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Build efficient loss prevention with RFID

WRITTEN BY 16. April 2021January 20th, 2022No Comments

Many store owners experience loss in revenue due to inventory shrinkage. The disappearance of items is typically detected when the stock count does not match or if the alarm sounds in the store. With RFID, you can effectively prevent shrinkage and identify blind spots in the warehouse and in the store.

Traditional alarm systems make you neither smarter nor richer

Theft in retail stores has been a problem for mange retailers for a long time. To put an end to the thefts, most stores use traditional alarm systems, where the alarm tag on the clothes triggers an alarm when the item leaves the store. However, the beep and howl from the alarm are often ignored — which means lost revenue for many store owners.

The challenge with the traditional alarm system is that it does not collect information about which items are disappearing or how they are moved around in the store before their disappearance. The lack of insight makes retailers vulnerable and threatens their profitability.

Loss prevention with RFID technology

An alternative to the traditional alarm tags on clothing for loss prevention is the use of RFID technology. RFID (Radio Frequency Identification) is used for inventory management and to identify items and their location. The technology is controlled by radio waves that communicate between a tag on the item and the RFID reader. RFID technology identifies the location and number of specific items in record time. See how loss prevention with RFID works in a store in the illustrations below.

This is how loss prevention with RFID works

Wam Denim RFID tags production in Turkey
1. Tag your items

Provide your items with RFID tags. To maximize ROI the solution can also deliver data to your inventory management system.

Wam Denim RFID tags on warehouse
2. Read the tags

RFID readers placed overhead, on walls, or at exits identify the tagged items. Items that are not directly visible are also identified.

Illustration of RFID tracking of items in store
3. Follow your items

Connect the data with loss prevention, which alerts staff when unsold items leave the store. The data also enables advanced loss prevention.

Prevent inventory shrinkage by identifying patterns

With RFID for loss prevention, you can go from reactive to proactive with a greater insight into details about shrinkage and theft. When you know where each item is in the store and how it moves you can effectively prevent shrinkage. In addition, you are able to get notifications on the POS when people leave the store with unpaid items.

By knowing the location and movement patterns of each item, you gain insight into potential blind spots and details of the theft. Is it typically close to the end of the store that items disappear? After the items have been in the fitting room? Or are the unpaid items in the bag of paid items when customers leave the store? As you become wiser about your data, you can more easily initiate initiatives that address the root of the problem.

Kasper Højdal

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