Time for healthcare to follow the retail industry into the future with RFID technology

Asset Management

The retail industry has been using RFID technology for over 20 years to keep track of their assets and products. Early adopters noticed the benefits of the technology and since then, many retail chains have made huge investments into RFID tracking systems. Another industry that deals with an enormous amount of assets and products is healthcare. Today, hospitals rarely perform inventories and there’s no reliable way of keeping track of assets. RFID helped the retail industry improve their stock control, reduce holding costs and therefore boost their sales. It’s time for healthcare to learn from other industries and use RFID to improve their inventory insights and gain control of their assets. When the technology is there – why not use it?

First off, what is RFID and how does it work? RFID technology works by using radio waves to read and transfer data from a small chip to a reader. The RFID reader then transfers the data to an asset tracking software where it is stored and evaluated. In the retail industry, clothes and products are tagged with RFID tags which are then scanned, either with a hand scanner or a stationary reader. This allows staff and administrators to automatically track inventory and stock levels.

Improved inventory accuracy

Recent research showed RFID technology improved inventory accuracy from 65-75% to 93-99% within 10 industry leaders in retail. Keeping track of inventory minimizes loss and theft while being able to keep a continuous flow between stock and store.

Boosted sales numbers

The same research project showed a 5.5% increase in sales for a UK retailer when using RFID tracking solutions. Retail products have a very evident price tag so a retailer’s efficiency in handling and administering their products shows up in their sales. In fact, as much as 8.7% of sales can be lost due to a lack of inventory accuracy. It makes sense, products that aren’t in the store can’t be bought and products not available in stock can’t be ordered online.

Since the benefits of tracking products with RFID solutions are so large, it’s more common than not for retailers to use it. Here are some examples of retail chains using RFID technology to track assets:

• H&M – Swedish clothing and fashion company with nearly over 4700 stores worldwide.
• River Island – UK founded clothing brand with over 300 stores worldwide and six online sites.
• Zara – Spanish fashion brand with nearly 3000 stores worldwide.
• Amazon – American multinational e-commerce company with shipping worldwide.
• Tesco – British multinational grocery and general merchandise retailer with almost 5000 stores.

The numbers speak for themselves. Research clearly shows there is a financial profit to keeping track of stock and inventory, which is why RFID is so popular in retail. So, how come RFID technology isn’t used in other industries, like healthcare?

Healthcare could reap the same benefits

Even though the price tag on medical assets isn’t as evident as retail assets, it’s still very much present. A huge amount of assets, clothes and medical devices are used and delivered within a hospital every day. Keeping an accurate inventory of assets saves time and resources, just like in the retail business. If hospitals and medical providers used RFID technology to track and administer their assets, they could:

• Save money and resources by having updated and accurate inventory lists that eliminates over purchases.
• Save time and energy for staff by them not having to search for assets or perform intricate administrative tasks.
• Help the environment by fully utilizing existing assets and not ordering unnecessary additions.
• Contribute to better patient care. Asset management streamlines work procedures, resulting in less risk for error and more time for patients.

Medical assets stand for a large portion of a hospital’s yearly expenditures, and it seems self-explanatory why having administrative control over them is important. The retail industry saw the opportunities with RFID technology early and has benefitted since – it’s time for healthcare to do the same.

If you have any questions about RFID technology, feel free to contact us directly. We’re here to help.