The hip clothing retailer is set to roll out "item-level" RFID tags to track its inventory, although there are still lingering questions about what'll happen to the chip in that hoodie you just bought.

The RFID Journal reports that American Apparel launched a trial chipping program at a single New York City location late last year, and plans on rollout out RFID tracking to 16 more Gotham stores over the next three months, with a national rollout to follow.

Now, there's nothing new about retailers using RFID tags to track their inventory—but as the RFID Journal points out, the chips are usually embedded in single cases or pallets, not individual items. American Apparel will be one of the first retailers to chip each and every shirt, sweater, and sock.

So, how do we feel about this? Well, for its part, American Apparel says it’ll have better-stocked stores, with "one of everything on the floor"—meaning you'll always find your size and color on the shelf. And since it'll take less time to take inventory (just two clerks for two hours a week, versus four employees taking eight hours a week, according to RFID Journal), you'll get more help while you're shopping.

That said, what happens to those RFID chips when you walk out the door? For its pilot program, American Apparel clerks removed the chips from clothes once they were sold, the Journal reports, but after the rollout, the tags will remain in the garments you buy. [Update: The chips will be on the price tags, not woven into the garments themselves; see below.]

RFID Journal said that American Apparel has yet to detail exactly how—or if—it plans on deactivating the chips once your T-shirt is bought and paid for.

While I seriously doubt American Apparel has anything nefarious up its sleeves, the company would be well advised to detail its RFID privacy policies, pronto, and nip these nagging questions in the bud.

What do you think—are you all for "item-level" RFID tracking if it means always finding your size and getting better service? Or are you worried that Big Brother wants to track your new V-neck?

Update: A representative from American Apparel has responded with a clarification—the RFID chip will be on the price tag, not sewn into the garments themselves. His full reponse follows:

I am the Information Systems Director at American Apparel. I would like to request that you remove incorrect information from your article "American Apparel to track its clothing with RFID."

American Apparel will not be sewing RFID tags into the garment itself. The chips will be embedded in price tags, which are easily removable at any point by the customer.

While I think it's important to encourage people to discuss privacy issues and challenge new technologies, we do not believe that there is any privacy implication here. The tags contain no personal information, at any point, and can easily be removed by the customer (most stores do not remove price tags for you in case of returns).

I think you need to clarify this point, there are hundreds of comments taking your words very literally and I want to prevent further confusion.

Related:
American Apparel Makes a Bold Fashion Statement With RFID [RFID Journal]