The Voluntary Interindustry Commerce Standards Committee (VICS) and the American Apparel & Footwear Association (AAFA) has released a report titled, "Moving Forward with Item-Level Radio Frequency Identification in Apparel/Footwear." Prepared by Kurt Salmon Associates (KSA) with assistance from industry members, the report highlights where Radio Frequency Identification (RFID) item-level tagging provides the greatest value along the value chain; who stands to benefit most from RFID; and which merchandise categories are best-suited to deriving benefits from the technology.

The report is the result of a four-month study of the business practices and process impacts of RFID on manufacturing, distribution/logistics, inventory management, store operations, finance, loss prevention, and merchandising, to help member companies determine the right starting point for RFID evaluation.

The study concludes that particular advantages can be achieved in the retail environment, where significant benefits can be achieved quickly and provide funding for upstream RFID-enabled processes. "The results of the white paper indicate clear benefits for RFID item-level tagging for the apparel and footwear value chain, especially at the store level. Companies running pilots are beginning to realise the potential benefits of this technology," said Mary Howell, vice president, Industry Relations, AAFA.

Another key finding was that no single upstream process can absorb the tag and infrastructure investment of RFID, but when combined with retail-level benefits, incremental costs can be offset by improvements in operational efficiencies, shipment and billing integrity, and brand margin performance.