Centralised Real-Time Data Part II: Benefits of Effective RFID Integration

In Part I: The Value of RFID in Intralogistic Operations, we talked about the role of RFID technology in intralogistics operations. Now it’s time to delve into the myriad benefits that RFID implementation brings to the supply chain.

Inventory Distortion Will Cost Businesses $1.77 Trillion


Accuracy and speed are paramount. Large organisations with thousands of SKUs need accurate product management and a solution enabling multiple products to be logged quickly. Equally, smaller retail organisations need to get the investment right at this stage to allow them to grow. A poorly thought-out solution that bogs a retailer down with inaccurate or slow logging will only snowball into a more significant problem as they scale and will incur further costs down the line.

Aside from the obvious customer satisfaction issues that arise from inaccurate stock data – unfulfilled orders or incorrect out-of-stock messaging, for example –  the impact on transportation costs and storage forecasting can also not be underestimated. IHL Group estimates that inventory distortion – including out-of-stock items and discounts due to overstocking – will cost businesses $1.77 trillion worldwide in 2023.

The answer lies in technology. Specifically, RFID. Partnering with right RFID solution provider, retailers can create one single source of truth that delivers complete visibility of inventory across all operations.


ROI for Retailers

Robust automated stock management solutions reduce the need for human intervention. That resource can be allocated to more fruitful tasks while minimising the chances of human error. That means a team of people freed up to use their experience to solve broader, more pressing problems within warehouse locations and the wider business. That is a win-win for retail teams and management. It results in more engaged staff members and a real-time view of inventory, which allows management to make buying decisions more quickly, safe in the confidence that they have the right numbers at their fingertips.

With solutions such as Clustag’s providing over 99% inventory accuracy, optimising the manufacture and purchase cycle is easy with RFID. Retailers no longer need to factor in potential planning inaccuracies, minimising unnecessary spending on over-buying, long-term storage and transportation.

Equally, where multiple locations and retail channels have traditionally complicated stock management, an automated solution means fewer headaches and minimal impact when scaling to additional sites or adding retail channels. With RFID technology providing a single, real-time stock-level view, retailers can plan stock across channels and retail locations to maximise revenue during critical sales periods. They can also rapidly react to unexpected consumer demand efficiently and without unnecessary expenditure.

The Reverse Logistics

One of the biggest issues for retail returns is that the longer products spend in the reverse supply chain, the less retailers can resell them for. In some cases, these products never get resold. RFID solutions streamline the reverse supply chain process, maximising the revenue available from returned products.

A global sportswear brand deployed Clustag’s RFID technology to transform its operations. The technology enables accurate, efficient control of inbound and outbound products. The brand also uses the technology to monitor sales via its distributors, providing it with a holistic view of product popularity across its sales network.

What it Means for Customers

Customers don’t like to be disappointed. Incorrect stock levels can frustrate consumers and hasten their defection to competitors. Managing omnichannel sales operations has traditionally been challenging, particularly when operations have a global footprint.

With a real-time view of stock levels across every location a retailer operates, they can adopt a ‘fulfil from anywhere’ approach that means customers not only benefit from a wider pool of stock, but retailers can also ensure orders are fulfilled as quickly as possible, from the most appropriate location. That means faster deliveries and happier customers.


Enhancing Customer Experience


Today’s demanding consumer is laser-focused on speed and convenience. The ‘fulfil from anywhere’ approach means offerings such as buy online pick up in-store (BOPIS), buy online ship from store (BOSFS) and buy online return in-store (BORIS) are significantly simpler to implement, which plays to consumers’ desire for convenience.

Allowing customers to shop in the way that suits their lifestyles and commitments encourages them to return. Fitting into consumers’ buying patterns makes the process seamless for them and unlocks more sales opportunities through increased brand loyalty. Similarly, brand advocacy brings greater reach, particularly via social media. Nielsen’s 2021 Trust in Advertising survey found that 88% of respondents trust word-of-mouth recommendations over advertising – another reason to focus on delivering outstanding customer experiences.

Fostering a ‘virtuous cycle’ – where great customer experience leads to advocacy and, ultimately, additional new and returning customers, builds retail brands in the long term and reduces the costs associated with customer retention and acquisition. Beyond mere logistics, effective inventory management solutions can even drive down brand marketing and advertising costs.


Choosing the right RFID partner


Speed is everything in fast-paced verticals such as fashion, as product popularity fluctuates rapidly in response to social and cultural cues. RFID inventory management solutions offer the speed and reliability that retail requires.

RFID solutions also provide opportunities to grow retail businesses by delivering superior customer experiences and offer a competitive advantage by easing the introduction of customer-centric initiatives such as BOPIS, BORIS and BOSFS. A single source of truth for inventory allows retailers to expand faster, forecast more accurately and deliver next-level customer service that keeps consumers coming back for more.

Choosing the right RFID partner is critical to making smart investment decisions that will pay dividends well into the future. Accenture’s RFID in Retail study found that users who had implemented five or more omnichannel use cases for RFID saw ROI of over 10%, and those with four or fewer use cases recorded over 8.38%.


The technology can be the difference between success and failure in an increasingly demanding retail marketplace. As such, it is one of the single most important decisions retail businesses can make.

Clustag is dedicated to proving value to customers, helping them to create achieve close to 100% inventory accuracy and drive ROI while minimising the risk of human error.


To find out more about how RFID can transform your intralogistics operations, contact Clustag here.

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