The research, conducted by the RFID Research Center at the University of Arkansas, also demonstrated that the use of an RFID-enabled system could improve inventory accuracy by more than 27 percent over a 13-week period.
“This project was part of a larger research effort to demonstrate and quantify the business value of RFID item-level tagging for day-to-day operations in a retail environment,” said Bill Hardgrave, director of the research center and professor of information systems in the Sam M. Walton College of Business. “The results can guide companies as they investigate whether, and to what extent, to implement RFID. The findings provide insight on how RFID can help retailers increase efficiency and thus significantly reduce expenses, which is always important but even more so in this tight economy.”
The investigation included two Bloomingdale’s stores – a test store with an automated, RFID-enabled system and a control store with Bloomingdale’s inventory-management system – in a major northeastern metropolitan area. The 13-week project focused on two departments – men’s denim jeans and women’s denim jeans. To establish baseline information, physical inventory counts were taken three times per week for the first five weeks by workers using both RFID and barcode readers. For the remaining eight weeks, physical counts by workers using both types of readers were conducted two times per week.
The baseline information was used to determine actual physical inventory counts – as opposed to what the Bloomingdale’s inventory-management system stated – at both the test and control stores. For the final eight-week period, researchers compared inventory numbers from the test store’s automated, RFID-enabled system to both the physical-inventory figures and Bloomingdale’s inventory-management system. Using this information, researchers gathered metrics on inventory accuracy, out of stocks and cycle-counting time.
Comparing the actual inventory count to Bloomingdale’s inventory management system over the 13-week period, the researchers found that inventory accuracy declined by 3.13 percent in the RFID-enabled test store and 4.24 percent in the control store. In other words, both systems lost inventory accuracy over the 13-week period. For both stores, inventory accuracy decreased due to an increase in understock, the term used to describe the situation in which a store’s inventory-management system shows more inventory than is actually in the store.
To understand the potential effect of an RFID-enabled system, the researchers simulated Bloomingdale’s inventory-management system to help them replicate changes that would have been made by using RFID to modify and update the retailer’s system as the master record. In other words, inventory data obtained by using RFID were used to update the simulated Bloomingdale system. The simulation demonstrated that overall inventory accuracy improved by more than 27 percent. Specifically, understock decreased by 21 percent, and overstock, the term used to describe the situation in which a store’s inventory-management system shows less inventory than is actually in the store, decreased by 6 percent.
Throughout the study, researchers also tracked how long it took to count items using RFID compared to a barcode reader. With RFID, inventory scanning of 10,000 items took two hours. Scanning with a barcode reader took 53 hours. This translated into an average of 4,767 counted items per hour with RFID and 209 items per hour using a barcode system, a 96-percent reduction in cycle-counting time.
The project was part of a broader effort to identify what retailers call “use cases” or “payback areas,” which are business processes upon which retailers expect item-level tagging to have the greatest impact. In this instance, the major use cases included inventory management and loss prevention. A previous study provided an objective evaluation of item-level tagging for apparel and footwear. The primary goal for all projects is to generate greater inventory efficiency for retailers and product availability for consumers. Taken further, the research could lead to consumers purchasing items without a cash register.
For this study, the researchers used passive, ultra-high frequency, generation 2 tags. Generation 2 refers to the highest-performing technical protocol for passive RFID tags, as approved by EPCglobal Inc., the organization that sets international RFID standards.
The University of Arkansas RFID Research Center is a subunit of the Information Technology Research Institute within the Walton College. The center was formally approved by the Arkansas Department of Higher Education and began operating in early 2005. In September 2005, the center passed performance accreditation criteria established by EPCglobal Inc. The center is the only accredited academic EPC/RFID test center in the world.
The study is available for download at http://itri.uark.edu/research. Enter “rfid” as the keyword.
Hardgrave, holder of the Edwin and Karlee Bradberry Chair in Information Systems, is also executive director of the Information Technology Research Institute.
CONTACTS:Bill Hardgrave, professor of information systems; executive director, Information Technology Research Institute; director, RFID Research Center
Matt McGowan | Newswise Science News
Further reports about: > Business Vision > EPCglobal > Inventory > Item-Level > RFID > RFID tag > RFID-enabled > RFID-enabled system > Radio-frequency identification > Technology > business process > cycle-counting time > information systems > inventory-management system > physical-inventory figures > stocks
Mathematical confirmation: Rewiring financial networks reduces systemic risk
22.06.2017 | International Institute for Applied Systems Analysis (IIASA)
Frugal Innovations: when less is more
19.04.2017 | Fraunhofer-Institut für Arbeitswirtschaft und Organisation IAO
The formation of stars in distant galaxies is still largely unexplored. For the first time, astron-omers at the University of Geneva have now been able to closely observe a star system six billion light-years away. In doing so, they are confirming earlier simulations made by the University of Zurich. One special effect is made possible by the multiple reflections of images that run through the cosmos like a snake.
Today, astronomers have a pretty accurate idea of how stars were formed in the recent cosmic past. But do these laws also apply to older galaxies? For around a...
Just because someone is smart and well-motivated doesn't mean he or she can learn the visual skills needed to excel at tasks like matching fingerprints, interpreting medical X-rays, keeping track of aircraft on radar displays or forensic face matching.
That is the implication of a new study which shows for the first time that there is a broad range of differences in people's visual ability and that these...
Computer Tomography (CT) is a standard procedure in hospitals, but so far, the technology has not been suitable for imaging extremely small objects. In PNAS, a team from the Technical University of Munich (TUM) describes a Nano-CT device that creates three-dimensional x-ray images at resolutions up to 100 nanometers. The first test application: Together with colleagues from the University of Kassel and Helmholtz-Zentrum Geesthacht the researchers analyzed the locomotory system of a velvet worm.
During a CT analysis, the object under investigation is x-rayed and a detector measures the respective amount of radiation absorbed from various angles....
The quantum world is fragile; error correction codes are needed to protect the information stored in a quantum object from the deteriorating effects of noise. Quantum physicists in Innsbruck have developed a protocol to pass quantum information between differently encoded building blocks of a future quantum computer, such as processors and memories. Scientists may use this protocol in the future to build a data bus for quantum computers. The researchers have published their work in the journal Nature Communications.
Future quantum computers will be able to solve problems where conventional computers fail today. We are still far away from any large-scale implementation,...
Pillared graphene would transfer heat better if the theoretical material had a few asymmetric junctions that caused wrinkles, according to Rice University...
15.11.2017 | Event News
15.11.2017 | Event News
30.10.2017 | Event News
17.11.2017 | Physics and Astronomy
17.11.2017 | Health and Medicine
17.11.2017 | Studies and Analyses