Checkpoint Systems explains the benefits of using RFID technology in the supply chain to enhance product security.

In the current challenging climate for the supply chain industry, implementing effective tracking systems is an imperative for both good inventory management and as important, as an integral tool to enhance product security. 

For businesses trying to tackle all areas of shrinkage (the loss of inventory due to instances of employee theft, shoplifting and vendor fraud), counterfeit products and poor operational procedures, the use of RFID (Radio-Frequency Identification) technology has proven capabilities for enhancing security throughout the supply chain.

Ensuring products can be tracked and traced through the supply chain is an issue that the sector needs to address more dynamically.  This applies across all areas and can be achieved by implementing more efficient loss prevention solutions. 

Supply chain visibility and high detection accuracy

In RFID, detection is key.  An excellent, proven success using RFID technology solutions can be evidenced in its application for labels and source tagging, offering the ability to provide end-to-end, real-time asset visibility in the supply chain.  Apparel retailers, for example, are already using RFID encoded labels so that they can easily track products, as each RFID label has a unique identifier.  This means that every item can be monitored, both in situ and when moved to another location.  If there are any anomalies, these can be detected immediately through real-time tracking. 

Apparel Labelling Solutions (ALS), a subsidiary of Checkpoint Systems, is a global branding and labelling partner for apparel retailers, brand owners and manufacturers.  With over two decades of experience tagging items at source with RF labels, ALS now offers a comprehensive portfolio of RFID labels and tags.   Using intelligent labels and tags provides smart information which can be picked up immediately using RFID readers, giving full visibility of assets throughout the supply chain.

Inge Fleuren, Global Product Solution Manager, Checkpoint Systems, advises that the implementation of RFID as a loss prevention solution is a step-journey for companies, and that they need to create a baseline of what they want to get from using RFID. 

 “Checkpoint truly listens to the customer’s needs at its point in the supply chain.  We then deliver the most appropriate and cost-effective RFID solution for hardware, software, and tags, for every stage of the customer’s journey.”

Looking specifically at losses from theft, the need for effective tracking of products can be clearly seen when considering rising losses throughout the UK supply chain, from warehouses and distribution centres to retail stores.  The consequences of theft are significant, and not just from financial losses. Brand reputation and consumer trust in product authenticity and availability are also at stake.

Statistics on theft in the UK show a worrying upwards trend. Data from the latest Police Crime Data Report has revealed a total of 190,904 incidents in the first half of 2023, a 34% increase on the same period in 2022 and the equivalent of 525 thefts per day.

Products with RFID enabled tags and labels incorporated as part of a business’ loss prevention strategy have shown to provide a deterrent to thieves as they are less likely to target goods that can be tracked and traced easily.   

With rise of organised retail crime (ORC), another key area for consideration is the integration of RFID technology with CCTV cameras to enhance security and assist in identifying theft.  This is useful for all products and particularly so for high value goods, whereby RFID tags and labels are attached to products that can be identified by RFID antennae (readers) installed at critical areas, including entrances and exits. 

The RFID reader system can be integrated with the CCTV system to provide real-time data to the CCTV cameras, which are  triggered to record the movement of RFID tagged items through the above areas. 

When the RFID system detects suspicious activity, a silent alarm is raised that notifies security personnel, who can then use the live or recorded footage to identify potential thieves or unauthorised individuals.  Knowing that RFID and CCTV systems are being used can assist in deterring potential theft. 

Combatting the grey market

Being able to track and trace goods in the grey market has always posed a challenge. Take the beers, wines, and spirits (BWS) sector.  Historically, RFID technology was not a suitable solution due to the impact of liquids on RFID performance, making it complex to integrate into a production line.

Checkpoint Systems has found a solution in BottleID with its RFI tags for liquids.  These tags have been developed to provide top-level performance against liquids and improve quality tracking by association of key information at bottle level.

Provenance is displayed by assigning unique identifiers associated to D.O. serial numbers and this enables bottles sold in non-authorised markets to be identified with greater ease.  This helps brands gain full traceability from the moment they are bottled through to purchase, while authenticating stock to protect it from the grey market.

The proliferation of counterfeit goods is another issue as these can put consumers at risk as well as incurring considerable financial losses for businesses.  RFID labels encrypted with unique authentication features make product counterfeiting difficult as labels and tags can incorporate tamper-evident features that make it obvious if a product has been opened or if a label has been damaged or removed.  

Improving inventory accuracy with RFID technology

Inaccuracies in stock count can also lead to losses through theft, which can be hard to pick up.  Missed reads or stray reads directly impact efficiency and data integrity.  The use of RFID can significantly enhance inventory accuracy through automating data capture.  

By using RFID encoded labels, trained staff can easily use RFID readers to quickly and accurately scan multiple items simultaneously so that the inventory management system can update stock levels in real time.  This will enable any stock discrepancies to be immediately identified. 

Earlier this year, Checkpoint Systems brought out ItemOptix for Retail, its next generation of SaaS-based RFID solutions.  Built from 20 years of RFID deployment experience, this solution also features the ItemOptix Mobile App, with an intuitive user interface that makes it easy to manage an item’s journey through a store.

ItemOptix for Retail allows item-level detail – in retail stores, warehouses, distribution centres and online – for total inventory visibility that can help drive a 4% sales uplift, 90% out-of-stocks reduction, a 75% reduction in audit costs and 99% inventory accuracy.

Companies deploying ItemOptix software, can easily integrate RFID data into their existing operations, enabling a unified experience for both staff and consumers. For retailers, this helps them to seamlessly manage both store operations and omni-channel purchases, particularly for retailers that have recently made investments in mobile stores.

All Checkpoint’s Supply Chain RFID solutions are typically integrated with Checkpoint ItemOptix software, providing the latest feature-rich options to solve use cases for suppliers, distributors, and retailers.   If preferred, users can export all the RFID data from the Checkpoint system into their own repository to build individual reporting applications, providing all the necessary building blocks required to run a successful RFID operation.

From source to destination, RFID technology solutions need to be fully recognised as a “must have” for companies.  It is clear, that those companies who will succeed are the ones who will embrace innovative RFID technology solutions as an effective tool in their product security and loss prevention strategies.

Checkpoint Systems is the only vertically integrated RF/RFID solution provider for retail, delivering software, hardware, labels, tags and connected cloud-based solutions.

We are a global leader in EAS and radio frequency identification (RF and RFID) technology solutions across a diverse range of markets.  These include but are not limited to apparel, grocery, electronics, DIY, health and beauty, cosmetics, and logistics.

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