( This article is excerpted from the report The Rapid Road to Value for RFID in Retail, available for download here. )
In part one of this series, we discuss potential use cases for retailers implementing RFID and criteria to select the best place to start. Here in part two, we look at the choices in RFID Reader Infrastructure.
RFID Reader Hardware Infrastructure: Sorting Through the Choices
Once a retailer decides on a compelling use case, s/he will select a solution provider and solution components, which includes RFID tags, readers, and software. While not a focus of this paper, there are many important decision points for both tags and software. For example, the decision on tags includes whether to use a paper tag vs. a hard tag (which may be integrated with an EAS tag) vs. a sewn in tag. Choosing the right software application requires an evaluation of many other factors — functional footprint, integration capabilities, user experience/ease-of-use, cloud vs. on premise, and so forth.
While these are vital system solution components, it is just as critical to select the appropriate reader infrastructure. The choice of readers is a foundational decision, impacting business processes (such as how inventory is taken), costs, performance, flexibility, the types of benefits you can achieve, and how quickly you can achieve those benefits. There are a variety of choices when it comes to the reader infrastructure, including:
Handheld RFID readers — These are similar to handheld barcode scanners, except they can identify and count items much faster (25X or more) by using RFID to read many items at once without the need for line-of-sight to the tag. This is the most proven and widely used RFID reader type in retail today, with the lowest upfront capital cost. However, handheld readers drive processes that are managed by store associates, and thus have a higher ongoing labor cost and require training and monitoring to ensure compliance. Many handheld readers integrate a powerful mobile computer and barcode scanner along with the RFID reading capability, well-suited to enable a phased incremental transition from barcode-based processes to an RFID-based process at a pace best for the retailer. In this way, handhelds can be a very flexible tool for multiple store processes;1- Fixed Readers for Transitional/Zonal use — Retailers may install fixed readers and antennas at strategic transitional chokepoints in the store, such as the doorway between the front and back of the store or at the customer and employee exits. These automatically read any tags going through the read zone, and can be useful to track the movement of inventory between the different ‘zones’ of the store (e.g. from the backroom to the showroom floor). Fixed readers can also be used in the supply chain: mounted around the dock door in a DC or back-of-store receiving operation to automatically read items being loaded onto or unloaded from a truck at that door, or mounted along a conveyor belt to read items moving past on the conveyor. They were also used in early deployments in changing rooms to monitor conversion rates. Once installed they require little maintenance and can be an important element of the store’s inventory optimization strategy;
- Tabletop, POS Readers — These readers come in two form factors. The first is a stationary tabletop barcode scanner/RFID reader which can sit on any table or POS surface. This form factor ensures that items can be identified regardless of which data capture standard (RFID or barcode) is utilized on the item tag. Alternately, retailers can use an RFID-only form factor that can sit on or be mounted under any table or counter. These can be used to verify that the correct items are being packed or received, or for ringing up a customer’s order at point of sale. Neither of these use cases are yet widespread in retail, but there
has been some recent activity in RFID at checkout;2 - RFID enabled Kiosks, Interactive Mirrors — Kiosks may have built-in RFID readers that serve multiple purposes, such as supporting the shopper or store associate with price checks, checking availability of different sizes and colors, finding related merchandise, checking a specific item’s origin, and the ability to display other in-depth product information. A variation is the self-help kiosks in dressing rooms and ‘Magic Mirrors’ that show the shopper what various items will look like on them. They may also allow the shopper to call for an additional size, pull up customer loyalty information, and finally conclude the sale and process payment, all without leaving the dressing room. To date, RFID-enabled kiosks and magic mirrors have not been widely rolled out;
- Overhead ceiling-mounted readers — These are typically mounted in or hanging from the ceiling. They can be arranged to illuminate3 the whole store, or selected areas or departments. Overhead readers provide the ability to continuously read items and determine the location of the item, without requiring any human labor. This allows for a whole new set of powerful use cases and applications that we explore later in this paper. This technology is newer and still evolving. Few retailers have deployed overhead readers, although a number of companies are testing, and we are starting to see some pilots;
- Robots and drones – new approach in early stages of development involves mounting an RFID reader to a drone or robot that autonomously moves throughout the retail space and takes inventory by reading all of the tags, typically at night when the store is closed. These devices are more speculative than the others previously mentioned and are only now making their way into early stage proof-of-concept projects.
Handheld RFID readers — These are similar to handheld barcode scanners, except they can identify and count items much faster (25X or more) by using RFID to read many items at once without the need for line-of-sight to the tag. This is the most proven and widely used RFID reader type in retail today, with the lowest upfront capital cost. However, handheld readers drive processes that are managed by store associates, and thus have a higher ongoing labor cost and require training and monitoring to ensure compliance. Many handheld readers integrate a powerful mobile computer and barcode scanner along with the RFID reading capability, well-suited to enable a phased incremental transition from barcode-based processes to an RFID-based process at a pace best for the retailer. In this way, handhelds can be a very flexible tool for multiple store processes;
Fixed Readers for Transitional/Zonal use — Retailers may install fixed readers and antennas at strategic transitional chokepoints in the store, such as the doorway between the front and back of the store or at the customer and employee exits. These automatically read any tags going through the read zone, and can be useful to track the movement of inventory between the different ‘zones’ of the store (e.g. from the backroom to the showroom floor). Fixed readers can also be used in the supply chain: mounted around the dock door in a DC or back-of-store receiving operation to automatically read items being loaded onto or unloaded from a truck at that door, or mounted along a conveyor belt to read items moving past on the conveyor. They were also used in early deployments in changing rooms to monitor conversion rates. Once installed they require little maintenance and can be an important element of the store’s inventory optimization strategy;
Tabletop, POS Readers — These readers come in two form factors. The first is a stationary tabletop barcode scanner/RFID reader which can sit on any table or POS surface. This form factor ensures that items can be identified regardless of which data capture standard (RFID or barcode) is utilized on the item tag. Alternately, retailers can use an RFID-only form factor that can sit on or be mounted under any table or counter. These can be used to verify that the correct items are being packed or received, or for ringing up a customer’s order at point of sale. Neither of these use cases are yet widespread in retail, but there 
RFID enabled Kiosks, Interactive Mirrors — Kiosks may have built-in RFID readers that serve multiple purposes, such as supporting the shopper or store associate with price checks, checking availability of different sizes and colors, finding related merchandise, checking a specific item’s origin, and the ability to display other in-depth product information. A variation is the self-help kiosks in dressing rooms and ‘Magic Mirrors’ that show the shopper what various items will look like on them. They may also allow the shopper to call for an additional size, pull up customer loyalty information, and finally conclude the sale and process payment, all without leaving the dressing room. To date, RFID-enabled kiosks and magic mirrors have not been widely rolled out;
Overhead ceiling-mounted readers — These are typically mounted in or hanging from the ceiling. They can be arranged to illuminate
Robots and drones – new approach in early stages of development involves mounting an RFID reader to a drone or robot that autonomously moves throughout the retail space and takes inventory by reading all of the tags, typically at night when the store is closed. These devices are more speculative than the others previously mentioned and are only now making their way into early stage proof-of-concept projects.Figure 1 below shows the different reader approaches covering a range of levels of current maturity and cost.
The y-axis in Figure 1 shows the approximate relative capital costs (total cost of infrastructure, not the cost per device) and time required for implementation for the different reader infrastructure types. The x-axis shows the approximate date at which each technology reached or is expected to reach maturity. In the context of this diagram, ‘maturity’ means that the technology has been used widely enough within a retail setting so that:
- most retail-specific issues have already been encountered, understood, and resolved;
- a critical mass of people with expertise in the technology has been built up;
- a critical mass of mature solutions (software infrastructure and applications) has been created for use with that specific technology in retail settings;
- a collective knowledge has been amassed of the process changes and requirements (e.g. store associate training and compliance monitoring in the case of handhelds) needed for effective rollout and realization of value.
By these criteria, handheld RFID readers are the most mature within retail, having reached widespread use several years ago, and require the least up front capital expense and technology implementation time and effort. Fixed RFID readers for door portals and zonal reads are starting to be used more in retail,4 typically in combination with handheld readers. They can cost more than handhelds, but less than covering an entire store with overhead ceiling-mounted readers. Overhead readers to cover the whole store or sections of the store are receiving a lot of attention right now and there are a few retailers in pilots or very early stages of rollout. We expect it will take a couple more years before overhead readers reach maturity in retail settings, but their potential to cost-effectively automate and transform existing handheld-based processes is significant.
Besides maturity and cost, there are other key differences between these infrastructure technologies, such as how ‘real-time’ the data is, the amount of associate labor and training involved, flexibility when store layouts change, impact on inventory accuracy, and other characteristics. These factors are important in determining what each technology is good for and where in the roadmap they fit.
In part three of this series, we provide guidance on a roadmap to RFID value for retailers — figuring out where to start and the best logical sequence of RFID use cases and infrastructure.
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1 Some retailers are using tablets or handheld computers that can alert associates, locate inventory, drive tasks, look up product information, and perform multiple functions including reading RFID. — Return to article text above
2 RFID checkout requires all items to be tagged and read with 100% reliability, while also reliably excluding nearby items that are not part of the purchase. — Return to article text above
3 In the context of RFID, ‘illuminate’ means to illuminate an area in the vicinity of a reader with RF (Radio Frequency) energy so that the RFID tagged objects in that area respond and are ‘seen’ by the reader. — Return to article text above
4 EAS door portals have been used for loss prevention in retail since the 1960s. — Return to article text above
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