Is RFID our best bad idea for in-store fulfillment?
Through a special arrangement, what follows is an excerpt of an article from FierceRetailIT, a digital publication covering the latest retail technology news and analysis.
The role of the store is changing in the new omni-channel order, but the technology needed to fuel it is still underutilized. Case in point, RFID and in-store fulfillment for online orders.
There’s a scene in the movie "Argo," where the characters played by Ben Affleck and Bryan Cranston are explaining their plan to rescue six U.S. diplomats from Iran as the hostage crisis played out. The plan is ridiculous — to pose as a movie crew looking for exotic locations to film a sci-fi flick — while the group hiding at the Canadian ambassador’s home is spirited away.
A few other plans, including riding bicycles through the mountains in winter, were explored but the movie crew was the one pushed. The conversation went:
"There are only bad options. It’s about finding the best one."
"You don’t have a better bad idea than this?"
"This is the best bad idea, sir. By far."
I was reminded of this exchange after spending a couple days with supply chain executives and vendors, where the main topic of conversation was how to handle online orders fulfilled at, or returned to, physical stores.
For retailers, the complications and potential disruptions around Buy Online, Pick Up In-Store (BOPIS) are many.
Imagine the scenarios. A shopper accesses item availability in the store’s inventory through the digital tool. She places the order, effectively reserving the item, and heads out to the store to pick it up. Before it can be picked and packed, another shopper buys it. Maybe it was in the checkout line at the time she clicked "buy."
Or maybe there was an internal system error, or the item was lost to shrink. And what happens if the item is reserved by two people online, and the orders get crossed?
What about staffing? How do stores allocate labor to pick and pack orders? Who gets credit for the sale, and who gets dinged for the return?
Many solutions are being tested and in some cases implemented, but one keeps coming up: RFID.
So far, the costs of chain-wide implementation paired with vendor compliance benefits of RFID have outweighed much of the benefits. But the needs of BOPIS may finally tip that equation in RFID’s favor.
RFID tags and readers will make finding an item ordered online easier, reducing store labor. The accuracy will reduce the risk of dissatisfied customers, and the replenishment options reduce out-of-stocks, overburdened systems and human error.
One thing is for sure: BOPIS is here to stay. Using stores as fulfillment centers offers retailers a way to utilize existing resources to capture incremental sales. RFID may well be our best bad idea.
What do you see as the most difficult execution challenges around BOPIS? Could RFID help retailers overcome many of the complications and hurdles around BOPIS?