed bi-weekly or even daily.

Staff perform a stocktake through the Detego mobile application, connected to a handheld RFID reader. The application guides staff through the process, displaying the current count, the differences from the target list and the stock accuracy percentage. Stocktakes are vital to maintaining an accurate inventory – with the Detego platform stores can reach as high as 99% stock accuracy.

What problem does it solve?

Regular stocktakes are essential to maintaining a high level of stock accuracy and maintaining On-Floor Availability (OFA) of products. Performing regular stocktakes:

  • Is the key to achieving high stock accuracy and shop floor availability
  • Enables store managers to uncover stock discrepancies
  • Provides insight into product performance and enables review of pricing strategies
  • Exposes theft

However, a manual count of inventory or a barcode cycle count is incredibly time-consuming. Counting items individually takes at least several hours and often means closing the store or working around opening hours. As a result, cycle counts in retail stores are typically only performed a handful of times a year, meaning lower stock accuracy in stores – the average being between 60-70%.

The Detego platform changes this. Powered by RFID, staff using the stocktake feature can perform a stocktake of both the backroom and salesfloor in around 30 minutes (depending on store size). The RFID reader can read product signals all at once, so it can count hundreds of items in seconds. A Detego stocktake can also never count a product more than once and is far less likely to miss items as direct line of sight is not needed. The result of this an increase of stock accuracy to ~98%.

‘We scan every day, giving us the accuracy of the exact stock we have in the store, in roughly 35 minutes’
Manisha Hassan, Reiss Store Manager

The Detego system:

  • Makes stocktaking much more efficient, easier, and faster
  • Brings more accurate stocktake results
  • Reduces operational costs of doing a stocktake

Why is having a high stock accuracy in stores so important?

Stock accuracy for stores has become a core KPI for retailers. At the most basic level its vital for maintaining the availability of products on the salesfloor and preventing out of stocks which in turn increases sales – our customer, Reiss, increases sales by 4% by increasing their stock accuracy. Stores without such accurate inventory must compensate to maintain sales, so they will often carry excess stock to prevent out of stocks and lost sales. Increasing stock accuracy in such cases results in a significant reduction in inventory size, reducing working capital by as much as 30%.

When you look at more advanced retail trends, like the increasing connection between online and offline – high stock is simply non-negotiable. Offering online customers real-time store stock information naturally requires the retailer to know exactly what is in stock, and advanced services like buy-online-pick-up-in-store (BOPIS) built off of poor stock accuracy are destined to fail.

How does it work?

  1. Each staff member selects the stocktaking option on their handheld device.
  2. As each staff member reads the items in their designated area, their handheld device reflects the number of items that they have read and the current stock accuracy.
  3. If more than one person is performing the stocktake, the devices are synchronised, and the stock accuracy is calculated using all the counts.
  4. Once most items have been read, staff can see the number of differences between the actual and target counts and can attempt to resolve the differences (for example, re-reading an area and replacing any missing tags).
  5. When a staff member has completed their read and resolved as many differences as possible, they confirm the result on their device.

The Detego stocktake in action

Our customers, fashion retailer Reiss, implemented the Detego platform in their 50 UK stores. They moved from doing 2-3 cycle counts a year to a stocktake every day. The result was an average store stock accuracy of 98%, and a resulting 4% uplift in sales.

Types of stocktake with the Detego platform

Guided Stocktake

A guided stocktake is the most common method for a Detego cycle count. Guided means that the handheld readers used for a stocktake show the number of items that the device has read and the calculated stock accuracy based on the number of products read by all devices and the expected stock of the store.

After reading all of the items in the store, staff can investigate the differences between the actual and expected counts, a process called difference clarification.

For example, staff may realise that they missed an area in the location they were reading, or there may be a surplus of a specific product on the salesfloor. Once staff have resolved as many differences as possible, they confirm their final count.

Guided Stocktake app

Blind Stocktake

A Blind stocktake works the same way as a guided one except that the handheld readers only show the number of items that the device has read. They don’t show the expected number of items or the current stock accuracy and staff can’t investigate any differences on their handheld device. Staff simply read the items in their designated location and confirm their count when their read is complete.

  • May be required for regulatory reasons
  • Enables the store manager to control the stocktake as individual store staff cannot investigate differences on their own
  • Reduces the risk of items going missing during a stocktake
Blind stocktake app

Partial Stocktake

A Partial stocktake checks a subset of inventory, for example, a category of items, such as footwear, or a specific product. Partial stocktakes are useful if there is not time to perform a full stocktake, or if there are issues to resolve with certain types of stock. Partial stocktakes are useful in the following situations:

  • A full stocktake would take too long to complete in the time available
  • A full stocktake has highlighted issues with a particular item or location that need further investigation
  • A full stocktake for large stores would be complex and difficult to manage, so it’s more efficient to check individual locations separately
Detego Retail Store Application

Cloud-hosted RFID software

Stock accuracy, on-floor availability, and omnichannel applications in stores.

Detego Store is a cloud-hosted RFID solution which digitises stock management processes, making them more efficient and more accurate. Implemented within hours, our multi-user app can provide intelligent stock takes and a smart in-store replenishment process. Later, you can scale the solution to offer omnichannel services and effectively manage your entire store operations with real-time, item-level inventory visibility and analytics.

Summary of RFID in Retail

Radio Frequency Identification (RFID) is a growing force behind the scenes in retail. For the uninitiated, the technology involves using radio frequency (RF) to share information about an object’s unique identity (ID). An RFID reader can identify or ‘read’ hundreds of tags in a matter of seconds, at a distance of several feet. For retail, this reduces the reliance on barcodes for inventory management and opens the door to more advanced applications utilising real-time data.

While the story for RFID in retail began in stores, due to the dramatic increase in stock accuracy that it provides driving sales and setting a platform for omnichannel retailing, the potential for RFID in the supply chain has always been there. Now that many global retailers have implemented RFID in stores, they are beginning to leverage and unlock the power of RFID across the supply chain.

For the supply chain, RFID means accuracy, efficiency, and visibility, all of which have a big impact on operations.

The results of RFID in the Supply Chain:

RFID in each Stage of the Supply Chain

Factory

For a truly end-to-end view of the supply chain, RFID tagging must start at the factory. Items are encoded with an RFID tag at source, where they will be tracked from here to the point of sale. Once items are tagged and ready to ship, the first ‘read-event’ of the process takes place. The shipments are either put through an RFID tunnel (an automated tunnel fitted with an RFID reader) or read with a handheld reader. This outbound count ensures shipping and tagging accuracy, diverting any anomalies to be checked and fixed, and creates item-level ASN’s (advanced shipping notices) to send to the distribution centre, so they know precisely what they will be receiving. Having every item logged at this stage is also vital for creating visibility over the entire supply chain.

As most brands have anywhere from 10-100+ factories supply their DC, it is vital to ensure that the shipments are accurately accounted for to prevent errors further down the supply chain.

Retail RFID Factory

Distribution Centre

The distribution centre is the heart of any retail supply chain. Goods come in from the factory, and orders go out to, and occasionally come back in from stores, franchises, and customers. As it is logistically the most complex stage, it is here where the majority of processes are supported by RFID:

RFID Distribution Centre

Store

Once shipments arrive at the store, an inbound RFID read can be performed, confirming the order, and checking the contents against the shipping notes. Inside the store, a whole host of RFID processes and new services can take place, but we won’t explore those here.

RFID store

Supply Chain Processes with RFID

When goods arrive at either the distribution centre or the store, RFID readers are used to quickly count the shipments on an individual item-level. Because DC’s have far higher item throughput than stores, they often utilise automated RFID tunnels for this. Shipments entering the DC go directly onto a conveyor and are accounted for as they pass through the tunnel.

The software then compares inbound reads to the advanced shipping notice and updates the warehouse management system or ERP with accurate information. This process helps maintain the integrity of the stock system and also spots discrepancies early so they can be reconciled and fixed quickly (holding suppliers accountable for mistakes).

This is also where incoming returns are processed. Since RFID tags are unique and can’t be forged, DC’s using the technology can easily identify fraudulent returns, as well as processing the legitimate ones faster.

The packing process also utilises RFID when putting together orders and shipments. The process will vary depending on the DC, but RFID can support the process by a picker using RFID tables or audit stations to confirm the carton is correct by checking the actual contents against the picking list.

RFID Pick and Pack

Finally, RFID is used to count, verify, and log all outbound shipments.
Goods pass along automated conveyor belts through RFID tunnels. Box barcodes (Using a target list supplied by the Warehouse Management Systems) are scanned at the entrance to the tunnel and an RFID reader in the tunnel reads the contents of each box. If the tunnel detects any differences against the target list, the conveyor system automatically diverts the carton for further inspection.

Outbound results are then sent to the WMS, to update the stock information for the DC. When the DC has processed all cartons from the target lists, the system creates an advanced shipping notice (ASN) for the store that will receive the goods.

The benefits of RFID in the supply chain

Now we have run through how retailers use RFID at specific stages in the supply chain let’s look at the results of doing so. We can broadly split these benefits into three areas:

Accuracy

Accuracy is often the first thing people think of when they hear RFID and with good reason. For the supply chain, RFID improves shipping and inventory accuracy by

1 – Performing more reliable (99%) inventory counts than traditional methods 

2 – Counting on an item-level as opposed to an SKU level 

3 – Being able to identify and fix mistakes at more stages of the process due to the ease and speed of RFID reads

The financial impact of improving inventory and shipping accuracy across a supply chain is huge, and can include:

Efficiency

The other great strength of RFID is the speed at which it can count and verify items or even entire cartons in seconds. With automated RFID tunnels and a conveyor system diverting any cartons with discrepancies, the efficiency of the DC is maximised, and not at the cost of accuracy.  DC’s using RFID have a higher throughput, as they are simply able to process items and orders at a faster rate.

Visibility

The other major benefit of RFID supply chains is the complete visibility they have other individual items and the movement of merchandise. This not only means shipments and items are trackable in close to real-time, but the number of ‘read-events’ from source to store creates a huge amount of highly valuable data. This data produces useful KPI’s such as throughput, dwell-time, and DC performance. It also allows retailers to trace items back through the supply chain, which is hugely valuable in terms of brand protection and loss prevention.

Summary

RFID is used to accurately count, correct, and track all individual items and cartons across the supply chain. This starts in the factory where items are tagged at source, goes on to the distribution centre where orders are sorted and finally sent out to stores. Every time an item enters or leaves a stage of the process it is counted with RFID and all mistakes are identified and corrected.

The most notable benefits for supply chains using RFID come in the form of greater accuracy, efficiency, and complete visibility over the flow of goods. The increased accuracy of both inventory and individual orders can lead to top-line growth, fewer stock outages and the reduction of customer chargebacks for shipping mistakes. The efficiency increase makes supply chains more durable and increases overall item throughput and finally, the visibility of items allow retailers to optimise their operations and offer better services such as omnichannel purchase options.

RFID can be used for all inbound and outbound shipments, logging the contents of each order, and comparing them to the target list – which identifies shipping mistakes before they happen. RFID can also be used in the picking and packing process, counting the items in a carton as the DC staff picks the order, RFID software then confirms whether the order has been picked correctly before it is sent for outbound processing.

There are several types of RFID readers used throughout the supply chain. RFID tunnels are fixed readers built into a conveyor system, they scan the contents of cartons without needing for the carton to be opened and if they detect any discrepancies the conveyor will send the carton to an exception lane. RFID chambers are often used during exception handling, whereas audit tables can be used for this as well is the picking process. Finally, the handheld RFID reader is often used in stores or storage areas when staff need to move around a space to perform a cycle count.

Detego Warehouse Software

RFID software for the warehouse

The digital supply chain

Detego’s RFID-based warehouse software enables retailers to automate and dramatically improve their receiving, picking/packing and shipping processes in factories and/or distribution centers. These steps are vital parts of an end-to-end RFID solution, providing full visibility across the entire supply chain.

As part of both the new FastTrack and the Customer Success co-sponsorship programmes, Detego will work alongside Microsoft to develop further AI and big data features to their leading RFID platform.
Discover how RFID is changing retail for good. This eBook will guide you through the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Explore the common challenges preventing retailers from achieving their goals and learn how applying smart RFID-based solutions delivers consistently good results.
The RFID Software Specialists Joins Network of Companies Certified to Help Businesses Implement GS1 Standards

What is Smart Shield?

The Detego Smart Shield is a cutting-edge feature that determines the location of individual RFID tags, by using machine learning algorithms. This allows the Detego Platform to differentiate between the backroom and sales floor of a store, without the need for expensive physical shielding installations.

It’s vital that a stocktake tells you not only exactly what is in a store, but where the items are too. The two locations that need differentiating in stores are typically the backroom and the salesfloor. Store staff, and the Detego platform itself, need to be able to see exactly what’s on the sales floor so they can identify when items and specific sizes are running low so they can be replenished from the backroom. If this isn’t done, you can end up with products in stock but not available to purchase on the shop floor – a costly and easily avoidable mistake.

What problem does it solve?

RFID is able to read items from several feet away, and even through objects like boxes and walls – this is what makes it such an excellent technology for managing inventory. What this means, however, is that a staff member doing an RFID-based stocktake in the backroom could accidentally pick up signals from the sales floor, and therefore allocate items to the incorrect location.

The old solution to this problem involved using a physical shield that blocks RFID signals, often in the form of metal sheets or metallic paint. Making physical modifications to a store such as these is both expensive, costing up to $5000 per store, and time-consuming. When it comes to large scale rollouts of hundreds of stores, the added costs and manhours can be a major barrier to entry for RFID.

With the Detego platform, the need for physical shielding is removed entirely, significantly reducing the cost and time to implement RFID in stores. The Smart Shield feature is available out-of-the-box, meaning retailers can implement the cloud-hosted software in stores with very little fuss.  This is what makes the Detego platform the most ‘plug and play’ RFID software on the market.

How does it work?

Every RFID tag creates a specific time and signal stamp when being read by an RFID reader – up to several times per second. Detego collects this data (created during stocktakes) and applies machine learning algorithms to determine the most probable location of individual tags.

Explanation of Smart Shield

Detego Smart Shield Diagram

The Detego Smart Shield in Action

The Smart Shield feature makes a massive difference for retailers undergoing RFID store rollouts at scale. These benefits include:

  • Determines the location of individual items, with no need for physical shielding between separate stock locations
  • Help optimise other processes and features, such as stock replenishment advice
  • Allows for faster roll-out and reduces up-front costs, as no physical shielding is required

A Detego customer utilising Smart Shield recently rolled-out the platform in record speed, achieving 100 stores per month and with a stock accuracy of greater than 98%. This speed of implementation is far beyond anything seen before Smart Shield and allows retailers to get up and running quickly to unlock the benefits of the platform, driving an instant return on investment throughout their store network. By achieving high stock accuracy and on-floor availability in stores, Detego customers typically see between 3-10% revenue increase per store.

Detego Retail Store Application

Cloud-hosted RFID software

Stock accuracy, on-floor availability, and omnichannel applications in stores.

Detego Store is a cloud-hosted RFID solution which digitises stock management processes, making them more efficient and more accurate. Implemented within hours, our multi-user app can provide intelligent stock takes and a smart in-store replenishment process. Later, you can scale the solution to offer omnichannel services and effectively manage your entire store operations with real-time, item-level inventory visibility and analytics.

Webinar Recording: Best Practice RFID for Retail Supply Chains

 

Retail has evolved dramatically in recent years, driven by changing customer expectations, online disruption, and the ongoing digitisation of the industry. Whilst many stores are embracing technology to wow customers and deliver seamless experiences across multiple channels, behind the scenes supply chains are evolving too.

In this webinar we outline how Radio Frequency Identification (RFID) technology is strengthening supply chains and delivering the accuracy and transparency that modern retail demands. Covering the item-level journey from source to store, the presentation will explain how and why major retailers are choosing RFID to digitise and future-proof their supply chains.

This webinar covers:

  • The business case and benefits which RFID technology can bring to the retail supply chain
  • Key RFID processes and use cases in factories and distribution centres/warehouses
  • Best-practice approach and strategy for implementing RFID across the supply chain
  • Examples of successful customer implementations and learnings
  • Critical insights to successfully manage new supply chain challenges during COVID-19 pandemic

When it comes to digital transformation, RFID (Radio Frequency Identification) has been the hype in retail for several years now. It has, however, been a bumpy road to success. In the past, stories of failed implementations and botched rollouts were far too common and kept many retailers from taking the plunge. Thankfully these days the picture is much more encouraging. We are now spoilt for case studies and examples of retailers having enormous success with the technology to digitise their inventory and processes for the modern retail environment.

 

So, what makes the difference between failure and success?

Ultimately it comes down to a combination of knowledge, technology and price. Improvements in all three of these areas have evolved the technology into a vital component of any digital transformation journey in retail. But as with any transformative project, getting the detail right is vital. The approach to implementation and suppliers you choose to engage with will have big implications on ROI.

A best-practise approach is easier said than done, so you need to surround yourself with a team of experts who have skin in the game and ensure the solution you choose to implement has the capabilities to lead your digital transformation for years to come.

Technology Venn Diagram

Our recommended 6 steps to digital transformation with RFID:

 1.   Understand the problems you want to solve and clearly define the KPIs

The first step in any new tech investment is to be sure that you have clarity around what problems you are hoping to solve. This will often require some hard-hitting questions and honest auditing of current processes and data to understand where you and your customer’s biggest pain points are. Customer feedback surveys are always a good way to gain insight into this.

 

What common retail problems can RFID solve?

  • Stock inaccuracy leading to out-of-stock situations
  • Poor product availability on salesfloors and webshop resulting in lost sales
  • Labour costs and operational inefficiencies
  • Reduction in excess/safety stock
  • Inventory visibility and supply chain traceability

Luckily, these problems all have clear KPIs related to them and can be used as a great measurement tool to understand your current position and build a business case for the investment.

2.   Choose a software partner that will help you achieve more

Once you have clearly defined RFID as the technology you want to implement, it is then vital to choose the right partners to go on your digital transformation journey with. Within the RFID market, there are generally three partner types – hardware, labels and software. The software component is the most important aspect as this must be able to process all the data, integrate with existing systems and empower employees with user-friendly applications to improve daily processes. Choosing the best-suited partners will make all the difference to ensuring you have a scalable and future proof solution for the next 5+ years.

 

What to look for in an RFID software partner?

  • Credibility in the market – do they have proven RFID deployments with reputable brands in your sector?
  • Future-proofed services – do they have a product roadmap that inspires innovation and constant improvement?
  • Scalability and flexibility – does the solution fit your business needs and implementation roadmap?
  • Industry expertise – do they have deep industry knowledge to understand your specific business requirements and help you think through these challenges?
RFID Implementation Ecosystem Diagram

3.   Trial the solution, prove the business case

Any digital transformation project requires buy-in from multiple departments and key decision-makers. The best way to achieve this is to prove the business case in a live retail environment. This is done through a ‘Pilot’ process whereby the solution is tested in around 3-5 live stores, allowing for the critical KPIs to be assessed and to gain a clearer understanding of the implications for store processes. With SaaS-enabled solutions, this process can be done more efficiently through the use of cloud-hosted mobile solutions, essentially making them ‘plug & play’.

 

What does the pilot process involve?

  1. Tagging party of all items in Pilot stores with RFID labels

  2. Product Master Data uploaded to SFTP (or FTP)

  3. Training of store associates

  4. Use of handheld readers and mobile app to perform daily store operations

  5. Daily KPI tracking to analyse results:

    • Improvement in stock accuracy
    • Improvement in on-floor availability
    • Increase in sales
Detego RFID Software Dashboard

4.   Store rollout with speed for immediate ROI

Although it seems attractive to enable all of the features and RFID-enabled services in one go, and undergo a digital transformation overnight, the reality is often different. Instead, retailers should approach implementation in phases to manage the changes in process and IT requirements. A best-practice approach to RFID implementation should focus on improving the fundamental processes that will bring the most immediate ROI to the business. These processes include stocktakes and replenishment to significantly increase stock accuracy and on-floor availability within stores. Improving these two KPI’s generally results in a direct sales uplift of 5-10%. From there, you can re-invest returns back into the continuous enablement of RFID throughout your business.

 

What elements are most critical to a successful store rollout?

 

  • Speed and ease of implementation

    • New innovations such as Smart Shielding removes the need for physical shielding installations – saving time and money.
    • SaaS-enabled platforms allow for scalable pricing models and cloud-hosted solutions.
    • Open APIs allow for easy system integration with ERP

 

  • Support services

    • Training to educate staff on the changes in daily processes
    • Customer success and support to maximise the use of the software

 

  • Change management leadership

    • Ensuring you have a dedicated team to oversee the rollout

5.   Full omnichannel enablement

After securing the foundations of stock accuracy and on-floor availability in stores, the next step is to connect the online and offline business. Omnichannel services such as click & collect (aka BOPIS) and Ship-From-Store are expected in the modern retail environment as consumers demand to shop anywhere, anytime and any way they want. However, it’s important to ensure you can deliver on these retail experiences so that customers don’t end up disappointed. Enabling this requires connecting inventory from your store networks with your distribution centres and webshop to create a single and transparent view of stock.

 

 What’s required for Omnichannel retailing?

  • Transparent view of stock across all stores made available to the online store
  • Automate warehouse processes with RFID tunnel and outbound processes
  • Offer new services such as click & collect, ship-from-store etc.
Single stock view

6.   Unlock the true power of RFID with new retail experiences

 

Stock accuracy, product availability and omnichannel services are synonymous with RFID in retail and should always be the focus of any digital transformation utilising the technology. However, there is also an unlimited amount of untapped data and potential that is a sitting gold mine once you have RFID implemented throughout the supply chain. New solutions for consumer engagement and artificial intelligence engines can now be utilised to provide new services, experiences and insights for retailers and consumers alike.

 

What new innovations can be enabled?

Interested in discussing your RFID Journey? Talk to the experts.

At Detego we know retail and we know RFID. This combination has enabled us to develop the most innovative RFID software solutions on the market, alongside major global fashion brands. With RFID now on almost every retailer’s roadmap, we have the answers for any step of the journey, anywhere within your operations.

Everyone has to start somewhere, which is why we have out-of-the-box solutions to quick-start your RFID journey. Alternatively, if RFID is well and truly ingrained in your business, then talk to Detego about how we are using AI and innovative new practices to take real-time decision making to the next level.

Digital store journey

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As part of both the new FastTrack and the Customer Success co-sponsorship programmes, Detego will work alongside Microsoft to develop further AI and big data features to their leading RFID platform.
Discover how RFID is changing retail for good. This eBook will guide you through the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Explore the common challenges preventing retailers from achieving their goals and learn how applying smart RFID-based solutions delivers consistently good results.
The RFID Software Specialists Joins Network of Companies Certified to Help Businesses Implement GS1 Standards