Macy’s Pledging Item-Level RFID Chain-Wide By 2013

Written by Evan Schuman
September 28th, 2011

Macy’s on Wednesday (Sept. 28) pledged an aggressive chain-wide RFID rollout, promising to item-level tag some 700,000 UPCs in every Macy’s and Bloomingdale’s by the end of 2013. That will represent about a third of all of the $25 billion chain’s products and one of the most aggressive retail item-level deployments yet.

Macy’s won’t be tagging any of the replenishment goods directly, leaving that task to its suppliers, who will ship products to Macy’s already tagged. This massive item-level selling-floor-to-the-stockroom project began as a pilot at the Bloomingdale’s New York SoHo, which is a pilot-friendly place apparently—the chain is now using Bloomingdale’s SoHo to test Google Wallet. As a practical matter, this rollout will give Macy’s a wide range of technology options as the potential of full item-level RFID gets closer. But Macy’s is officially focused fully on just one RFID function: faster and more accurate inventory.

The passive tags, being manufactured by Avery Dennison and Tyco using chips from Impinj, can be read from three to six feet away, said Bill Connell, Macy’s Senior VP of logistics and operations. The chain won’t be using any stationary readers. Instead, it will use handheld gun readers to scan around the fixtures.

Connell stressed that improved accuracy—and much faster product replenishment—is the big payback. “The speed and accuracy is far beyond what we know we can do with a laser reader,” he said. “I did a rack myself, where I knew what the count was and I got a 100 percent in one pass around the fixture.” Typically, Connell said, he’s expecting to see a boost from the typical 90 to 92 percent accuracy of barcode scans to the “very high 99s” with the RFID item-level approach.

With all of the various potential item-level functionality, it would be easy to get distracted, which is why Connell is trying to not even consider future possibilities. “The only use case we’re thinking about is replenishment. We’re going to just be focused on accomplishing that,” he said. “We’ve got to have the discipline to execute this [replenishment] use with a high degree of effectiveness.”

That said, as the rollout hits each store, those associates will immediately have some new capabilities. Consider a customer who is desperately trying to find a specific style garment in a specific size. POS says it’s in stock and out on the floor, but the customer and associate can’t find it.

If the associate can get his/her hands on one of the RFID scanner guns—”a typical store probably needs somewhere between six and eight of these things,” Connell said—then the associate can use a Geiger Counter feature to quickly search for the garment anywhere on the floor, which is especially useful if an earlier customer placed the garment wherever he/she felt like it.


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