Herve D’Halluin, leader of RFID united & referent interactive sports products, Decathlon.
The world’s largest sporting goods retailer is an enthusiastic proponent of supporting front- and back-end operations with RFID technology.
Chain Store Age recently spoke with Herve D’Halluin, leader of RFID united & referent interactive sports products, Decathlon, about how the France-based sporting goods retailer leverages RFID technology from source to checkout.
When and why did Decathlon start using RFID technology? Being a vertically integrated company, we research, design, manufacture, market and retail our own branded apparel, equipment, and related sports merchandise. Having to manage logistics, inventory, labeling and tracking of the thousands of products we produce, we looked for a game changer to overcome these challenges and streamline the complexities efficiently.
Decathlon decided to use technology-agnostic GS1 standards and adopt Electronic Product Code (EPC)-enabled Radio Frequency Identification (RFID) to uniquely identify every product in our portfolio, worldwide. The chosen data carrier was RAIN RFID tags, upon which the chosen data format was the EPC.
Even though we are vertically integrated, we chose to utilize GS1 standards in order to be able to uniquely identify Decathlon’s products anywhere and in any kind of supply chain.
We initially engaged this technology for a pilot program in 2008, which was successful. By 2014, the solution was rolled out in all Decathlon processes, including warehouse and retail store inventory, earning recognition for the most extensive use of the technology in retail. By 2019, Decathlon had tagged 100% of products. Between factories, warehouses and stores, we use over 50,000 RFID readers worldwide.
Before deployment of this solution, staff members would confirm whether a product was labeled correctly by scanning the barcode and then entering the data into a database. The technology simplified this procedure and shortened the entire process to less than a few seconds. Using a handheld reader, the accuracy of sorting was also greatly improved. Although the difference between the two operations at first glance is less than 10 seconds, when you calculate the thousands of times this activity occurs worldwide, the time savings are huge.
How does RFID help you with inventory tracking? With a unique EPC value on every item carried by a RAIN RFID Tag, each warehouse, distribution center and store can benefit from highly accurate and fast inventory, and improved replenishment while manufacturing processes are optimized.
The principle behind this chip is straightforward: it can communicate and provide each product’s unique identifier from up to several meters away, in hundredths of a second, and even through boxes. Automation via this game-changing technology delivers advantages from pinpointing shelf location to sales checkout to post-sales interactions with consumers.
This capability enables us to sell at the right price and ensure on-shelf availability, while precluding overstocks. As mentioned, accurately tracking the availability of products was part of the original impetus behind the company’s investments.
Missed sales were having an impact on both revenue and customer satisfaction, but with EPC/RFID, we are now able to better track inventory and help satisfy those customers by allowing them to see if the product they want is available, including where it is available, in order to buy it. Of course, Decathlon is very happy because we can sell more and don’t have to overstock products.
How does RFID help you with cash collection? Since all products are tagged with an RFID chip, when it comes to brick-and-mortar checkout, consumers need to only put goods into the basket of the self-service cash register. The reader can automatically identify items and complete payment. There is no need to individually scan each item. Before we implemented, customers could wait up to 20 minutes queuing for payment.
Today, the technology allows customers to spend less than one minute paying for merchandise. The system improves the efficiency of cash collection by 20%, resulting in shorter wait times, shorter lines at checkout and happier patrons.
How does RFID help you combat counterfeiting? We are cognizant surrounding the risk of counterfeiting and its potential impact on our reputation. We are not a luxury goods company, but we are facing more and more these kinds of issues. RFID technology provides an opportunity to combat counterfeiting Data housed on each individual EPC/RFID tag carries a respective product serial number – so each product is uniquely identified among a grouping of products just like it.
The benefits of the technology extend through the value chain. Decathlon is leveraging its expertise by advising other organizations in how to address counterfeiting, grey markets, and manage customs duties. These are of key importance for many international corporations.
Can you discuss any future RFID plans? This has been a game changer for us. In addition to the aforementioned efficiencies, our continued focus remains on being a more sustainable and circular company. The technology plays a pivotal role in the simplification of sorting products to allow for more efficient recycling processes.
With this level of accuracy in identification, we foresee an eventual reduction of 20-30% in raw materials needed to manufacture products, diminished overstocks and a reduction in excess shipments and unsold products.