By the end of this year or the start of 2017, Connell said, more than 60 percent of all goods at most of Macy's stores will be RFID-tagged and cycle-counted monthly via handheld RFID readers. Macy's had published the tagging requirement in its vendor standards manual, he said. Now, the retailer is working with suppliers to get them to tag merchandise at its source.

"We still have a lot of work to do with our suppliers to get that joint commitment to apply tags at source," Connell said. "We are now moving into additional use cases that are enabled because of RFID and, equally important - because of the availability of accurate information - on a very quick basis."

In 2015, Macy's announced that it was expanding its RFID-tagging deployment to all lines of businesses at its stores, except for jewelry and cosmetics. These two categories were not a focus since there were challenges finding tags that worked effectively and would not negatively impact the items' presentation. Connell said there is a chance that Macy's will not be able to resolve those issues in time to meet the end-of-2017 goal.

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