Statistics show that the fashion industry has caused an incredible amount of waste, and this number is expected to only increase. Experts believe that if significant changes are not made, the negative impact of the fashion industry on the environment will double by 2030. This encourages leaders in the clothing industry to collaborate on developing innovative new methods to improve the practices and technologies used in the industry and reduce their collective carbon footprint.

The necessity of retail industry transformation

Many people believe that supply chain management is the biggest improvement area in the retail and clothing industry. Enterprises are increasingly realizing the impact of their products and practices on every step of the production and distribution process. By better understanding each part of the supply chain, business leaders can more easily identify and remedy inefficiencies that pose challenges to sustainable development.

In today's consumer environment, as consumers become increasingly aware of the ecological impact of their purchases, businesses (especially retailers and other consumer oriented businesses) emphasize the importance of sustainable development more than ever before. According to McKinsey&Company, over 60% of consumers indicate that they are willing to pay more for sustainable packaging products. This proves a fact that investing in sustainable development technologies in the retail industry not only yields returns in terms of sustainability, but may also yield returns in terms of profits.

A technology that is revolutionizing the retail industry is Radio Frequency Identification (RFID), which uses radio waves to read information from antennas located on stickers or tags without the need for physical contact with the line of sight. This technology has many applications, such as car keys, employee identification, secure access cards, toll billing, etc. Although RFID has existed for decades, innovators have been searching for exciting new use cases for this technology, which could have a huge impact on many industries, including retail.

How RFID Changes the Sustainability of Retail and Clothing Industries

Some people may want to know the relationship between RFID technology and the sustainability of the retail industry. This innovation is expected to help retail enterprises better manage inventory and supply chains, thereby making their businesses more environmentally friendly. RFID technology provides retailers with end-to-end visibility into the product lifecycle, enabling them to track every item in the supply chain and gain a deeper understanding of product success, thereby making wiser decisions about inventory.

For example, if RFID technology is used to track product inventory and alert retailers that a specific product is not selling well, retailers can reduce the amount of inventory they order. Conversely, manufacturers will produce fewer of these products. Considering that textile production accounts for approximately 20% of global clean water pollution and 10% of global carbon emissions, the opportunity to reduce this waste from the source reflects a strong demand for technologies such as RFID, enabling retailers to better manage inventory.

Improving inventory management through RFID technology has also reduced retailers' reliance on transporting large quantities of products. Due to many garments, especially those in the fast fashion industry, being produced overseas to reduce manufacturing costs, these products must travel thousands of miles to reach distribution centers or stores. The airplanes, ships, and trucks used to transport these textiles from point A to point B consume a large amount of fossil fuels, leading to greenhouse gas emissions.

The adoption of RFID technology by retail enterprises has two benefits. In addition to sustainability advantages, retailers also benefit from the cost savings and potential security risks of RFID technology. For example, some retailers have started looking for applications of RFID technology to combat retail theft. Based on the quantity ordered by the enterprise, the price of RFID technology can be as low as $0.04 per unit, which is a worthwhile investment for most retailers who correctly integrate RFID technology.

Some people may be concerned that introducing new technologies like RFID may only be a temporary solution. After all, if reducing waste in the textile industry is to increase the production of computer chip technology, what are the benefits of doing so?

However, it must be noted that most RFID tags are made of small pieces of metal and polyethylene terephthalate (PET) plastic - both of which are easily recyclable. Some innovators have even started using biodegradable materials such as paper to develop RFID technology, further highlighting how this technology will have a positive impact on the sustainable development of the textile industry.

By using technologies such as RFID, businesses in the retail and fashion industries can better understand the impact of every aspect of the supply chain on its sustainability. Although small, RFID chips have enormous potential to address many sustainable development challenges in the fashion industry. There is still work to be done, but the insights provided by RFID technology will enable these departments to minimize harmful impacts on the environment to the greatest extent possible.