Retail Trends May Force New Compliance Rules on Consumer Products Manufacturers

With advanced technology available to consumers, retailers are actively looking for ways to enhance customer experience in-store as well as through other channels. The effect that this is having on the supply chains of consumer goods manufacturers should not be overlooked.

Two areas receiving a lot of news lately are:

• Cashless checkout
• The adoption of the omnichannel retail supply chain

Recently, J.C. Penny announced its plan to adopt cashless biometric payment in all stores by 2014. Their plan will use various technologies such as item-level RFID tagging, mobile checkout, WiFi networks, as well as self-checkout options. While many retailers have piloted various RFID tagging initiatives related to inventory management, J.C. Penny is the first at leveraging RFID technology to enhance the customer checkout experience. (Read more about this strategy inDailyFinanace.)

Another retail trend impacting consumer products manufacturers is the increasing adoption of the omnichannel retail supply chain. At the National Retail Federation (NRF) conference in New York this year, there was a distinct theme echoed by attendees: the need to evolve the current multichannel approach into one seamless presentation of merchandise in-store, online, and via mobile device.

One of the pillars of the omnichannel retail supply chain is online order fulfillment from retail stores. But this is a challenge as retail companies continue to face issues with in-store inventory accuracy. Retailers, such as Walmart, Macy’s, J.C. Penny, are already utilizing RFID tagging at the item level for apparel. And a growing interest is forming to expand the tagging to other products to increase store inventory accuracy in order to support omnichannel fulfillment. (Read more in this Supply Chain Digest article.)

The implications are clear, if RFID tagging at the item level takes firm hold, consumer products manufacturers’ supply chains will be impacted in order to support item-level RFID tagging. New processes and systems will be required to manage customer data and compliance requirements.

Source: Tompkins (http://goo.gl/vMHP0)