RFID for ASEAN retailers of all sizes

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The COVID-19 pandemic has changed the way consumers shop forever. There has been an unprecedented growth in e-commerce, especially in ASEAN, where e-commerce hit $62 billion USD in value in 2020. It is forecasted to reach $172 billion USD by 2025, which is about 2.8 times the 2020 volume.

While the exponential growth of e-commerce is welcomed amid slowing economic activity due to the ongoing pandemic, many retailers were not prepared for the surge in demand, much less the sudden popularity of the internet and mobile shopping.

According to Zebra’s 14th Annual Global Shopper Study, 82% of APAC decision-makers agreed they need to reduce the expenses of online orders, which is the highest of any region. With the upcoming holiday season and mega sale events, retailers across the region are struggling to manage consumer demand and regain control over inventory. Malaysia and Thailand saw the highest increase in indexed sales of 600% and 305% respectively during Singles’ Day, while Singapore saw a 250% increase in indexed sales. The popularity of these e-commerce events makes it evident there is a need for retailers to preserve their reputation, maintain their customer base, and protect margins during this rapid growth period.

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The rise of RFID

Radio frequency identification (RFID) technology is no stranger to the retail market. RFID technologies are seeing renewed interest from retailers big and small, as the retail market faces an immediate need to undergo digital transformation. According to the same study, key technologies that associates say has helped to create a better customer experience include ultra-high frequency (UHF) RFID. Though the barcode has historically been the hero solution, technological advancements have given rise to new and better ways to manage and track inventories. As such, integrating RFID technology alongside existing solutions like barcode-based, track-and-trace and inventory-management systems can help retailers further boost fulfilment efficiencies. 

RFID systems can automatically read thousands of tagged items and provide highly accurate information about the location of an item. For example, there are both fixed and handheld RFID readers that, unlike barcode scanners, do not need a direct line of sight to the label on the package to extract and confirm status details. These RFID readers can collect real-time data and share information as long as they are within proximity range.

In the past, most retailers were deterred by the logistically complex and cost-prohibitive nature of RFID solutions. However, the combination of new read-to-cloud software and RFID sleds has made this advanced tracking technology accessible to all. Even small retailers can utilise RFID technology by equipping associates with the right mobile computers and building a simple app to send RFID-captured updates to the cloud. In Singapore, for example, local convenience stores are experimenting with RFID technology and artificial intelligence to pilot unmanned kiosks in an effort to digitalise and overcome difficulties faced in the sector.

Using RFID sleds

In cases where retailers are unable to install fixed RFID readers in retail stores, handheld RFID readers are sufficient to monitor shelf inventory, as associates can do a quick lap around the store to capture tag data. However, it is relatively inefficient for associates to carry multiple devices, which increases the workload of the IT team that supports them. This is where RFID sleds come in handy, as they can automatically read thousands of RFID tags while simultaneously functioning as barcode scanners for more targeted item reads.

RFID sleds are snap-and-go accessories that can instantly transform associates’ mobile devices into RFID readers without requiring wire harnesses or special user training sessions. The process is simple: upon connecting the RFID sled to a mobile computer, the associate can collect data from more than 1,300 tags by simply pointing the device in the general direction of the inventory to be counted. In less than 15 minutes, over a million different items can be accurately accounted for in stores, stockrooms, and warehouses. Without RFID, it could take hours or days to count or locate that much inventory – with potentially less reliable outcomes, as items are constantly being moved throughout the day.

Introducing RFID sleds into the system allows sourcing teams to be alerted whenever stock is running low so they can reorder before a complete stock-out – which is important considering the Zebra study also found that out-of-stock complaints are the biggest frustration of retail store associates (44%). With RFID sleds, merchandising leads now have accurate visibility into inventory, allowing pricing promotions and replenishment tempos to be adjusted accordingly based on real-time sales volume. Store associates can also confirm shelf quantities and locate backroom inventory in a matter of seconds, not minutes or hours. Shoppers can check if the items they want are in stock online before making a trip to the store as inventory systems will be up-to-the-minute accurate. This way, customers will be able to know where to swiftly find their desired product.

Small changes, big impacts

Like any other hardware-reliant solution, RFID readers alone are not enough. There is a need to integrate RFID technology with cloud-based solutions to maximise operational efficiency and improvements. With the simultaneous rise of e-commerce orders and return to in-person shopping, retailers have the responsibility to provide a seamless omnichannel shopping experience to adapt to shoppers’ flexible shopping habits. This means there is more inventory to be managed across multiple channels. While this may sound complicated, simple solutions such as RFID sleds prove that retailers do not necessarily need to make huge investments to increase inventory visibility, staff productivity, or customer satisfaction. Rather than investing in more solutions, it is more important to pick the right solutions that work.