Bar codes have been popular in the world of retail for several decades; they have made the process of shopping much easier compared to its prior form. The combinations of black lines that comprise bar codes are scanned by the optical reader devices to decode the information (the title of an item and its price) (Thrasher, 2013). RFID tags are more recent as a technology. Each tag is unique and is also scanned with a reader device that powers them in order to transmit the information encoded (Thrasher, 2013).
There are some advantages due to which RFID tags are viewed as a more advanced technology. First of all, they can be read at a larger distance and from different angles. Secondly, they are reusable (new information can be rewritten on them) (Thrasher, 2013). Also, the tags may contain a much larger amount of data, and they last longer than bar codes. Besides, RFID tags are difficult to counterfeit, so they offer more security (Thrasher, 2013). Overall, the tags are recognized as more cost-effective.
However, regardless of all the benefits the RFID tags represent, switching from bar codes to the new technology can be rather costly and challenging for a business. Apart from the clear advantages of RFID tags, there are multiple factors the retailers need to consider.
First of all, if the tags are applied at the department stores, the managers are to invest in the purchase of the new technology. The tags do not have a high price (about ten cents apiece); however, their application may become a serious challenge because each item at the store is to be provided with an individual tag. The process of tag application at the department stores could take a very long time and slow down that business thus minimizing the revenues and effectiveness. Therefore, it would be more cost-effective for the manufacturers to add the process of application of the RFID tags as a part of the packaging activity.
That way, the items would be delivered to the supermarkets and department stores with their unique codes. Besides, the addition of the tags at the initial stages of the supply chain is a massive advantage as it would allow all the other participants of the chain to benefit from the new technology and speed up their operations optimizing the working process and maximizing efficiency.
As a result, the initiative of the bar code replacement could begin with the department stores’ request for the manufacturers to switch to the new technology. It is vital that the largest department store chains such as Macy’s, Wal-Mart, and JC Penny’s take part as the initiators of the action. The large and powerful retailers are more likely to force the progress forward and facilitate the change. As for the manufacturers, a factor important for them is the printability of the RFID tags as the individual placement of the tags on each item (just like in the case of the department stores) is likely to slow down their operations and significantly reduce their productivity.
To sum up, just the tag application process is a time-consuming, and yet, a very promising innovation. Moreover, the scanning of the tags is the second part of the change that is very important in terms of organization as it requires investment in the new technology (the reader devices), and training for the staff to be able to use the RFID scanners. Both software and readers are rather costly; and the larger the store – the more scanners it will need.
Reference
Thrasher, J. (2013). RFID vs. Bar Codes. Web.