Staples' Reusable RFID Trial Expanding

A one-store RFID trial that Staples ran this summer with reusable tags has been declared a success by the retailer and will expand to four other stores in mid-February, said the retail chain's IT executive in charge of the project.

The initial Staples Canada trial was an attempt to see if the key argument against more-expensive active tags—which would typically cost between $5 and $8 apiece—could be defused. Historically, retailers have avoided using such high-end tags on merchandise that didn't cost more than $100, greatly limiting how much it could be used.

Theoretically, a reusable tag—which is removed at the point-of-sale—could radically change the chip's economics.

Joe Soares, the director of process engineering for Staples Canada and Business Depot, said his team evaluated the trial and concluded the cost-per-use—over a five-year lifespan, assuming the chain paid the full market price—was eight cents.

Beyond the cost per-use, Soares said the trial continuously delivered a 100 percent accurate read-rate and delivered a "21 percent reduction in out-of-stocks for the items that were counted."

The chain also saw "zero percent shrink" on the tagged items, which Soares said was especially noteworthy because the tagged items high-theft-targets such as MP3 players, laptops and desktop PCs. "Those items are the ones that are very hot. They are high profile," he said. "With it being a closed system, we knew right away if something was gone."

The chain will mimic the initial Montreal trial by only tagging a very small percentage of each store's SKUs. "We tested 1,500 SKUs and we are going to expand the same project to the additional stores," Soares said. "The results were so great that we wanted to see if it was replicable throughout the chain."

In the initial trial back in June, the chain paid nothing for hardware costs because the costs were covered by supplier partners, including Fujitsu and AbsoluteSky. For the trial expansion to four more stores, Staples is paying the hardware bill, but Soares indicated the rates they were charged by their suppliers were quite low. "The costs are indicative of them wanting to do business with us," he said.