by Alexander Wissel, Executive Editor
This week our team has been investigating “the next big thing” in Grocery at the National Retail Federation (NRF) “Retail’s Big Show 2026” in New York City – a whopping 40,000-plus participants and organizations from around the world.
One of the clearest takeaways from the NRF expos was unmistakable: radio-frequency identification (RFID) is no longer theoretical for the average retailer. The question is not whether the technology works, but whether the use case and return on investment justify action today.
Before making that decision, it’s worth stepping back to understand what RFID is and what it meaningfully enables.
What RFID Is and Why It Matters
At its most basic level, radio-frequency identification (RFID) uses radio waves to allow a tag to communicate wirelessly with a reader. Tags can be powered or passive, enabling different applications, but the underlying concept is straightforward: a tag transmits data without requiring direct line-of-sight.
A simple RFID system consists of a reader or antenna (which can also power passive tags), a printer to produce tags, and a processing layer to organize and interpret the data. In practical terms, this may be nothing more than a handheld scanner, a specialized printer, and supporting software.
What this setup unlocks, however, is far from simple.
Unlike traditional barcodes – which require individual, visible scans – RFID tags can be read in bulk, and without being seen. Multiple items can be captured simultaneously. This enables real-time visibility into inventory, product movement, loss prevention, checkout automation, and even perishables management.
Depending on the tag type, RFID provides retailers with a level of product-level intelligence that has historically been unattainable at scale.
Why Isn’t RFID Everywhere?
It comes down to costs of course. For many, this technology is still prohibitively expensive.
At a per-item level, adding even $0.10 to $0.25 per tag compounds quickly across thousands of SKUs. Store-level implementation costs can be substantial, particularly when hardware, integration, and training are factored in. Even the most sophisticated system fails without consistent operational ownership.
RFID requires dedicated oversight to ensure data is accurate, organized, and acted upon.
Affordability has therefore limited adoption. The organizations that have led RFID deployment – most notably Walmart and Amazon – have invested billions over many years to refine these systems. That level of capital commitment is simply not realistic for most retailers.
The Overlooked ROI
Historically, RFID produced a volume of data that was difficult to fully monetize, or even understand by the typical employee. That constraint no longer exists.
The real inflection point for RFID is its convergence with current AI and large language models. What was once an unwieldy stream of raw signals can now be translated into usable, cost-effective insight.
Consider the benefits: identifying a refrigeration failure in a specific transport lane that consistently and unknowingly shortens shelf life; knowing precisely when an item exits a store without being paid for; maintaining continuously updated inventory without manual counts.
These are no longer edge cases; they are achievable outcomes.
RFID provides the data foundation upon which AI-driven optimization can be built. Millions of granular data points allow systems to understand operations holistically, revealing patterns and inefficiencies that were previously invisible.
In this context, RFID doesn’t merely complement emerging technologies – it makes some of them unnecessary. The promise of humanoid robots conducting inventory counts becomes far less compelling when the inventory already ‘knows’ where it is.
The Path Forward
Much of this infrastructure exists today. What’s missing is accessibility by smaller retailers.
The bright side is that costs will continue to fall. Providers will emerge with solutions that make RFID viable beyond the largest enterprises. When that happens, the return on investment equation will change quickly.
Retailers don’t need to deploy RFID tomorrow – but they do need to be actively monitoring when the economics cross the threshold. Adoption will be critical for those who intend to leverage AI meaningfully inside the store.
What was once prohibitively expensive will become table stakes. The organizations that understand this early – and prepare accordingly – will be positioned to extract value when “someday” becomes operational reality.
