UK retailer reports on achieving 100% item-level RFID adoption to enhance supply chain efficiency, increase product availability and drive sales growth
Marks & Spencer (M&S) is reporting 100% radio frequency identification (RFID) adoption across its apparel and general merchandise supply chain after having begun its initial use of the tracking technology over a decade ago.
As the largest UK clothing retailer, M&S wanted to achieve the goal of being ‘the store in which you can always find your size’. So consistent and accurate product availability both instore and online was paramount.
Traditionally, M&S relied on optical scanners to track inventory – using barcodes to scan each item within centimetres of the scanner and scanning a maximum of 400-600 items per hour. However the manual process can be prone to error, while the information gathered did not support manual restocking operational insights or rapid cycle counts.
Embarking on its RFID journey
In 2003 M&S began working labelling and packing specialist Avery Dennison
as a pilot partner for item-level RFID on clothing in its High Wycombe store near London, tagging 10,000 men’s suits, shirts and ties. Due to increased inventory accuracy during the trial, M&S quickly expanded the RFID process across apparel in 2005 and, by 2007, the technology was being used in 120 stores.
In 2012, M&S rolled out Generation 2 RFID technology across the company’s 200 top grossing stores and expanded RFID tagging to 14 clothing departments. The following year M&S expanded RFID reading to all clothing and some home ware departments in the same 200 stores, as well as procuring new RFID mobile readers to read all of the Generation 2 tags. Now in 2014, Marks & Spencer has become the first retailer to move to 100% RFID tagging for all its general merchandise in order to create accurate, holistic tracking of stock throughout its supply chain.
Working closely with M&S, Avery Dennison Retail Branding and Information Solutions
(RBIS) has developed RFID tags that are integrated into a range of labels and tickets, including self-adhesive RFID labels on promotional tickets. These have been specifically developed to ensure that M&S has suitable tags for its complete range of merchandise.
The technology company said it has to date supplied over one billion RFID tags to M&S with no data loss or duplication. In addition over 200 factories in twenty countries apply RFID tickets and labels for distribution in M&S stores. In 2014, M&S will use 400 million RFID tags, which can be read by a scanner up to a meter away, making the inventory scanning process faster and more efficient. And the retailer is planning future RFID development to cover the additional categories of jewellery, cosmetics, homeware and gifts, with implementation for cosmetics and beauty by the spring of 2015.
Assessing investment advantages
The RFID technology has helped improve the M&S customer experience, by ensuring that the right products in the right sizes are available when and where shoppers are searching for them. Kim Phillips, head of packaging at Marks & Spencer, said: “The RFID partnership with Avery Dennison has made stock counting and real-time inventory tracking faster, more efficient and more accurate, facilitating better management of stock levels and ensuring that the correct product mix is always on display. The benefits experienced by Marks & Spencer with our RFID implantation program go beyond quantifiable savings and production times, to an enhanced customer journey and seamless omnichannel experience.”
The M&S investment has also increased inventory tracking speeds by a factor of 10 compared to using traditional optical scanners. “From the beginning, the M&S RFID implementation was driven by measurable financial benefits, as well as a desire to improve customer service through greater stock availability,” added Steve Finlan, retail director at Marks & Spencer. “With the move to 100% RFID tagging, these goals have been more than satisfied. Inventory accuracy has been improved by up to 50% and out-of-stocks cut by 30-40%. What’s more, the granular level of store and department benefits detailed weekly by M&S software has proved the RFID business case many times over.”