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CONTENTS

Contents
CONTENTS.................................................................................................................. 1
INTRODUCTION........................................................................................................... 2
Technology of RFID system......................................................................................... 3
HOW COMPPONENTS WORKS..................................................................................3
Applications of RFID in fashion industry.....................................................................4
Production control................................................................................................... 4
Retail management................................................................................................. 5
RFID used in fitting room............................................................................................ 6
RFID tags for care labelling..................................................................................... 6
HOW SYSTEM WORKS IN APPAREL MANUFACTURING.................................................7
Large Apparel Retailers, Wholesalers See Sharp Rise in RFID Adoption, ROI..............7
Technical problems with RFID..................................................................................... 8
Problems with RFID Standards................................................................................. 8
RFID systems can be easily disrupted.....................................................................9
RFID Reader Collision.............................................................................................. 9
RFID Tag Collision.................................................................................................... 9
RFID Versus Barcodes.............................................................................................. 10
CASE STUDY I........................................................................................................... 11
Item-Level RFID for Apparel/Footwear: The JC Penney RFID Initiative....................11
CASE STUDY II........................................................................................................... 12
American apparel Boosts Sales 14%, Cuts Inventory Management Costs 35% with
RFID Solution......................................................................................................... 12
CASE STUDY 1.......................................................................................................... 14
INTRODUCTION
Radio frequency identification is an automatic identification technology that is
used to describe a system that transmits the identity (in the form of a unique serial
number) of an object wirelessly, using radio waves.

In the fast-paced world of fashion, success for retailers was by being able to put the right item in
the right style or size in the customers hand at the right time a simple concept that is difficult
to execute for a number of reasons. Fashion is a perishable commodity where
trendschangeovernight, making it difficult to ultimately predict duration and demand. Ordering
too much product translates into increased capital expenses that can erode a retailers bottom
line, while ordering too little can lead to missed opportunities and lost sales. Unlike other retail
segments where item shave a set location on the shelves, items do notstay in one spot.
Inventory is constantly on the move between the rack and the dressing room throughout the day,
often causing a false out- of-stock situation and a lost sale when the size a customer may need
is in the dressing room
waiting to be re-stocked. And keeping an accurate inventory is difficult and costly further
compounding the ability to ensure the right item is available for your customers at the point of
decision.

Research has shown 65% of the traditional inventories give the wrong figures due to inaccurate
methods used. And the very nature of high value merchandise that is openly accessible to
customers increases the opportunities for theft. Goods are often produced thousands of miles
from their eventual point of sale. Accurate, up-to-date information is therefore crucial to manage
worldwide supply chains successfully. In order to increase sales and reduce out of stock
situations, the supply chain, from the manufacturers through distributors to retailers, has to be
transparent and well managed.

RFID provides manufacturers with the ability to accurately track and safeguard goods
throughout
the entire supply chain to improve operating
costs.
Apparel retailers benefiting from RFID receive
real-time visibility into inventory and product
movement to reduce loss prevention, improve
store productivity and boost brand loyalty. High
levels of safety stock
excess inventory ordered to protect against
out-of-stocks
can be reduced.
Unlike bar-code technology, RFID technology does not require contact or line of
sight for communication.

A basic RFID system consists of three components:

An antenna
A transceiver (with decoder)
A transponder (RF tag) electronically programmed with unique information

Technology of RFID system

Radio frequency identification is an automatic identification method consisting of


several components such as tags, tag readers, edge servers, middleware, and
application software. Among these the three important components are RFID tag
(also known as transponder), RFID reader (also known as transceiver or
interrogator) and software for data processing. An RFID tag is a small object that
can be attached to or embedded into a product, animal, or person. It consists of a
tiny chip where the data is stored and an antenna to enable it to receive and
respond to radio-frequency queries from an RFID transceiver. The tags contain
electronic product code (EPC) and the information related to the product like the
name of the company, batch and year of manufacturing, price etc.

(REF: http://link.springer.com/article/10.1186/s40691-015-0034-9)

HOW COMPPONENTS WORKS


The antenna emits radio signals to activate the tag and to read and write
data to it.
The reader emits radio waves in ranges of anywhere from one inch to 100
feet or more, depending upon its
power output and the radio
frequency used. When an RFID tag
passes through the electromagnetic
zone, it detects the reader's
activation signal.
The reader decodes the data
encoded in the tag's integrated
circuit (silicon chip) and the data is
passed to the host computer for
processing.
Applications of RFID in fashion industry

.A range of problems unique to fashion industry can be solved by installing the RFID
system in various processes involved in fashion supply chain. Fashion industry can
be divided into four sectors such as manufacturing, overseas transportation,
distribution and retailing. In manufacturing RFID can be used to avoid product and
component mixing, and mixing of different accessories. In overseas transportation
RFID can be used to track and trace the consignment before and after Free on
Board, if product is outsourced. RFID primarily can solve the issue of sorting and
tracking the product very quickly, thus reducing the lead time during distribution. In
majority of the retail shops, the space is a constraint, which needs to be used
efficiently. RFID is used to manage the stock to identify the item quickly and
correctly so as to avoid search regret, and thus help to solve the problem.

Inventory management
The use of RFID system assists in better inventory management and enhances
customer shopping experience. The RFID system can indicate the type of clothing
selling faster or slower, which provide customized advertisement on picked clothes
according to the RFID tags. The RFID use also helps in reducing labour. For example,
American Apparel applied RFID system in eight of their stores, which saved about
6080 h per week in labor and reduced out-of-stock products owing to unawareness.
Similarly, the Japanese apparel manufacturer Sankei is using a RFID system in
manufacturing to track clothes during the manufacturing process in addition to the
online sales.

A successful case study has been conducted by Kaufhaulf departmental store in


Europe on the impact of RFID on their processes and supply chain. They have
concluded that RFID can be used in warehousing to track the goods and assist in
cross docking operation as the goods received are not segregated in the warehouse
but stored as they are received from the manufacturer. In the distribution centers
receivable area RFID readers can be implemented to track the goods as they come
in. The received goods are registered and the data stored on RFID transponders can
be read for each good though received in pallets or individual fashion item on
hanger. In this the task of counting hangers, items and pallets can be eliminated
and quantity can be controlled up to 100% satisfaction level.

Production control
Inside the stores of the production department the stock level can be quickly
monitored which helps in a real-time and efficient inventory management. The
location and movement of the components, semi-finished and the finished products
can be detected by the RFID system, which helps in production monitoring and
control. The performance of departments and the individuals can be evaluated by
the rate of movement of the garment components from the departments or
individuals. This helps in improving the productivity and the quality. In the packing
floor the mixing of different styles and sizes can be avoided by RFID tags. Also the
number of pieces in packed cartons can be counted without opening, which saves
the time and labour.

Retail management
It can be used in retail to monitor and control the floor level out-of-stocks (OOS). It is
mostly required where there is high product display density, low staffing level and
chances of mishandling is very high. The stock level of the items is properly
maintained and the items can be grouped according to their demand. Similarly,
while receiving the goods at the store the accuracy of the deliveries can be ensured
quickly with less labour. This can improve the inventory accuracy and automatic
replenishment of stock. Mostly the retailers verify the accuracy and integrity of the
shipment by open-box audit prior to stocking or storing of goods. But now it is
possible to read all the items packed inside the carton without opening, which saves
time and labour cost. So the RFID provides a new horizon to the retailers in
receiving of materials, which eliminates the invoice disputes, mixing of different
quality products etc.

The RFID has been used by number of major retailers in Europe and USA. Walmart is
among the early adopters of RFID throughout their supply chain and the suppliers
working with Walmart had been under pressure to implement RFID in their supply
chain component as well. The reason of implementing RFID is line with Walmarts
corporate strategy of being cost competitiveness and faster response. After
successfully implementation and use of RFID by Walmart, other big retailers like
Marks and Spencer and Tesco in UK are adopting it, Coles group in Australia have
given a thought of embracing this technology. Fashion industry is always regarded
as the late adopter of new technology than others, but in adopting RFID it is not
lagging behind.

The theft of garments from the fitting room can be prevented by mounting a small
reader at the entry point of the room. The tag information of the garment is
captured when the customer takes the garment to the fitting room. The items that
are taken to the fitting room but not come out are reported as potential loss items.
So the RFID can be used to identify the missing merchandise and prosecution of the
shoplifters. In addition, the dislocation of the clothes is automatically detected and
customers can be given advice on the fitting of the clothes they are trying on. The
later task can be achieved by the use of smart try-out cabins and smart mirrors. The
smart mirror can advise on additional clothing and fashion accessories. Companies
such as Marks and Spencer, Levi Strauss & Co. are installing RFID to acquire data on
the amount of stocks every day so that the stock can be replenished. However,
significant difference was observed between the data received from the RFID
systems and the actual inventory levels.

The store merchandise recovery and replenishment process presently used is


completely manual, unsystematic and ineffective. Also it requires a very long time
and high labour force and some popular items are not replenished for weeks. This
can be overcome by RFID technology. The tags help to estimate the stock level
frequently and there is an in-stock position improvement up to 30%. This has a
positive impact on sales and customer satisfaction. It prevents the fashion or the
seasonal merchandise to lie undetected in the back room and to be sold at
significant markdowns thus improving the profit margin.

Also at the point of sales the RFID tag can be read quickly and it avoids the physical
handling of the product as in barcode system. The RFID tags can be placed at the
side seams or hem or in a paper cartoon label without affecting the aesthetic appeal
of the garment. The number of items sold is automatically adjusted from the
amount of stock. Hence, the customers can be informed about the status/stock of
merchandise by interactive display screens. The use of RFID tags has helped to
reduce the out of stock rate of Wal-mart by 16% and RFID enabled stores were 63%
more effective in replenishing out-of-stocks than control stores.

RFID used in fitting room


Radio frequency identification technology is used in the fitting room in a new
approach by a German departmental store Galeria Kaufhof in Essen, (part of the
Metro retailing group). Automatic suggestions are provided to men buying clothes in
the store when they go to a dressing room to try a suit. A smart mirror informs
them what kind of suit or accessories will be appropriate. An RFID reader on the
smart mirror in the fitting room determines which clothing has been brought into
the room from the RFID tag attached to the apparel. The appropriate accessories
are then displayed on a suitable interface. This system is used in combination with
smart shelves, which can read what merchandise is currently in stock, so that
customers can be shown various styles and sizes that are available.

RFID tags for care labelling


The recent care labels are printed or woven labels storing a limited information. The
electronic labels use RFID tags for storing information electronically on a garment.
The same RFID tag used for containing the product details at the point of sale
cannot be used for storing the wash care instructions, due to the privacy concerns.
Hence, additional tags are needed for the wash care instructions, which will increase
the cost of the garment. In addition, the consumers need special readers to extract
the information stored in the RFID tag. Hence, they will prefer the physical label
instead of an electronic label. Furthermore, the use of RFID tags in the garment,
may pose health risks to the consumers due to the exposure to radiation.

The other concern related to the use of RFID tag is the electronic waste. An
appropriate method should be devised to recycle or reuse the RFID tags, if they are
removed at the point of sale. Similarly, if customers remove the chip at some point,
proper disposal of the tags is essential, which causes additional worries to the
companies. In addition, the other issues related to RFID are the lack of
standardisation and high cost. Standardising the technology, design and use of the
tags can solve the issues related to lack of standardisation, whereas the
technological developments can help to overcome the cost related issues.
HOW SYSTEM WORKS IN APPAREL MANUFACTURING
Large Apparel Retailers, Wholesalers See Sharp Rise in
RFID Adoption, ROI
The rate of adoption for radio frequency identification in the retail apparel, footwear and
accessories market has more than doubled during the past two years, according to a
survey of 60 European and U.S. retailers and wholesalers, conducted by management
and strategy consulting firm Kurt Salmon. The company's first large retail study, carried
out in 2014, found that 34 percent of respondents had either implemented or were
currently implementing or piloting RFID. When Kurt Salmon conducted a similar survey
two years later, in May 2016, that rate grew to 73 percent. Of the 16 respondents not
using RFID, 86 percent indicated that management at their company was focused on
other priorities, while only 2 percent felt that RFID would not provide substantial
benefits.

Technical problems with RFID

Problems with RFID Standards


RFID has been implemented in different ways by different manufacturers; global
standards are still being worked on. It should be noted that some RFID devices are
never meant to leave their network (as in the case of RFID tags used for inventory
control within a company). This can cause problems for companies.
Consumers may also have problems with RFID standards. For example, ExxonMobil's
SpeedPass system is a proprietary RFID system; if another company wanted to use
the convenient SpeedPass (say, at the drive-in window of your favourite fast food
restaurant) they would have to pay to access it - an unlikely scenario. On the other
hand, if every company had their own "SpeedPass" system, a consumer would need
to carry many different devices with them.

RFID systems can be easily disrupted

Since RFID systems make use of the electromagnetic spectrum (like WiFi networks
or cellphones), they are relatively easy to jam using energy at the right frequency.
Although this would only be an inconvenience for consumers in stores (longer waits
at the checkout), it could be disastrous in other environments where RFID is
increasingly used, like hospitals or in the military in the field.
Also, active RFID tags (those that use a battery to increase the range of the system)
can be repeatedly interrogated to wear the battery down, disrupting the system.

RFID Reader Collision

Reader collision occurs when the signals from two or more readers overlap. The tag
is unable to respond to simultaneous queries. Systems must be carefully set up to
avoid this problem; many systems use an anti-collision protocol (also called a
singleton protocol. Anti-collision protocols enable the tags to take turns in
transmitting to a reader. (Learn more about RFID reader collision.)

RFID Tag Collision

Tag collision occurs when many tags are present in a small area; but since the read
time is very fast, it is easier for vendors to develop systems that ensure that tags
respond one at a time.
Security, privacy and ethics problems with RFID

(REF: http://www.technovelgy.com/ct/Technology-Article.asp?ArtNum=20)
RFID Versus Barcodes
CASE STUDY I
Item-Level RFID for Apparel/Footwear: The JC Penney RFID
Initiative

INTRODUCTION

In this particular study, item-level RFID tagging and physical inventory counting was
investigated in situ, primarily to determine the effect of item-level tagging on inventory accuracy,
which is known to cause other problems, such as out of stocks. Overall, the results can be used to
provide guidance to companies as they investigate whether, and to what extent, to implement
RFID.

RESEARCH METHODOLOGY

To investigate item-level RFID use cases, five stores were chosen: two RFID-enabled
stores and three control stores. Two departments bras (national and private brands) and shoes
(womens, mens, childrens, and athletic) were examined in this study. Each test stores bra
and shoe department was analyzed against a control department that was selected from one of the
control stores.

RESULTS

Inventory Accuracy
The baseline data for JCPenney had unusually high inventory accuracy percentages (far
above the industrys average of 65%). Because of the high initial accuracy, drastic improvements
to accuracy were not expected. However, at the conclusion of the pilot, it became clear that even
retailers with high starting inventory accuracy numbers can stand to gain from implementation of
RFID.
CASE STUDY II
American apparel Boosts Sales 14%,
Cuts Inventory Management Costs 35%
with RFID Solution

Like virtually all retailers and all businesses, American


Apparel wanted to do more with less at its retail
locationsspecifically, it wanted to boost store sales
while reducing the cost of generating those sales. It met
that goal with a solution provided by Xterprise, a
Microsoft Gold Certified Partner, and based on Microsoft
BizTalk Server RFID. Radio frequency ID (RFID) tags and
readers help employees to get needed merchandise on
the retail floor faster than before. As a result, store sales
are up 14 percent, margins are up to 65.9 percent, and
the labor time and costs spent on handling inventory
are down by 35 percent, resulting in better-organized
backroom management. American Apparel sees the
technology as the first step in an integrated solution
that slashes shrinkage and increases customer service,
and it is already using the solution to make better
decisions in real time.
APPENDIXES

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