In the field of Textile and Apparel the RFID is used in manufacturing, inventory control, warehousing, distribution, logistics, automatic object tracking and supply chain management (Legnani et al. 2011; Liu et al. 2010; Moon and Ngai 2008; Gimpel et al. 2004). For example, the finished garments, different pattern pieces and accessories can be traced and the progress of the production process can be monitored. In processing and weaving, the fabric lots can be traced easily. In spinning mills, the bales of cotton and the yarns can be traced easily. The mixing of different yarn lots which is a major problem in spinning mills can be avoided.

A range of problems unique to fashion industry can be solved by installing the RFID system in various processes involved in fashion supply chain. Fashion industry can be divided into four sectors such as manufacturing, overseas transportation, distribution and retailing. In manufacturing RFID can be used to avoid product and component mixing, and mixing of different accessories. In overseas transportation RFID can be used to track and trace the consignment before and after Free on Board, if product is outsourced. RFID primarily can solve the issue of sorting and tracking the product very quickly, thus reducing the lead time during distribution (Moon and Ngai 2008). In majority of the retail shops, the space is a constraint, which needs to be used efficiently. RFID is used to manage the stock to identify the item quickly and correctly so as to avoid “search regret”, and thus help to solve the problem (Reynolds et al. 2006).

Inventory management

The use of RFID system assists in better inventory management and enhances customer shopping experience (Hardgrave et al. 2009; De Kok et al. 2008). The RFID system can indicate the type of clothing selling faster or slower, which provide customized advertisement on picked clothes according to the RFID tags. The RFID use also helps in reducing labour. For example, American Apparel applied RFID system in eight of their stores, which saved about 60–80 h per week in labor and reduced out-of-stock products owing to unawareness. Similarly, the Japanese apparel manufacturer ‘Sankei’ is using a RFID system in manufacturing to track clothes during the manufacturing process in addition to the online sales (Wu et al. 2009).

A successful case study has been conducted by Kaufhaulf departmental store in Europe on the impact of RFID on their processes and supply chain (Loebbecke and Huyskens 2008). They have concluded that RFID can be used in warehousing to track the goods and assist in cross docking operation as the goods received are not segregated in the warehouse but stored as they are received from the manufacturer. In the distribution center’s receivable area RFID readers can be implemented to track the goods as they come in. The received goods are registered and the data stored on RFID transponders can be read for each good though received in pallets or individual fashion item on hanger. In this the task of counting hangers, items and pallets can be eliminated and quantity can be controlled up to 100% satisfaction level.

Production control

Inside the stores of the production department the stock level can be quickly monitored which helps in a real-time and efficient inventory management (Wang et al. 2006; Lee et al. 2013; Jihui et al. 2011). The location and movement of the components, semi-finished and the finished products can be detected by the RFID system, which helps in production monitoring and control. The performance of departments and the individuals can be evaluated by the rate of movement of the garment components from the departments or individuals. This helps in improving the productivity and the quality. In the packing floor the mixing of different styles and sizes can be avoided by RFID tags. Also the number of pieces in packed cartons can be counted without opening, which saves the time and labour.

Retail management

It can be used in retail to monitor and control the floor level out-of-stocks (OOS) (Roussos 2006; Chen and Pfleuger 2008). It is mostly required where there is high product display density, low staffing level and chances of mishandling is very high. The stock level of the items is properly maintained and the items can be grouped according to their demand. Similarly, while receiving the goods at the store the accuracy of the deliveries can be ensured quickly with less labour. This can improve the inventory accuracy and automatic replenishment of stock. Mostly the retailers verify the accuracy and integrity of the shipment by open-box audit prior to stocking or storing of goods. But now it is possible to read all the items packed inside the carton without opening, which saves time and labour cost. So the RFID provides a new horizon to the retailers in receiving of materials, which eliminates the invoice disputes, mixing of different quality products etc.

The RFID has been used by number of major retailers in Europe and USA. Walmart is among the early adopters of RFID throughout their supply chain and the suppliers working with Walmart had been under pressure to implement RFID in their supply chain component as well. The reason of implementing RFID is line with Walmart’s corporate strategy of being cost competitiveness and faster response (Vowels 2006). After successfully implementation and use of RFID by Walmart, other big retailers like Marks and Spencer and Tesco in UK are adopting it, Coles group in Australia have given a thought of embracing this technology. Fashion industry is always regarded as the late adopter of new technology than others, but in adopting RFID it is not lagging behind.

The theft of garments from the fitting room can be prevented by mounting a small reader at the entry point of the room. The tag information of the garment is captured when the customer takes the garment to the fitting room. The items that are taken to the fitting room but not come out are reported as potential loss items. So the RFID can be used to identify the missing merchandise and prosecution of the shoplifters (Rekik et al. 2008; Jaselskis et al. 1995). In addition, the dislocation of the clothes is automatically detected and customers can be given advice on the fitting of the clothes they are trying on. The later task can be achieved by the use of smart try-out cabins and smart mirrors. The smart mirror can advise on additional clothing and fashion accessories (Roberti 2006). Companies such as Marks and Spencer, Levi Strauss & Co. are installing RFID to acquire data on the amount of stocks every day so that the stock can be replenished. However, significant difference was observed between the data received from the RFID systems and the actual inventory levels.

The store merchandise recovery and replenishment process presently used is completely manual, unsystematic and ineffective. Also it requires a very long time and high labour force and some popular items are not replenished for weeks. This can be overcome by RFID technology. The tags help to estimate the stock level frequently and there is an in-stock position improvement up to 30%. This has a positive impact on sales and customer satisfaction. It prevents the fashion or the seasonal merchandise to lie undetected in the back room and to be sold at significant markdowns thus improving the profit margin.

Also at the point of sales the RFID tag can be read quickly and it avoids the physical handling of the product as in barcode system. The RFID tags can be placed at the side seams or hem or in a paper cartoon label without affecting the aesthetic appeal of the garment. The number of items sold is automatically adjusted from the amount of stock. Hence, the customers can be informed about the status/stock of merchandise by interactive display screens. The use of RFID tags has helped to reduce the out of stock rate of Wal-mart by 16% and RFID enabled stores were 63% more effective in replenishing out-of-stocks than control stores (Age 2005).

RFID for brand segregation

It will be quite beneficial to adopt RFID system for departmental stores, which stocks a range of products and brands under one roof (Loebbecke and Huyskens 2008). The different brands can be controlled in terms of their inventory and location quite easily using RFID whereas it would be quite challenging task to segregate the brands in case they are mixed. RFID also reduces the human error as this technology is least human dependent when monitoring the inventory level, brand identification and product authenticity.

Radio frequency identification can also be used to avoid illegal product alteration to grey market and increasing product security and to give information about shopping behavior of customer at retail. Having all these issues solved, textile and fashion supply chain can be made more streamlined and efficient in terms of cost and performance.

RFID used in fitting room

Radio frequency identification technology is used in the fitting room in a new approach by a German departmental store “Galeria Kaufhof in Essen”, (part of the Metro retailing group). Automatic suggestions are provided to men buying clothes in the store when they go to a dressing room to try a suit. A ‘smart mirror’ informs them what kind of suit or accessories will be appropriate. An RFID reader on the smart mirror in the fitting room determines which clothing has been brought into the room from the RFID tag attached to the apparel. The appropriate accessories are then displayed on a suitable interface. This system is used in combination with ‘smart shelves’, which can read what merchandise is currently in stock, so that customers can be shown various styles and sizes that are available.

RFID tags for care labelling

The recent care labels are printed or woven labels storing a limited information (Nayak and Padhye 2014, 2015b). The electronic labels use RFID tags for storing information electronically on a garment. The same RFID tag used for containing the product details at the point of sale cannot be used for storing the wash care instructions, due to the privacy concerns. Hence, additional tags are needed for the wash care instructions, which will increase the cost of the garment. In addition, the consumers need special readers to extract the information stored in the RFID tag. Hence, they will prefer the physical label instead of an electronic label. Furthermore, the use of RFID tags in the garment, may pose health risks to the consumers due to the exposure to radiation.

The other concern related to the use of RFID tag is the electronic waste. An appropriate method should be devised to recycle or reuse the RFID tags, if they are removed at the point of sale. Similarly, if customers remove the chip at some point, proper disposal of the tags is essential, which causes additional worries to the companies. In addition, the other issues related to RFID are the lack of standardisation and high cost. Standardising the technology, design and use of the tags can solve the issues related to lack of standardisation, whereas the technological developments can help to overcome the cost related issues.

Radio frequency identification tags can be used in combination with the registered identification number (RN) system, which is currently in use in some places including the USA. The Federal Trade Commission (FTC) issues the RN, which can be used on the textile label instead of the company name. The use of RN system assists the buyers to easily identify a company from the RN using internet. The RN system uses less space on the label and more space is available for other care instructions. Therefore, the combined use of RFID and RN number systems could further benefit industry and consumers.

The use of RFID tags is still in its infancy stage. Hence, it is too early to conclude the final shape of RFID tag and its impact on consumers. One of the industry observed benefits to the consumers by including washing instructions in the tag. In Germany, RFID chips are being used in nursing homes to help the nurses in correctly sorting the garment according to care instructions. Hence, there is a potential benefit of RFID tags to the consumers. However, all the major drawbacks should be overcome to make RFID tags a success.

Customer relationship management

It is quite imperative to understand the needs and taste of customers especially in fashion industry to offer them the right product of their match. Moon and Ngai (2008) conducted a study on the use of RFID in fashion retailing and reflected that different customers behaved different at different time in their shopping experience and knowing them in depth regarding their shopping experience was very important so that sales personnel could provide them with personalized services. The interviewee in their study said that if the customer entered into the store and picked few item connected to RFID technology that would provide signal of their pattern of choices on that day so tailored advice can be provided by sales staff. As competition is intense between the brands so it is important to satisfy the customers by knowing their choice by creating their history of purchases, especially for high-end products. By creating their profile, age group, choice trend, preferred styles etc. the professional suggestion can be provided upon their next purchase so that they feel taken care of. Other significance of using RFID is to be in constant contact with VIP customers, even if the staff member quits the job.

As customers preferences are different so as their buying behavior and pattern, RFID can be used to interact product with the consumer to suit their choices and assist them making purchase decision (Nayak et al. 2015). Subsequently the customers can be offered customized assistance to cater to their choices thus increasing the revenue.

Intelligent clothes racks and smart shelves allowed Kaufhof to gain additional intelligence about the customers’ shopping and buying behaviours, which could then be used for further improving product and service offerings. Intelligent clothes racks were equipped with an RFID antenna. Each time a customer or employee removed a fashion item equipped with an RFID transponder from the rack, the movement was automatically entered into the merchandise management system. The moment the article was returned was also registered. The time that lapsed before a customer returned an item to the rack provided valuable information: If a customer put a blouse back on the clothes rack after 5 s, she possibly did not like the material. If 5 min went by, it is likely that the customer tried on the article. Smart Shelves offered similar functionalities for stacked goods.