Scandinavian clothing company Moods of Norway (MoN) has equipped 13 of its stores with radio frequency identification technology to better manage its inventory. This deployment follows a six-month pilot that boosted sales at two stores—not only sales of tagged items, but also of other products as well. A 14th store is set to go live with the technology later this year.
During the two-store pilot (which consisted of tagging men’s shirts and suits, and using a handheld reader to conduct inventory counts on the sales floor), the system not only provided 98 to 99 percent inventory accuracy, but also reduced the amount of labor employees spent performing manual inventory checks, thereby enabling more frequent checks. Those results, says Hans Petter Hübert, Moods of Norway’s supply chain manager, were so impressive that the company is now investigating ways in which to expand its RFID usage beyond inventory tracking on the sales floor. The clothing firm is testing a fixed reader at the front entrance of one pilot store for the purpose of electronic article surveillance (EAS), and plans to install fixed readers in stores’ back rooms to provide employees with a tool to support replenishment from the storeroom to the sales floor.
Hübert says he had been aware of RFID technology and how it could be used for retail inventory management. At a GS1 conference held last year in Oslo, he began a conversation with Dutch technology firm Nedap about testing a solution. RFID technology, Hübert says, «is a no-brainer for a company like ours,» which aims to replenish 70 percent of the items it sells as soon as any of those products are sold, and thus requires high inventory accuracy in order to ensure goods are replenished correctly. If replenishment does not occur, customers cannot purchase those items, resulting in a loss of sales revenue.
The company also wanted to add features enabling it to provide pick-up options to its online customers. Currently, online buyers of MoN products cannot visit a nearby store to pick up purchased goods, Hübert says, in part because the company needed a way to ensure that inventory accuracy is strong enough that it can guarantee every product will be available for each customer as he or she arrives. Since the firm had what it believes to be only 75 or 80 percent inventory accuracy, it could not be as confident as it needed to be that the goods would be available in the store when needed. The average industry-wide stock accuracy is below 70 percent, he says, so he believes that MoN had been doing better than many stores—but not accurately enough for management’s liking.
In January of this year, MoN began testing a Nedap solution consisting of its handheld !D Hand reader, an Apple iPod Touch loaded with Nedap software, and a cloud-based server that hosts software for managing all collected read data that the iPod receives from the reader, via a Bluetooth connection. Nedap’s Norwegian partner, Infratek, provided and installed the technology.