Mar 15, 2016
Inditex controls the whereabouts of more than 1 billion garments
Mar 15, 2016
The owner of Zara, Inditex, produces over 1 billion garments a year in 50,000 factories. Organising such a large load can be a challenge for every company, which is why the Spanish group has developed a new project that uses Radio Frequency Identification (RFID) to identify every garment individually and have real-time knowledge of their physical whereabouts. The technology, which is up and running in 1,542 stores across 64 markets, is scheduled to be fully operational in all Zara stores by the end of 2016.
Inditex’s RFID is recorded in chips embedded in the electronic article surveillance tags, which are added to the garments as soon as they arrive at the group’s logistics centres.
The innovation delivers precise information on all shipments received in store and exact data on the item’s availability in stores or warehouses. It also makes the logistics process even faster by allowing individual garment requests using internal messaging and guaranteeing their shipment to any store in the world in less than 48 hours.
RFID also improves in-store workflow, and delivers enhanced security control. Store staff will now control shrinkage more accurately, which is the loss of inventory attributed to factors such as theft, damage in transit and administrative and cashier errors. This shrinkage accounts for 0.8% losses on Inditex’s annual sales, representing almost 170 million euros.
Additionally, the company’s stores, which receive new stock twice a week, now enjoy a higher and more agile garment intake due to the new technology. RDIF also facilitates stock replenishment and inventory management, meaning staff can find a garment with a PDA more easily.
The data embedded in the chip is deleted as soon as the alarm is deactivated upon purchase. The security alarms used were developed by Inditex and produced by Tyco.
“This is an innovation project in its purest form, there is no other like it in the world, and has been developed entirely by us,” said the company’s CEO, Pablo Isla.
Although other retailers also use radio frequency waves, Inditex is the first company to design a 100% reusable and recyclable system, according to the head of the company’s RFID project, Ivan Escudero.
While many brands embed the codes into different interior and exterior tags, Inditex has achieved to record the data in the garments’ security alarms, which can be reused over a 100 times.
The company has invested over 4 billion euros in this project over the past 2 years, strengthening a business model that has led it to become fashion’s top retailer.
After implementing the system throughout Zara's more than 2,000 stores, Inditex plans to roll out RFID tags for Massimo Dutti, Bershka, Stradivarius, Pull & Bear, Oysho, Zara Home and Uterqüe.
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