Making shopping easier and more convenient is a goal shared by retailers and customers alike. Today's retailers stand at the forefront of a truly revolutionary technology that places the retail industry at the cusp of a new era.

................................................................................................

Radio frequency identification (RFID) may very well represent a competitive imperative for retailers. It's ability to help reduce cost, improve customer satisfaction, increase efficiency in supply chain management, improve security and control inventory loss is immediate and measurable.

The advent of "smart shelves" equipped with RFID readers may be one great stride toward bringing consumers and products together. Currently being tested and refined by Gillette and Wal-Mart, these units scan the contents of store shelves and alert retail employees when supplies are running low or when an item has been stolen. Procter & Gamble is running similar tests involving cosmetic products. The inside track is that the "smart shelving" won't be accessible to most retailers until mid-2005. However, this technology has some retailers building business cases for it use. One of the most notable benefits of smart shelves is around the need for tightened product placement and merchandising to create shopping environments that are attractive to customers because the merchandise they need is always available and in plain sight.

Regardless of the application, establishing an effective RFID infrastructure is a critical hurdle most retailers are trying to clear. This infrastructure provides real-time determination of product availability and movement, enabling dramatic improvements in operational efficiency, customer service, and profitability. Experts agree, that RFID promises the most benefit in accurate allocation and replenishment, which yields better in-stock positions and lower inventories. Retailers that have moved beyond the conceptual beginnings of exploring how RFID technology might impact their businesses include leaders such as Prada, Benetton, and Wal-Mart; whom are already testing, piloting, and rolling out this type of RFID functionality.

By 2006, a significant percentage of retailers will have embraced RFID infrastructures. However, as with any technology implementation, derived benefits occur incrementally over time. The consensus among leading retailers is that RFID will someday be as ubiquitous as the barcode and retailers who begin to plan for it early will capture specific operational benefits earlier. Better management of in-stock levels and elimination of labor inefficiencies are just two examples of many that can be easily translated into improvements to the bottom line quickly. RFID-enabled retailers will find themselves in a position to exploit these benefits to claim market share at the expense of their competitors.

It's important to run pilot tests to get some valuable insights as soon as possible. Understanding the benefits of RFID and initiating the strategic planning required to incorporate it into your organization are the first steps to leveraging the technology.

• Our team understands the actual technical capabilities and architectural requirements to use RFID effectively at the retail level.
• RFID Systems also has strategic alliances with leading retail hardware solution providers to ensure that our systems provide the best long-term results.
• Our extensive experience can help retailers build a business case for the use of RFID, and then help them work toward the implementation of this business plan.
• We know what other retailers have learned in their pilots and trials of RFID - greatly shortening our clients' learning curve.