Monday, June 13, 2011

Out-of-stock items: an issue addressed by RFID

Inventory control can be a tedious exercise for employees, and it can result in frequent errors.  But, the lack of a good inventory control system means the seller may not have a good handle on what he needs to stock and how many of the item he needs to keep on hand.

And, one of the worst things for a retailer is to have a customer leave empty handed because the seller was out-of-stock on a desired item.
 
One study says that 20% of shoppers of electronics equipment end up leaving the store without buying anything because the item they want is out-of-stock.  This translates into a $430 billion annual loss for retailers. 

The study also states that resolving this issue would increase overall sales by 10%.

Wal Mart, Kohl's, Dillard's and others are aggressively addressing this problem using RFID.  Placing a tag on each item, rather than conducting manual inventory tracking, will help eliminate or greatly reduce the losses from out-of-stock goods.

A summary of the study can be found here:  

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