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New report shows RFID increases retail sales by up to 5.5%

London, 22 February 2018 – Research supported by GS1 UK, the supply chain and data standards organisation, has found that retailers could boost their sales by as much as 5.5% by using radio-frequency identification tags (RFID).

The independent research report, commissioned in partnership with ECR Community’s Shrinkage and OSA Group and produced by Professor Adrian Beck of the University of Leicester, is understood to be the world’s most comprehensive study into the use of RFID in retail.

'Measuring the Impact of RFID in Retailing finds 100% of retailers surveyed saw a positive ROI from implementing RFID.

The report focuses on the key learnings from ten global retailers and brands1 that have invested in the technology. Using a combination of face-to-face interviews coupled with quantitative data on business performance Professor Beck’s research identifies the key lessons from their journeys with RFID.

Quantified commercial benefits from studying these ten retailers and brands include:

  • All companies achieved a positive ROI for their business as a result of using RFID.
    • All retailers reported an increase in sales between 1.5% -5.5% through improved stock availability – contributing between €1.4 and €5.2 billion to their businesses.
    • Inventory accuracy improved by over 50% with retailers reporting 93-99% accuracy with RFID.
    • Six of the ten2 companies were able to reduce total stock holding between 2-13%.

Other important learnings from the study highlight the approach that businesses should adopt when planning their implementation of RFID:

  • Using industry standards – all ten companies believed that using standards supported an easier RFID implementation and broadened the network of technology providers.
  • Integration must be taken seriously and considered early on in the process – integrating new RFID data with existing systems was the biggest challenge reported by the companies
  • Using external help – virtually all brands benefited from external help to deliver their RFID plans and implementation including technical solution providers, consultants and the GS1 system.

Marks & Spencer, who have pioneered the use RFID in the UK, were one of the ten companies that took part in the research. Richard Jenkins, Head of RFID and Loss Prevention at Marks & Spencer commented: “'We were pleased to be asked to participate in such a comprehensive and thorough study into the state of RFID in Retail today. This exciting technology innovation for retailers is often misunderstood and shrouded in mystery. Hopefully this new report will dispel some of the myths and provide valuable new insight to assist all of us that are on the RFID journey.”

John Fonteijn, Group Chairman from the ECR Community Shrinkage and On-Shelf Availability Group, said: “We are delighted to have the opportunity to co-sponsor this exciting and innovative research project. As a technology, RFID has often struggled to live up to the hype surrounding its use in retailing, but as Professor Beck’s research shows, in the right environment, and by adopting a realistic and measured approach to its use, RFID now offers an attractive financial proposition to those retailers willing to invest.”

Gary Lynch, CEO GS1 UK, added: “This independent research highlights the clear commercial and operational benefits and challenges for both retailers adopting RFID within their businesses. As owners of the EPC industry standard for RFID, GS1 UK is able to offer neutral advice to help retailers and solution providers on their RFID journeys. The learnings covered in this report provide an indispensable guide for any retailer interested in deploying the technology.”

1 Participating companies are: Adidas, C&A, Decathlon, LuluLemon, Jack Wills, John Lewis, Marc O’Polo, Marks & Spencer, River Island and Tesco

2 The remaining four companies were not prepared to share this information.

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About GS1 UK

For further information or requests for interviews, please contact Tim Haidar: 020 7092 3584 / Tim.Haidar@gs1uk.org.

GS1 UK is a community of over 33,000 members working in retail, foodservice, healthcare and more. GS1 UK is one of 112 independent, not-for-profit GS1 organisations operating across 150 countries worldwide. GS1 UK helps everyone involved in making, moving and trading goods, automate and standardise their supply chain processes using the common language of GS1 global standards.

www.gs1uk.org