[jcrawfordor]

The cost-per-unit on RFID product tags (EPCs) has tended to limit them to products with a relatively high margin and a relatively high theft potential---clothing being the most obvious example and the most common application of EPCs, with retailers all the way down to WalMart using them for apparel.

You'll note that WalMart doesn't even use the EPCs at POS, which is telling: for most retailers, the main advantage of EPCs is far more actionable alarms at the exit. So they're limited to items where loss rates make the added cost worth it.

The problem is that the grocery industry has notoriously low margins, and the unit price of EPC tags can be the entire margin on a lot of products. On the one hand, Amazon may have been trying to work around the need for higher-cost tags to roll out this kind of automation. On the other hand, I have heard anecdotally that Amazon Fresh pricing was relatively high, so maybe EPCs would have been a wiser use of their extra revenue.

[timr]

Amazon Fresh was definitely not the cheapest option. It was on par with Whole Foods for groceries, IME.

But that said, interesting point. Didn't know the cost of an RFID tag was that high -- after all, Uniqlo is putting them on some pretty cheap clothing items!

[Iulioh]

Rfid tags are really cheap, some sellers advertise prices as low as 3c per tag but realistically 10c is probably the cost of a finished product (print, glue, maybe extra protection of the plastic)

[jcrawfordor]

That's the problem though - $0.05 is a LOT to a grocer, that's all they keep on a lot of products. Barcodes are free since they mostly go on labels that are being printed anyway. They could push for source tagging, but the vendor would pass on the cost, and grocery is a very price sensitive industry.

For apparel, on the other hand, source tagging is common - even before EPC on higher end goods, Calvin Klein used to sew magnetostriction tags into clothing. Apparel just has so much more price elasticity and loss prevention is a huge part of that industry. Tools are another industry where EPC and source tagging are common, once again, high dollar items with a lot of theft.