Wall Street Journal, March 2023 – Improving technology, lower costs and e-commerce demands are leading some merchants to beef up efforts to track individual items on the sales floor using RFID chips.

Apparel retailers are taking their inventory-management systems to the sales floor as they look to track individual items more closely through busy environments and fulfill more online orders through stores.

Apparel sellers American Eagle Outfitters Inc., Victoria’s Secret & Co. and Nordstrom Inc. are among merchants expanding their use of a new generation of radio frequency identification, or RFID, chips to close an information gap in supply chains that grows as consumers try on and move merchandise around a store. 

Retailers have long used RFID technology in tracking systems for containers, pallets and crates of goods, but high costs and limited technology have made tracking individual pieces difficult. That has left stores to take full stock of inventories at designated times, often when shops are closed.  

Companies say the technology has advanced and the cost of the chips has come down enough that tracking individual items within a store makes more sense. Executives said tracking at the item level gives them better insight into customers’ shopping habits, helps stores fill orders more quickly and allows store workers to save time when searching for merchandise.

The stakes in tracking have grown as e-commerce business has boomed in recent years, including a boost in online sales during the pandemic. Many retailers are trying to avoid the higher costs of creating separate supply chains for store sales and another for online customers by using their stores as virtual distribution centers and offering services such as buy online, pick up in store.

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