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Global Logistics Focus Sept.21, 2015

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6A THE JOURNAL OF COMMERCE SEPTEMBER 21.2015 SPECIAL REPORT GLOBAL LOGISTICS FOCUS 2015 1990s as the death knell of brick-and-mor- tar retailing, RFID systems were oversold as essential and inevitable, despite much corporate resistance. The "hype cycle" about RFID climaxed a few years later when it became clear the technolog y was too costly and difficult to implement. A decade later, the hype has gone with the wind, but item-level RFID technology is playing a much more impor- tant role for many retailers, especially in apparel and footwear, according to RFID innovator Dean Frew, who founded soft- ware maker Xterprise in 2002, and is now president of SML Intelligent Inventory Systems. After the hype about the Wal-Mart initiative, there was "an RFID hangover," much like the all-too-hasty sense of resig - nation about e-commerce that cast a cloud over that promising sector after the dot-com bubble burst in 2000, Frew said. Gradually, it became clear that "RFID had huge potential for tackling out-of- stock" products, said Tom Litchford, vice president of retail technolog ies at the National Retail Federation. "Inventory management is a huge deal, and a lot of retailers are using RFID for (managing inventory of ) their high-margin items." Like e-commerce, RFID has "come back to life, kind of quietly" over the past few years, in large measure because RFID tools are cheaper, and the return-on-investment benefits are becoming clear, he said. A passive RFID tag that cost 33 cents in 2003 now costs about 10 cents. This year, apparel makers will use 3 billion RFID tags, according to a recent survey by ID TechEx. RFID, the study notes, "still has some way to go, with (the technology) penetrating about 7 percent of the total addressable market for apparel in 2014." What has gone right for the RFID industry? After gradually migrating from Wal-Mart's consumer packaged goods mandate in 2004 to the apparel sector during 2006 and 2007, RFID "entirely pivoted to apparel and footwear" in 2008. Frew was one RFID "IS ALL ABOUT MANAGING INVENTORY IN THE STORE ITSELF."

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