Retail Concept Store
Using innovative concepts expediently
RFID technology and the possibilities it offers have been on everyone’s lips for years. However, it is far from being as widespread as originally forecast. Developed after the Second World War to optimize logistics processes, RFID is still used primarily in manufacturing and logistics.
A case-by-case analysis is necessary to determine whether RFID technology can be used profitably at stores. It has many different application areas, from article identification, shelf labeling or article surveillance to identification of employees and customers or cashless payment.
Basically, such concepts only appear to be profitable if RFID labels or RFID identification and payment media are widespread enough, i.e. have reached a critical mass.
At present, this critical mass is far from being reached as regards RFID labeling of individual articles, with the result that this technology cannot yet be used economically in many sectors. For the time being, it makes no sense to use it in sectors where low-price articles are mainly sold, for example in discount and food retailing.
This may be different where higher-value goods are sold, since the costs for implementing an RFID concept seem more justified. The technological possibilities offered by RFID apart from pure identification of articles can be leveraged better to the advantage of customers, retailers and producers.
The most concrete uses of RFID technology at present appear to be in employee and customer identification and cashless payment. Concepts and solutions based on NFC (near field communication) are being developed here, driven by companies in the banking industry. Field trials and pilot installations in which NFC-based payment concepts are being tested under real conditions are currently underway everywhere. Here too, however, the market is still a long time away from using NFC technology on a broad scale.
A focal aim of the NFC pilots is to evaluate practical NFC-based payment concepts. Media used in NFC payment technology are plastic cards, mobile phones, keyfobs, etc. Approaches for payment of small sums – low-value transactions – appear particularly interesting. The idea is to enable payment of small purchases without a PIN or signature by contact-free transactions. That entails enhanced speed in processing and convenience in paying, yet does not diminish security against payment default.
Such innovative payment solutions are being given a boost by Europe-wide harmonization of cashless payment transactions. This initiative, which is known as SEPA (Single Euro Payment Area), is being driven by the European Central Bank and aims to standardize systems within the participating states of the EU and EFTA, increase the speed of processing and reduce transaction costs as far as possible without sacrificing security and convenience. This environment will give rise to new customer- and retailer-friendly payment concepts alongside those types of payment that are already established today. In the wake of this, innovative cashless payment concepts that are internationally oriented from the outset, such as concepts based on NFC technology, will – driven by the market economy – become established, since the all too familiar country-specific bastions in cashless payment transactions will crumble.
It goes without saying that payment solutions must meet higher security requirements, since they are increasingly exposed to external attempts to manipulate them. The buzzword here is PCI (Payment Card Industry), which – driven by the large international credit card companies – will become the global security standard. That means not only cashless payment solutions, but the entire checkout and store infrastructure in retailing, including the enterprise solutions at head office, have to meet these security requirements.
Wincor Nixdorf is ready to design and implement these sometimes pretty complex solution approaches in concrete customer projects with its extensive experience in consulting, project management and integration.
