RFID self-service checkout - How does it work?
There are several ongoing retail trends, with the aim of making the shopping experience more convenient for the end customers. Various solutions are tested, from smart carts to automated checkouts and the use of machine vision. One of these emerging checkout-solutions is the use of RFID tags. But how does this work, and what are the implications of implementing such technology in the store? Learn more here!
Due to the increased demand for shopping experiences with less friction, retailers have been motivated to invest in technology to meet these consumer needs. Those who fail to do so, encounter the risk being overlooked or outrivalled by competitors. In the US, almost 75% of consumers have used some sort of self-checkout.
Solutions such as self-scanning, AI-based visual recognition and RFID has been both tested and implemented with various success. Perhaps the most successful one to date is the self-scanning approach, where customers can use both a dedicated device and their own smartphone to scan their items. But as technology has progressed, also RFID checkouts has grown in popularity. RFID technology is nothing new, but using it as a checkout alternative is a relatively modern solution.
RFID in retail
RFID technology has multiple uses in a retail environment. It can be used to track peak sales for specific items, or to be scanned by a smart mirror and showcase the items on the customer directly, among other things. However, historically it has mostly been used for inventory management purposes – such as keeping track of products received, updating inventory in stock etc.
Also, as RFID can be connected to EAS (electronic article surveillance) systems, it has been a great way for retailers to minimize shrinkage during the last decade.
As technology has progressed, some retailers such as Uniqlo has implemented RFID to their checkouts, bridging the gap between inventory management and customer checkouts.
How does it work to use RFID tags for checkout?
RFID is an abbreviation of radio-frequency identification, and the technology allows retailers to scan and identify their items by the use of radio waves. Basically, this technology consists of tags, antennas, and readers.
This gives the retailer an accurate view in real-time, on the condition that all items are marked with an RFID tag. The tags work the same way as a barcode, meaning that they provide information about the product ID when scanned.
For checkout, all items are placed in a designated area, and are automatically registered by the self-checkout machine. As all items have their own RFID tag, the self-checkout hardware will register each product and add it to the total bill.
What is the difference between RFID and NFC?
Another technology used for short-range communication is Near-field communication (NFC). This technology is actually a subset of RFID, however there are some differences. For example, in order to use NFC successfully, the two parts needs to be 10 centimetres or closer to each other. Moreover, only one tag can be scanned at a time, making it more similar to barcode scanning. Perhaps the biggest difference between RFID and NFC is that NFC is two-way communication, whereas RFID consists of one tag and one scanner, meaning that there is no way information can go back and forth.
In a retail context, NFC is therefore not suitable for scanning product items, but could instead be utilized for mobile payments where the two parts need to communicate on a two-way basis (between the smartphone and the payment station).
What are the benefits of RFID checkout?
Naturally, RFID checkout shares several benefits with other self-checkout solutions, such as the convenience not having to wait in line for a staff member to register the items. There is a lot of positive effects of self-checkouts, both for retailers and their shoppers. To learn about the benefits of self-scanning for retailers, learn more here. Many of these also applies to RFID checkouts.
Here are some of the benefits that are more or less unique for the RFID checkout:
Possible to scan multiple items at the same time
One of the main benefits of RFID checkouts is the possibility to place all items at the designated checkout area, and to have them all scanned together and instantaneously. This is something that traditional barcode scanners are unable to do.
Can be connected to the EAS system to minimize theft
As the RFID checkout can be connected to a retailer’s electronic article surveillance system, it is possible to alert when unpaid items are leaving the store. This way, an additional security element is added to the checkout solution.
Provide real-time inventory information
By using RFID checkouts, the inventory management system can get automatic updates about how many items are left in stock. This enables a wide range of possibilities, such as using data to predict sales, and to make sure inventory is fully stocked with the most popular items.
What are the challenges of using RFID checkout?
While RFID checkout utilises existing and well-known technology, there are some downsides to this type of checkout. While some retailers find these obstacles acceptable, others find that there are more suitable options in terms of self-checkout.
Costly to implement
Some argue that the RFID checkout is a costly solution. Not only are there substantial initial costs such as hardware for the checkout area, there is also a continuous process of tagging all items with the RFID tag. As new product lines are introduced to the store, adding the RFID tags might be an extra step that some retailers don’t have the time, or the funds, to do. Moreover, integrating the self-service system with the EAS system might be a smart way to minimize shrinkage, but could also be costly depending on the setup.
One RFID tag to every product
In order for RFID checkout to function, a RFID tag needs to be added to each separate item, regardless of size and quantity. Similarly to the problem stated above, there is no work-around here. However, if the retailer is able to integrate the RFID checkout with the EAS system, the benefits might outweigh the extra work.
Not all products are easy to tag
Some products are not only hard to physically tag, their material can make it hard for the reader to actually register the tag. Such materials include fluids and metall. There are ways of working around this, but depending on the product range of the retailers, such methods can be both complex and time-consuming.
Not all items are suitable for the RFID checkout area
As previously mentioned, the idea of self-checkout with RFID tags means that all items are placed in the designated area, and thereby scanned immediately. Usually, these designated areas include a bin, or on a desk. For items that are not too big or heavy, this is a practical option for most costumers. But for those retailers that sell bulky items, this could be a problem. Is it feasible to expand the size of the RFID checkout area, or are there other solutions that solve this problem better?
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